Strategic Minerals (LON:SML) expects the closure of a nearby competitor to give a boost to its Tatu coal mine in New Zealand.
Huntly East, also on New Zealand’s North Island, sold coal with similar characteristics to Tatu’s, with many of its customers tailoring their operations for this coal type.
Strategic added it expects to complete its bulk sample programme at Tatu by the end of the year. By then, it also expects to have completed the acquisition of the outstanding 49% of the company that owns the mine.
Elsewhere, financing talks are underway over Strategic’s involvement in the Wanbao Coal Mine in China.
At the moment, it is looking at private equity sources but this would have to be confirmed before any firm commitment is made.
At the Cobre iron ore tailings project, revenues picked up in September and October as mine gate prices have held, reflecting the servicing of local markets;
Cash holdings were US$1.35mln at the end of September.
Alan Broome, non-executive chairman, said Strategic had also identified some interesting acquisition opportunities during a difficult time for global mineral markets, though Tatu would be the immediate focus.
"Over the next quarter, the board will be focused on completing the extraction and analysis of bulk sampling from the planned Tatu coal mine, as well as completing the acquisition of the remaining 49% interest in King Country Mining, the owner of the mine, including securing the requisite funding and sales interest.”
Finalising the work conducted to date on the Tatu feasibility study is also a priority, he said, as was finding a second expansion project and getting an extension of the Cobre sales contract beyond February.