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Friday, 18 January 13
NEWLEAD HOLDINGS LTD. TO ACQUIRE TWO COAL PROPERTIES WITH ESTIMATED COAL RESERVES OF 18.6 MMT & 143.1 MMT
 NewLead Holdings Ltd. Announces Signing Agreement to Acquire Properties with Estimated Coal Reserves of 18.6 Million Tons; Signing Agreement to Acquire Properties with Estimated Coal Reserves of 143.1 Million Tons and Securing 3-year Coal Supply Contracts Expected to Generate $873.5 million of Revenue
NewLead Holdings Ltd., is an international, vertically integrated shipping and commodity company that manages product tankers and dry bulk vessels, yesterday announced that the Company has entered into an agreement to acquire title and excavation rights in properties containing 18.6 million tons of estimated coal reserves for $11.0 million.
According to a press release posted on Company’s website, NewLead also entered into an agreement to acquire ownership and leasehold interests in properties containing approximately 143.1 million tons of coal for $55.0 million. Michael Zolotas, President and Chief Executive Officer of NewLead, stated, "We have expanded our recently launched commodities business with the agreement to acquire an estimated 18.6 million tons of coal reserves. We are in the process of acquiring additional coal properties with reserves estimated at approximately 143.1 million tons. Once we have acquired all of the assets, our coal reserves will consist primarily of sub bituminous B coal, which is 13,500 BTU with low sulfur. We will also have 'Blue Gem' and 'Rich Mountain' seams of coal, highly sought after in the international market. We believe that our international shipping expertise will allow us to exploit the demand for these coal reserves."
Michael Zolotas continued, "In entering the mining business, we undertook to secure supply contracts for the coal reserves. Consequently, we entered into two agreements to supply coal to third parties. These agreements are expected to generate $873.5 million of revenue over a three-year period. Based on our projections of operating costs, we believe that these sales will have healthy margins and will generate significant cash flow with which to fund continued growth. We intend to supplement the supply agreements by allowing contract miners to mine and pay us a royalty for coal removed."
Coal and Natural Gas Reserve Acquisitions
As of December 28, 2012, NewLead entered into an agreement to acquire title and mineral excavation rights to 5,000 acres of land in Kentucky. The coal reserves in these properties are estimated to be approximately 18.6 million tons. The transaction is subject to execution and delivery of certain definitive agreements and other closing conditions, but is currently expected to close by January 29, 2013. There can be no assurance that the transaction will be consummated. The consideration of $11.0 million was paid in the form of notes maturing on January 29, 2013. The notes do not accrue interest, but remain subject to a guaranty by the initial purchaser and are secured by a mortgage lien and a security interest in the assets being purchased.
NewLead has also entered into an agreement to acquire ownership and leasehold interests in 18,335 acres in Tennessee containing coal and natural gas and other natural resources. The agreement contemplates that the Company will acquire rights, title, permits and leases to coal mines with total reserves estimated at 143.1 million tons. The transaction is subject to execution and delivery of certain definitive agreements and other closing conditions, but is currently expected to close in February 2013. There can be no assurance that the transaction will be consummated. The agreement contemplates that consideration of $55.0 million shall be payable in cash in two installments; $30.0 million at closing and the remaining $25.0 million on the first anniversary of the closing.
The estimated reserves stated above are as determined by independent appraisals. The methodology used by the independent appraisers was not compliant with the methodology required by the Securities and Exchange Commission ("SEC") in reserve reports and, accordingly, should not be relied upon. Such reserve information is only provided to give the best currently available information. NewLead is undertaking to obtain reserve reports that comply with SEC methodology. Such reports may differ materially from the information provided herein.
The properties in Tennessee and Kentucky also include natural gas wells and projects relating to extraction of timber, sand, gravel, fly ash and dimension stone. Third parties are currently extracting these commodities on the properties and paying royalties.
Coal Supply Contracts
NewLead signed two coal supply contracts with creditworthy counterparties for the sale of coal to such parties. Annual revenue from these two contracts is expected to be $184.7 million in the first year, $318.4 million in the second year and $370.4 million for the third and final year.
The first contract provides for the sale of 70,000 tons of coal per month for the first 12 months (840,000 tons annually), increasing to 140,000 tons per month for the second year (1.68 million tons annually) and 210,000 tons per month for the third year (2.52 million tons annually). All tonnage is subject to a variation of 5%. The price was established based on the prevailing market price for coal at the time the contract was entered into.
The second contract provides for the sale of 130,000 metric tons per month for the first 12 months (1.56 million metric tons annually), increasing to 210,000 metric tons per month for the second and third years (2.52 million metric tons annually). All tonnage is subject to a variation of 5%. The price was established based on the prevailing market price for coal at the time the contract was entered into.
NewLead intends to source the coal to meet such contracts from the estimated reserves discussed above, but to the extent it is unable to do so, it will be required to seek to source the coal from other suppliers at the prevailing prices.
Management Company
NewLead also entered into an agreement to acquire a local coal mining management company in exchange for compensation, paid in the form $3.0 million in common shares of NewLead and a warrant for $6.4 million in common shares of NewLead. Such acquisition is subject to a number of terms and conditions and there is no assurance it will be consummated. The management company shall be responsible for managing the daily operations of the coal mines and the excavation of the coal from the properties.
For more details please visit www.newleadholdings.com.
Source: NewLead Holdings
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Tuesday, 05 December 17
OIL PRICES HAVE GAINED SOME TRACTION THESE PAST FEW DAYS ON TALKS OF ANOTHER OPEC & RUSSIA PRODUCTION CUT EXTENSION - GERRY LATHROP
Oil prices have gained some traction these past few days on talks of another OPEC (including non-OPEC Russia) production cut extension.
The cu ...
Tuesday, 05 December 17
THE COKING AND THERMAL COAL RECORDING SMALL GAINS - DANIEL HYNES
Coal markets were higher, with both coking and thermal coal recording small gains, said Daniel Hynes Senior Commodity Strategist at ANZ in his late ...
Tuesday, 05 December 17
WEEKLY US COAL PRODUCTION ESTIMATES DIP WEEK OVER WEEK - EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 14.1 million short ton ...
Thursday, 30 November 17
CONTEMPLATING COAL'S CONTROVERSY AT COP23 - BENJAMIN SPORTON
Representing the coal industry at climate talks is never going to be an easy proposition. For many people, coal and climate action are incompatible ...
Wednesday, 29 November 17
THE LAST DAYS OF COAL? - ALIBRA SHIPPING
At least 15 countries have joined an international alliance to phase out coal use for power generation before 2030.
Britain, Canada, Denmark, ...
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Showing 1861 to 1865 news of total 6871 |
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- CNBM International Corporation - China
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- IHS Mccloskey Coal Group - USA
- Formosa Plastics Group - Taiwan
- Ministry of Transport, Egypt
- Port Waratah Coal Services - Australia
- PetroVietnam Power Coal Import and Supply Company
- GMR Energy Limited - India
- Orica Australia Pty. Ltd.
- Attock Cement Pakistan Limited
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- Semirara Mining Corp, Philippines
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- Semirara Mining and Power Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Economic Council, Georgia
- Meenaskhi Energy Private Limited - India
- Metalloyd Limited - United Kingdom
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- Indian Energy Exchange, India
- Global Coal Blending Company Limited - Australia
- Bukit Makmur.PT - Indonesia
- Australian Commodity Traders Exchange
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- Tamil Nadu electricity Board
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- Jindal Steel & Power Ltd - India
- MS Steel International - UAE
- Mintek Dendrill Indonesia
- Parliament of New Zealand
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- Wood Mackenzie - Singapore
- Xindia Steels Limited - India
- The State Trading Corporation of India Ltd
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- Coalindo Energy - Indonesia
- The Treasury - Australian Government
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- Petron Corporation, Philippines
- Minerals Council of Australia
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- Sarangani Energy Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Merrill Lynch Commodities Europe
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- Ministry of Mines - Canada
- Savvy Resources Ltd - HongKong
- Banpu Public Company Limited - Thailand
- GVK Power & Infra Limited - India
- Vizag Seaport Private Limited - India
- Goldman Sachs - Singapore
- Barasentosa Lestari - Indonesia
- Bulk Trading Sa - Switzerland
- Africa Commodities Group - South Africa
- Mjunction Services Limited - India
- Trasteel International SA, Italy
- Aditya Birla Group - India
- Ind-Barath Power Infra Limited - India
- European Bulk Services B.V. - Netherlands
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- Deloitte Consulting - India
- Carbofer General Trading SA - India
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- Energy Development Corp, Philippines
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- Eastern Energy - Thailand
- Binh Thuan Hamico - Vietnam
- Edison Trading Spa - Italy
- Siam City Cement PLC, Thailand
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- Romanian Commodities Exchange
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- Cigading International Bulk Terminal - Indonesia
- Price Waterhouse Coopers - Russia
- Indonesian Coal Mining Association
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- Agrawal Coal Company - India
- Directorate Of Revenue Intelligence - India
- Indika Energy - Indonesia
- McConnell Dowell - Australia
- Asmin Koalindo Tuhup - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Electricity Authority, New Zealand
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- Eastern Coal Council - USA
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- Planning Commission, India
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- Electricity Generating Authority of Thailand
- Alfred C Toepfer International GmbH - Germany
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- Videocon Industries ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Singapore Mercantile Exchange
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- Bangladesh Power Developement Board
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- San Jose City I Power Corp, Philippines
- Jaiprakash Power Ventures ltd
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- The University of Queensland
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- Bhoruka Overseas - Indonesia
- Oldendorff Carriers - Singapore
- Medco Energi Mining Internasional
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- Heidelberg Cement - Germany
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- White Energy Company Limited
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- Commonwealth Bank - Australia
- Samtan Co., Ltd - South Korea
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