American Resources Corporation (NASDAQ:AREC) revealed that it has completed the retrofit and rehab of its 1,300 ton per hour processing plant at its Perry County Resources (PCR) complex to begin to recover middling product during the carbon cleaning process.
The Fishers, Indiana-based supplier of raw materials to the rapidly growing global infrastructure market, estimated that the upgrade would increase the overall yield by over 5%. It said it will also reduce operating costs, resulting in a very attractive internal rate of return for the company.
In a statement, American Resources COO Tarlis Thompson said: "When we acquired the Perry County complex two years ago, it … needed significant rehabilitation to bring it back to its former operating capabilities. Our team has accomplished a majority of the daily run time items to more efficiently and effectively operate the complex, including reducing magnetite waste, downtime, utility costs and improved workforce efficiency and safety.”
READ: American Resources acquires mineral reserves for its Perry County Resources' E4-2 Deep Mine
“Now that we have achieved daily operational stability at the processing facility, we are in a position to further enhance our focus on high-return projects that improve both our output and environmental impact such as restarting the plant's middling circuit, which we believe has been idle for 10 years. The payback for this investment of time and capital will be achieved in less than three months as we continue our production ramp in the currently strong metallurgical carbon market,” he added.
The Perry County plant’s middling circuit targets carbon that possesses “a higher ash specimen than traditional PCI or mini stoker carbon produced at the PCR complex,” said the company. The product has historically been transported to the refuse storage disposal to be landfilled, which costs the company nearly $1.75 per ton. Each ton of middling's recovered saves the company money and creates a specialized product that will now be sold in the specialty carbon market, it added.
In addition, the middling recovery will help improve the environmental efforts of the PCR complex by keeping that captured carbon out of the refuse fill for the long-term.
"We estimate the addition of the middling circuit will produce approximately 7,500 additional sellable tons per month during 2022,” said Thompson. "We estimate additional potential sales from our middling circuit generating approximately $300,000 per month, beyond our PCI and stocker carbon sales in 2022, while at the same time saving the company over $13,000 in monthly operating and refuse costs.”
American Resources said it expects to begin marketing the product offering in the “coming weeks” and anticipates “strong demand."
The company is focused on the extraction and processing of metallurgical carbon, a key ingredient in steelmaking, rare earth minerals for the electrification market, and reprocessed metal to be recycled. American Resources has a growing portfolio of operations in the Central Appalachian basin of eastern Kentucky and southwest Virginia where premium quality metallurgical carbon and rare earth mineral deposits are concentrated.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
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