American Resources Corporation (NASDAQ:AREC) announced that it has started planning and development on another two carbon mines in Pike County, Kentucky, which will supply its McCoy Elkhorn complex.
American Resources told shareholders that the mines have a “low cost of development” and are capable of producing up to 45,000 tons per month.
The firm’s McCoy Elkhorn complex has a hub and spoke model, existing permits, two onsite carbon processing facilities and a rail load-out facility.
READ: American Resources receives $4.9 million in federal New Markets Tax Credits for its West Virginia coal complex
"Over the last seven years we have acquired, restructured and repositioned our extensive asset base enabling our carbon platform to deliver substantial organic growth that requires low capital investment,” American Resources COO Tarlis Thompson said in a statement.
Thompson called the firm’s platform “a unique source of growth within (the) industry” with more than 40 existing mining permits, five processing and logistics hubs, substantial remaining mine life and a high margin profile.
“Our team has dedicated substantial time and energy over the years to fully restructuring and repositioning these complexes to substantially streamline the facilities, their operations and our corporate overhead to enable a low cost structure and sustainable jobs for the community. Today these assets are in a position to unlock the value and take advantage of the strong global demand for carbon over the next few decades.”
The assets position American Resources as one of a few companies that can organically expand production to feed the demand especially while older mines in the region are coming to end of life, Thompson added.
Following the start of the next two mines, American Resources will begin planning the next phase of organic growth from McCoy Elkhorn. The firm is focused on organically expanding production to 1.5 million to 2 million tons per year.
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