American Resources Corporation (NASDAQ:AREC) revealed that the West Virginia Economic Development Authority (WVEDA) preliminarily approved the issuance of a $45 million tax-exempt Solid Waste Disposal Facility Revenue Bond, Series 2022, for the company's Wyoming County Coal (WCC) complex located near the town of Oceana, West Virginia.
The State of West Virginia has the authority to annually authorize the issuance of certain specified private activity bonds up to an annual amount determined under federal law. Such amounts for West Virginia for calendar year 2021 is $324,995,000.
On December 16, 2021, the WVEDA approved a resolution preliminarily approving the issuance of the bonds on behalf of the company's wholly owned subsidiary, Wyoming County Coal LLC, and allocated $45 million of West Virginia's 2021 volume cap to the bonds.
“This allocation will be carried forward to 2022 by the WVEDA and is expected to be issued by the WVEDA during the first half of 2022,” said the company. Citigroup Global Markets Inc. will underwrite the bonds, according to the company.
In a statement, American Resources CEO Mark Jensen said: "We're excited to have achieved this important milestone for our Wyoming County complex and our American Rare Earth division. The state of West Virginia has been great to work with and has been very supportive of the development of our advanced carbon and rare earth initiatives in the state.”
“This proposed funding source will enable us to efficiently modernize and transform the complex to be the first in the industry process for both carbon and rare earth concentrates…These technological improvements will provide us the capabilities to improve the environmental standards in the region by reprocessing certain carbon-based waste sources for their critical and rare earth elements, while offsetting costs through the overall operations.”
Jensen noted that he expects the company’s Wyoming County complex to support “well over 100 well-paying jobs in the region once reopened”.
The WCC complex is strategically located within one of the last substantial mid-volatile metallurgical carbon deposits and, with direct access to the Norfolk Southern (NYSE:NSC) Railway, provides favorable transportation logistics to the US east coast ports.
“Additionally, WCC is surrounded by a number of high-value metallurgical carbon reserves and remining sites that would otherwise be considered 'stranded' without access to the WCC processing and logistics complex,” said the company.
American Resources will initially focus on bringing the two new underground mines into production through a "walking super section" mine plan which will produce 55,000 tons of carbon per month, with further expansion potential as the mines are developed.
The company said it will also look to upgrade and expand WCC's carbon processing plant's capacity, from its current “350 tons per hour rate, to approximately 700 tons per hour”, while also incorporating the firm’s "capture" and "process" technology which will enable the facility to capture and process critical and rare earth elements from new carbon production and carbon-based waste sources to produce rare earth and critical element concentrates.
“The rare earth element (REE) and CE concentrates produced will be transported to the company's Indiana facility for further purification and isolation,” said the firm.
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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