Long Harbour Exploration Corp.

Long Harbour Exploration Corp.

March 06, 2012 08:00 ET

Long Harbour Enters Into Letter of Intent to Purchase Kentucky Coal Property

VANCOUVER, BRITISH COLUMBIA--(Marketwire - March 6, 2012) - Long Harbour Exploration Corp. (TSX VENTURE:LHC) (the "Company") reports that it has entered into an exclusive Letter of Intent to purchase coal and coal related assets located in Kentucky owned by Pyramid, Inc. The Letter of Intent is non-binding except as to exclusivity.

Highlights of the assets to be purchased include:

  • Substantial in situ coal assets;
  • Close proximity to large neighbouring loadout facility supports access to Asian metallurgical coal markets;
  • Fully permitted and fully operational mine with recent historical production of approximately 25,000 tons per month;
  • Permitting to commence surface mining and expand underground operations to increase production.

The acquisition of selected assets from Pyramid, Inc. includes a fully permitted and fully operational mine focused on mining the renowned Whitesburg and Elkhorn coal seams. Recent historical production is approximately 25,000 ton per month that includes coal sold into the US PCI market. The Company plans to increase production following the acquisition and to focus on the international markets that place great demand on high quality coal.

The mine is conveniently located in proximity to a state-of-the-art rail loadout facility with a capacity of 92 rail cars that is able to transport coal to barge facilities for offshore shipment.

The transaction is subject to TSX Venture Exchange approval.

Long Harbour Exploration CEO, Peter Espig, commented, "We are fortunate to have an opportunity that may allow us to leverage our management and board's rich experience in the coal and shipping sectors with deep Asian networks. Arbitrages exist with regards to consolidating coal from smaller producers and the US versus Asian market demand for metallurgical coal to which these assets could play a vital role. In addition, because the mine is fully permitted and fully operational, start-up timing and CAPEX exposure is significantly mitigated. Operations are expected to be simplified because, rather than assuming full mining responsibilities, we expect to enter into a mining contract which will allow us to leverage Pyramid's local mining expertise."

The Company will provide additional transaction details in subsequent news releases.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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