The firm said it was in a strong position to build on its portfolio in Pennsylvania, as it unveiled its results for the year to December 31, 2011.

In the 12 months, the firm saw increased production and sales from its Stockton colliery - with 207,005 tons of run-of mine coal unearthed and sales reaching 106,403 tons.

Revenues were strengthened to US$13.9 million compared to US$10.7 mln IN 2010.

The company said it reduced its group loss to US$3.15 million from a loss of US$5.09 mln in 2010.

The highlights of the current year include completion of the railroad diversion providing access to around 1.0 million tons of previously unworkable coal and a 12 per cent increase in production at Stockton and 24 per cent increase in average sales price experienced in the first quarter this year.

In January this year, it announced a lease option agreement with Pennsylvania-based Reading Anthracite Company which holds a permitted 410 acre anthracite mining property, believed to contain 4.1 million tons of clean coal.

In February, the company entered another option to acquire anthracite mining assets for a purchase price of US$35 million.

Atlantic Coal (LON:ATC) today said it had taken out an option on a second anthracite coal property in Pennsylvania, which could cost it US$35 million.

Because of the size of the potential deal it would amount to a reverse takeover and would require shareholder approval.

Atlantic said it had not yet started due diligence, which would take a number of months to complete.

There was no guarantee it would conclude a deal, it added. The option expires on 31 October.

Steve Best, Atlantic’s managing director, had said previously that its strategy was to expand in Pennsylvania and to build the company into a major US anthracite producer. 

Last month, Atlantic started due diligence on the 410 acre Pott & Bannon anthracite mining property also situated in Pennsylvania and where it also has an option to buy.

The Pott & Bannon property is situated in New Castle Township, Schuylkill County and about 25 miles from Atlantic’s existing open cast operation at Stockton.

It is estimated to contain reserves of 12 million tons Run of Mine at 3.9 ratio with 4.1 million tons of clean coal.

If it takes up its option, Atlantic will pay current owner Reading Anthracite (RAC) US$6 million in cash and shares for the property along with the grant of US$3 million in warrants to RAC.

Anthracite is the highest quality coal and used in steel making and power generation.

Atlantic will now pay US$250,000 to RAC with a further US250,000 to be held in escrow while it carries out due diligence on the property. 

If it takes up its option, Atlantic will pay US$6 million in cash and shares for the property along with the grant of US$3 million in warrants to RAC.

The Pott & Bannon property is situated in New Castle Township, Schuylkill County and about 25 miles from Atlantic’s existing open cast operation at Stockton.

It is estimated to contain reserves of 12 million tons Run of Mine at 3.9 ratio with 4.1 million tons of clean coal.

Atlantic has appointed John T. Boyd & Company to carry out due diligence and confirm the resource information provided, adding it intends to submit the permit transfer application shortly.

Last week, when the deal was announced, Atlantic’s managing director Steve Best said that taking the lease option was part of its strategy to expand in Pennsylvania and to build Atlantic Coal into a major anthracite producer in the US. 

Under the terms of the lease, RAC can buy all of the raw coal produced at the prospect until Atlantic makes a decision on whether to build a processing plant and up to 50% thereafter.

It says assuming both that the lease option is ratified by the board of the site's owner Reading Anthracite Company (RAC) and that due diligence is completed successfully, Atlantic has the potential to double its current rate of anthracite production and at a favourable strip ratio.

Atlantic announced this morning it had signed an option on the permitted site, which is 25 miles from its existing open pit coal mine at Stockton and also contains the same Mammoth Seam.

Atlantic estimates the new site, known as the Pott & Bannon anthracite mining property in Schuylkill County, contains 12 million tons of Run of Mine coal at a 3.9 ratio with 4.1 million tons of clean coal.

Subject to due diligence, Atlantic will pay US$6 million in cash and shares to RAC and grant it US$3 million worth of warrants at 0.75 pence per share.

Atlantic said that as well as developing its strategy of increasing its current reserves and production profile in the Pennsylvania Anthracitic Belt, it will allow it to build a commercial relationship with RAC, a firm that has been operating in the Pennsylvania area for 135 years.

The site is also in close proximity to major east-coast transportation hubs, it added.

Steve Best, Atlantic Coal's managing director, said: "We are extremely pleased to have been able to secure an option on this major site.  This agreement is in line with our growth strategy of expanding our regional footprint in this prime anthracite region, which has excellent infrastructure and established demand, and building Atlantic Coal into a major anthracite producer in the US.

Under the terms of the lease, RAC can buy all of the raw coal produced at the prospect until Atlantic builds a processing plant and up to 50% thereafter.

The $2.7 million cash component of the consideration will be sourced from Atlantic’s existing cash resources.

The lease will run for an initial period of 10 years and Atlantic will have the opportunity of extending the lease on the new site once it expires for two additional periods of 5 years each. 

Atlantic added it will try to achieve a minimum rate of production of 400,000t of run of mine coal in the second year of the lease. 

Its current operation at Stockton is an open pit colliery that sells mainly into the local central heating market and has reserves of 3.1 million tonnes of run-of-mine anthracitic coal, equating approximately to 1.5 million tonnes of washed anthracite after processing. 

The firm’s current target is to produce 300,000t of run-of-mine coal in 2011 after it reported a 65 per cent increase in the production of run-of-mine coal to 121,000t the first half of the year.

Shares were up 6% at 0.472p. Fox-Davies is Atlantic’s house broker.

US-focused coal miner Atlantic Coal (LON:ATC) has signed an option on a prospect in Pennsylvania that could double its anthracite reserves.

The lease option with Pennsylvania-based Reading Anthracite Company (RAC) is for a permitted 410 acre site 25 miles from Atlantic’s Stockton site and which also contains the Mammoth Seam that is being mined at Stockton. 

Atlantic estimates the new site contains 12 million tons of Run of Mine coal with 4.1 million tons of clean coal.

Subject to due diligence, Atlantic will pay US$6 million in cash and shares to RAC and grant it US$3 million worth of warrants at 0.75 pence per share.

Atlantic said that as well as developing its strategy of increasing its current reserves and production profile in the Pennsylvania Anthracitic Belt, the deal also has the potential to build a commercial relationship with RAC, which has been operating in the area for 135 years.

The site is also in close proximity to major east-coast transportation hubs, it added.

Steve Best, Atlantic Coal's managing director, said: "We are extremely pleased to have been able to secure an option on this major site.  This agreement is in line with our growth strategy of expanding our regional footprint in this prime anthracite region, which has excellent infrastructure and established demand, and building Atlantic Coal into a major anthracite producer in the USA.

Under the terms of the lease, RAC can buy all of the raw coal produced at the prospect until Atlantic builds a processing plant and up to 50% thereafter.

Pennsylvania-focused coal miner Atlantic Coal (LON:ATC) announced this morning that its shares are to be admitted to trading on the OTCQX ‘Pink Sheets’ platform in New York.

While the entire ordinary share capital of Atlantic will continue to trade on the Alternative Investment Market in London, a recently-established American Depositary Receipt (ADR) facility – for which BNY Mellon is acting as ‘depositary bank’ – will enable US investors to trade the firm’s shares.

Atlantic’s management team believes that the quotation on the OTCQX will benefit existing shareholders by making its shares more accessible to US investors, as well as providing the firm with increased visibility in the country where its primary asset is located.

Recently, Atlantic reported that revenues from its Stockton Colliery in Pennsylvania increased during the six months to the end of June by 55 per cent to US$7.5 million.

“We are delighted to have an ADR programme and to be quoted on OTCQX market today which is a key milestone for Atlantic in building market awareness in the company and expanding its shareholder base,” said Atlantic’s managing director, Steve Best.

“We already have a strong presence in the prime anthracite coal field through the Stockton Colliery, which has a current reserve of 3.1 million tons of run of mine anthracitic coal and we are committed to increasing this, in what is a prime anthracite coal field.  In line with this we have been evaluating various assets and the board believes that quotation on OTCQX will assist and strengthen our position in this regard."

Pennsylvania-focused Atlantic Coal (LON:ATC) boosted revenues and returned to gross profit during the first half of its current financial year thanks to progress at its Stockton Colliery.

Revenues for the six months to the end of June 2011 increased 55 per cent to US$7.5 million, while gross profit came in at US$843,106 (H1 2010: US$1 million gross loss). Atlantic reduced its net loss to US$1.1 million from US$1.5 million in H1 2010.

“We are making progress at Stockton as reflected by the increase in revenue and gross profit for the first six months of the current year,” said Steve Best, Atlantic Coal’s managing director. “Facilitated by the arrival of our first Liebherr [excavator] in June 2010, production at the mine has increased and we look forward to the arrival of the second excavator at the end of this year which we expect, when operational in the first quarter of 2012, will enhance excavation capacity and facilitate increased [run-of-mine] tons supplied to the wash plant.”

Stockton has a current reserve of 3.1 million tonnes of run-of-mine anthracitic coal, equating approximately to 1.5 million tonnes of washed anthracite after processing. The firm’s current target is to produce 300,000 tonnes of run-of-mine coal in 2011 that will be washed and sized for delivery to customers in the US and abroad.

Best added that Atlantic believed that coal fundamentals remain solid and, in tandem with the firm’s mine development, it is committed to increasing its resource base via acquisition.  “Both our cash position and management team have been strengthened during the period and I am confident that we will be able to use these to build on our progress to date during the current period,” he said.  

In February the firm raised £12 million from institutional and other investors. At the end of June it had US$15.7 million of cash on its balance sheet.

Atlantic Coal (LON:ATC) has agreed a deal to pay-off the loan note that was originally issued to the General Electric Capital Corporation.

Last December Mayford LLC, a company owned by managing director Steve Best and chairman Adam Wilson, bought the loan note for US$1.5 million in cash. Now Mayford have agreed to discharge the loan in full in return for a US$2.1 million upfront cash payment.

As of the 30 April 2011 the loan note was worth including all principal, accrued interest and penalty interest.

In a separate statement Steve Best told investors that Atlantic coal is undoubtedly positioned for further growth this year.

In a statement ahead of today’s AGM Best reflected on 2010, describing it as a year of success – in which increased production capacity and raised a total of £13.7 million in new capital.

“We now have the foundations in place to implement our strategy to increase our resource base, both organically and via acquisition and we look forward to the coming year with confidence.

"In light of our strengthened cash position, we have focussed on restructuring our balance sheet to a size more appropriate to that of the company.  Best said that this morning’s deal is the final stage of this process.

Speaking about the operation on the ground in Pennsylvania Best said: “The production outlook at the Stockton Colliery for 2011 remains positive.” 

“Our production profile for Q1 2011 was strong, nearing that of our best three months in 2010 in spite of severe weather conditions experienced during the period.  We are now focussed on boosting production further and to this end.” 

Best added: "The market conditions within the high quality coal industry are very conducive for growth, with strong local and international demand for our product, particularly from the steel industries in China and India.  

“This adds further incentive for increasing our resource base and to this end we continue to evaluate additional synergistic opportunities in Pennsylvania to consolidate our mining operations.  It should be noted that we have a stringent due diligence process in place to ensure that potential sites will provide significant uplift.”

A focus on production rates at Atlantic Coal (LON:ATC) in 2010 saw the firm boost its revenue by 18.5 percent during the year to US$10.7 million.

But the cost of investment in its activities, as well as a higher strip ratio of coal to overburden, led to an increased pre-tax loss for the year of US$5.1 million (2009: US$2.6 million).

Atlantic operates in Pennsylvania but its shares are quoted on the Alternative Investment Market, said that it increased its production capacity through sustained investment in its primary asset: the Stockton Colliery.

Stockton – an opencast anthracite mining and processing operation – has seen a new excavator put into service in order to develop the 3.2 million tons of run-of-mine coal reserves there. As a result production for the year was 207,873 tons of ROM coal, while 2,837,863 bank cubic yards of overburden was removed, compared with 232,499 tons of ROM coal and 1,804,435 BCYs in 2009.

The gross loss for the year was US$2 million (2009: US$1.7 million gross profit), partly as a result of the cyclical nature of the cut operation which resulted in a higher strip ratio of coal to overburden due to operations being nearer to the surface where less coal is recovered.

However, the firm said, with operations in the latter part of the year and Q1 2011 being in the cut basin the ratio has decreased. ROM production has increased and Atlantic anticipates that its production profile should continue to gain from the benefits of this during the course of 2011.

For the three months ended 31 March this year, Atlantic mined 125,148 tons of ROM and removed 658,785 BCYs of overburden (Q1 2010: 17,458 ROM and 651,866 BCYs).

Atlantic had cash of just US$292,433 on its balance sheet at the end of 2010, but it raised a further £12.3 million from two share placings earlier this year.

“2010 was a year of growth for Atlantic, during which our primary focus was on increasing our production rates.  With a strong cash position we believe that we are well funded to drive growth.   Additionally, we continue to evaluate other properties, both in the Pennsylvanian Anthracitic Belt and further afield, which we believe have the potential to be of benefit to the company,” said the firm’s chairman Adam Wilson.

Atlantic Coal’s production figures were applauded by broker Fox-Davies, which repeated its buy advice and 1.1 pence a share price target. The stock opened 0.015 pence, or 2 per cent higher, at 0.74 pence.

The company owns the Stockton opencast mine in Pennsylvania, which produces anthracite.

It is also carrying out due diligence on a 158-acre site close to Stockton, which could cost around $1.2 million to buy.

It is believed to contain 12 million tons of colliery spoil, with about 10-15 per cent recoverable coal, 1 million tonnes of silt and 2.5 million of coal that can be extracted via open-cast mining.  

Atlantic recently raised $12 million to fund acquisition opportunities as it bids to expand its base in the US.

Today’s update revealed the group mined 120,850 tons of run-of-mine coal and removed 658,785 bank cubic yards of overburden in the three months to the end of March. 

A total of 62,000 tons of coal was washed, which produced 28,376 tons of clean coal.  

More than 90,000 tons of good quality run-of-mine coal is also held as stock.  

Atlantic is increasing weekly working hours to increase production in the current quarter and remains on target to produce an estimated 450,000-500,000 tons of ROM for 2011.

Managing Director Steve Best said: "This has been a positive period for the company during which we have focused on driving growth in the business through increasing production at Stockton and identifying consolidation opportunities in the Pennsylvanian anthracite fields.  

"Our production profile for the last quarter was close to that of our best three months achieved in 2010, despite severe weather conditions experienced throughout the region, and I am confident that our committed investment at Stockton will continue to improve the mine economics and subsequently build shareholder value."

Atlantic Coal has unveiled plans to acquire another US anthracite operation as much as US$1.2 million. The AIM-listed group, which last month raised £12 million from investors, has secured an option to buy a 158-acre property in Pennsylvania, the base for the Stockton Mine.