Western Canadian Coal Corp.

Western Canadian Coal Corp.

March 23, 2006 09:05 ET

Western Canadian Coal Corp. Closes C$125 Million Convertible Debenture Financing and Debentures Commence Trading on TSX

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - March 23, 2006) -


Western Canadian Coal Corp. (TSX:WTN)(TSX:WTN.DB)(AIM:WTN) ("WCCC" or "the Company") is pleased to announce that further to its news release of March 1, 2006, it has now closed a C$125 million convertible debenture financing and that effective March 23, 2006, 125,000 convertible debentures are eligible to commence trading on the Toronto Stock Exchange (the "TSX") under the symbol "WTN.DB".

GMP Securities L.P. and Sprott Securities Inc. have sold by way of short form prospectus 7.5% subordinated convertible debentures in the aggregate principal amount of C$125 million, including the underwriters' over-allotment option. The convertible debentures bear interest at 7.5% per year, payable semi-annually, mature March 24, 2011, and are convertible into common shares of the Company at any time prior to their maturity at a conversion price of C$4.00 per common share. The convertible debentures are redeemable under certain conditions by WCCC commencing March 24, 2009.

The Company's major shareholder, Cambrian Mining Plc ("Cambrian") of London, UK, has subscribed for C$40 million of convertible debentures. John Byrne, Chairman of the Company, is also the CEO of Cambrian and Mr. John Conlon, director of the Company, is also a director of Cambrian. Cambrian and its wholly-owned subsidiary, Deepgreen Minerals Corporation Ltd., currently hold approximately 34.8 million shares representing 41.5% of the issued shares of the Company.

The proceeds of the offering are being used to repay approximately C$20.2 million in principal and interest due under the bridge financing facility provided by Cambrian on February 15, 2006, to satisfy $9.4 million of interest due on the debentures to March 24, 2007, and to fund additional infrastructure, plant and equipment costs associated with the Company's Wolverine coal mine project in northeast British Columbia and for general corporate purposes including working capital.

The projected capital costs of the Wolverine coal mine project remain on budget at C$242 million and the construction completion date remains on schedule for July 2006. The Company has supplied over 15 coal samples from Wolverine to a broad spectrum of mills representing most of the major international steel companies with very positive results and is currently negotiating price and volume commitments.

Forward-Looking Information

This release may contain forward-looking statements that may involve risks and uncertainties. Such statements relate to the Company's expectations, intentions, plans and beliefs. As a result, actual future events or results could differ materially from those suggested by the forward-looking statements. Readers are referred to the documents filed by the Company on SEDAR. Such risk factors include, but are not limited to changes in commodity prices; strengths of various economies; the effects of competition and pricing pressures; the oversupply of, or lack of demand for, the Company's products; currency and interest rate fluctuations; various events which could disrupt the Company's construction schedule or operations; the Company's ability to obtain additional funding on favourable terms, if at all; and the Company's ability to anticipate and manage the foregoing factors and risks. Additionally, statements related to the quantity or magnitude of coal deposits are deemed to be forward-looking statements. The reliability of such information is affected by, among other things, uncertainties involving geology of coal deposits; uncertainties of estimates of their size or composition; uncertainties of projections related to costs of production; the possibilities in delays in mining activities; changes in plans with respect to exploration, development projects or capital expenditures; and various other risks including those related to health, safety and environmental matters.


Gary K. Livingstone, President and Chief Executive Officer

Contact Information

  • Western Canadian Coal Corp.
    Gary K. Livingstone
    President & CEO
    (604) 608-2692
    Western Canadian Coal Corp.
    Fausto Taddei
    CFO & Corporate Secretary
    (604) 608-2692
    (604) 629-0075 (FAX)