Bens Creek Group PLC's (AIM:BEN, OTC:BENCF) progress with a newly installed highwall miner, HWM 81, has been stifled temporarily due to an incident that damaged the equipment.
The company, in a statement, noted that HWM 81 requires repair after the incident, which occurred during regular operations. US regulations require that the Department of Labor's, Mine Safety and Health Administration examine and approve any recovery or retrieval plan, before the equipment is retrieved.
Such an approval has now been received, it has now been retrieved and the company expects that HWM 18 will be back in full production by the middle of August 2023. Other than the temporary dip in production the company said that no other costs relating to this incident will fall to Bens Creek.
The company added that it remains confident that it will fulfil all its current orders.
In the period between 1 October 2022 and 31 March 2023 the company produced some 172,390 tonnes of clean metallurgical coal, Bens Creek reported today,
"While we were disappointed about the incident, we are pleased that no injuries occurred,” said Ben's Creek chief executive Adam Wilson. “We are delighted that MSHA moved quickly to assist us in approving the recovery plan and we are hopeful that we will be back to full operation within a few weeks.”
Meanwhile, amid commodity price volatility, the company has – via its subsidiary Bens Creek Operations LLC – issued a loan note to major shareholder Avani Resources which has agreed to provide up to US$6.5 million of new capital.
An agreement with Avani will see Bens Creek Operations repay to the lender US$2 per tonne of clean coal sold within 7 business days of production, and the balance will be repayable in accordance with the loan note agreement with Avani.
Wilson added: “Our new shareholder, Avani, has quickly evidenced their commitment to the business by putting in place this term loan to ensure that our working capital is maintained during this extended period of pressure on coal prices."