PRAIRIE MINING LIMITED
NEWS RELEASE | 11 OCTOBER 2016
ACQUISITION OF THE STRATEGIC LARGE SCALE DEBIENSKO HARD COKING COAL PROJECT IN SOUTHERN POLAND
Prairie Mining is pleased to announce that it has acquired the Debiensko Hard Coking Coal Project, a fully permitted, „mine ready” project of significant global scale. This is a transformational acquisition marking Prairie’s entry into the hard coking coal sector, complementing Prairie’s advanced Lublin Coal Project, and creating a multi-project coal development company based in Poland to fuel European industry.
Prairie believes Debiensko has the potential to become a strategically important supplier to the European steelmaking industry and will actively pursue Debiensko’s development alongside its continued progress at its flagship Lublin Coal Project.
• Debiensko is a world class, fully permitted, hard coking coal project situated in Upper Silesia in Poland, a strategic location in the steelmaking heartland of Europe where more than 80% of current coking coal usage is imported and the commodity is classified by the EC as a „Critical Raw Material”.
• A large scale Coal Exploration Target has been estimated based on historical drilling and resource work completed to Polish standards, as well as data from adjacent operating mines. Coal seam qualities are indicative of internationally traded benchmark premium hard coking coals.
Table 1: Exploration Target Range
Depth Exploration Target Tonnage Range (Mt)
All seams to depth approx. 1,100 m* 120 Mt – 150 Mt
Depth 1,100 – 1,250 m 90 Mt – 110 Mt
Total 210 Mt – 260 Mt**
Quality*** Moisture Ash Volatile Matter Sulphur FSI
Weighted Average Whole
Exploration Target Range (+/-20%) 0.7 – 1.1 6.3 – 9.5 18.1 – 27.1 0.6 – 0.8 5½ – 8
* Depths are from surface – c250 m above datum
**Figures are reported to the nearest 10 Mt which is deemed appropriate for this level of estimation
***Figures are reported to one decimal place which is deemed appropriate for this level of estimation
The potential quantity and grade of the exploration targets are conceptual in nature and there has been insufficient exploration to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource.
•Debiensko is fully permitted with a 50-year mining concession, established on-site facilities including rail, road and power infrastructure, comprehensive historical drilling data and all environmental consents. As a brownfield development project, significant historical capital investment positions Debiensko to become a meaningful, near-term regional hard coking coal producer.
•Prairie intends to undertake a work program to review all historic data, undertake an in-fill drill program, provide an updated resource to JORC standards and deliver a re-engineered mine plan to produce a Feasibility Study to international standards with a focus on near term production.
•Prairie has acquired the Debiensko project through the purchase of 100% of the shares in NWR Karbonia S.A for an upfront cash consideration of €0.5m (~A$0.7m) and deferred cash consideration of €1.5m (~A$2.2m).
•Through this acquisition, Prairie acquires a highly experienced team of Polish mining specialists including engineers, mine managers, mine planners, geologists, surveyors and environmental specialists that brings substantial synergies to expedite permitting and development of Prairie’s flagship Lublin Coal Project.
„For a long time, Debiensko has been regarded as the last major undeveloped hard coking coal project in Europe” said Ben Stoikovich, Chief Executive Officer of Prairie. „This transaction not only marks Prairie’s entry into the hard coking coal sector through ownership of a strategically located and fully permitted asset on the doorstep of Central European steelmakers, but also further cements our belief in the future of the Polish coal mining industry.”
Founder and Managing Partner of CD Capital, Carmel Daniele said: „CD Capital, as a cornerstone investor in Prairie, is very excited about the company’s successful addition of a second coking coal project. We are long-term investors and partners in the group and we are committed to working with Prairie’s management team to realise the full development potential of its projects. The acquisition of the Debiensko hard coking coal project, together with the semi-soft coking coal from Prairie’s flagship Lublin Coal Project, will position Prairie to be the next strategic coking coal supplier to Europe’s steel industry.”
For further information contact:
Ben Stoikovich Artur Kluczny Sapan Ghai
Chief Executive Officer Group Executive – Poland Communications
+44 207 478 3900 +48 22 351 73 80 +44 7557 055 166