Metallica Minerals (ASX: MLM) has advised it has lodged the MetroCoal Limited (MetroCoal) prospectus seeking to raise $10 million and list MetroCoal on the ASX in December 2009.
The offer is underwritten to the extent of $8.4 Million by Patterson’s Securities Limited as lead broker to the IPO. The offer is expected to open late this week.
The MetroCoal IPO is consistent with Metallica's strategy policy of giving non-core assets within Metallica’s
diversified portfolio - their own commodity focused entity - a coal and energy company, with its own management team, funding capability and ASX listing.
Investors may note earlier this year Cape Alumina (ASX: CBX) successfully achieved a $15 million IPO raising and ASX listing for the Bauxite assets held by Metallica. Cape ALumina shares are still trading around the IPO price.
Investment highlights of MetroCoal are:
- MetroCoal holds 100% of extensive coal tenements covering approximately 4,000km² in the Surat Basin region
- MetroCoal has identified thermal coal Exploration Targets totaling between 2.5 and 3.5 Billion tonnes and expects to confirm these targets within the next two years
- MetroCoal’s projects include the 100% owned Juandah thermal coal project area which has a 172Mt (149Mt inferred and 23Mt indicated) resource and this area represents only 1.5% of MetroCoal’s prospective coal tenements. This resource is based on just one coal seam, the Macalister Upper Seam
- The Macalister Coal Seam package is continuous and correlateable over most of MetroCoal’s tenements. The Macalister Upper Seam generally has a thickness and continuity that is highly prospective for longwall mining
- MetroCoal’s suite of tenements provides investors with excellent exposure to the increased global and domestic demand for energy
In addition to conventional coal exploitation, MetroCoal anticipates certain tenements will hold extensive thermal coal seams deeper than 150m below surface, suited to Underground Coal Gasification (UCG).
MetroCoal’s Juandah Project area is one of the few areas in Queensland that has no overlapping gas tenure. UCG is an attractive new source of cleaner coal energy, producing syngas for electricity generation and clean liquid fuels. UCG unlocks large quantities of previously stranded coal resources.
The coal and related energy sector, has had strong renewed investor interest this year, with strong demand from China and India.
Due to the maximum subscription of $10 million and the offer being underwritten to $8.4 million there is only $1.6 million available to Metallica and the general