TIDMAPF
RNS Number : 6859C
Anglo Pacific Group PLC
21 January 2015
News Release
January 21, 2015
Anglo Pacific Group PLC
Kestrel Update
Anglo Pacific Group PLC ("Anglo Pacific" or the "Company") (LSE:
APF, TSX: APY), the London and Toronto listed royalty company, is
pleased to provide an update on Kestrel, the Company's main
producing royalty, following the operational update by Rio
Tinto.
-- Gross royalty income from Kestrel expected to be
approximately GBP1.7m for 2014. Total gross royalty income from
Anglo Pacific's royalty portfolio for 2014 expected to be in the
region of GBP3.2m to GBP3.6m (as per the Company's trading update
on January 9, 2015)
-- Kestrel produced 2.7Mt of coal in 2014 (2.16Mt of hard coking
coal and 0.56Mt of thermal coal)
-- Kestrel production rate expected to reach full capacity of
5.7Mt of coal per year within the next 12 to 18 months
-- Anglo Pacific expects royalty income from Kestrel to increase
substantially as mining returns to the Company's royalty lands
during 2015
-- Anglo Pacific expects Rio Tinto to mine over 90% of coal
within the Company's royalty lands by 2017
The Kestrel Mine
The Kestrel mine is a low cost underground coking and thermal
coal mine in Queensland, Australia operated and 80% owned by Rio
Tinto and 20% owned by Mitsui. Rio Tinto completed in 2013 a US$2bn
capital expenditure programme to extend the mine life (18 years
remaining) and increase production capacity to 5.7Mtpa.
Kestrel production for 2014 was 2.7Mt of coal (2.16Mt of hard
coking coal and 0.56Mt of thermal coal). During Q4 2014 the Kestrel
mine underwent a long wall change out which significantly reduced
overall mined tonnage. The Kestrel production rate is expected to
reach full capacity of 5.7Mt of coal per year within the next 12 to
18 months as the mine continues to ramp up.
Kestrel Production
Q1 2014 Q2 2014 Q3 2014 Q4 2014 Full Year
2014
---------------- -------- -------- -------- -------- ----------
Hard coking
coal ('000
tonnes) 781 613 621 149 2,163
---------------- -------- -------- -------- -------- ----------
Thermal coal
('000 tonnes) 88 109 56 311 564
---------------- -------- -------- -------- -------- ----------
Kestrel is a low cost operation. On a global benchmark
comparison, operations at Kestrel are well positioned on the hard
coking coal cost curve. The CRU Group forecasts Kestrel to be
located at the low end of the first quartile of the global seaborne
hard coking coal business costs 2015E cost curve.
Please refer to
http://www.anglopacificgroup.com/pdf/KestrelUpdateQ12015.pdf for
Kestrel's position on the CRU 2015E forecast global seabourne hard
coking coal cost curve.
The Kestrel Mine - Anglo Pacific Royalty Areas
Anglo Pacific's royalty applies to approximately 49% of the
current authorised mining lease tenure.
Anglo Pacific estimates that the Rio Tinto forecast for mining
within the Anglo Pacific royalty lands during H1 2015 represents
20-25% of production and approximately 70-75% during H2 2015.
Anglo Pacific expects Rio Tinto to mine over 90% of coal within
our royalty lands by 2017.
Please refer to
http://www.anglopacificgroup.com/pdf/KestrelUpdateQ12015.pdf for a
map of Anglo Pacific's royalty lands and Kestrel's mining
leases.
Note: Rio Tinto lodged Mining Lease application 70481 on 4
October 2012. If approval of ML70481 is granted then Anglo
Pacific's option to collect royalties from coal sales will continue
for longer in terms of overall mine life.
Kestrel Royalty Terms
Anglo Pacific royalty terms: 3.5% of value up to A$100/tonne,
6.25% of the value over A$100/tonne and up to A$150/tonne, 7.5%
thereafter(2)
(2) Royalty terms presented on a 50% basis attributable to Anglo
Pacific. The royalty rate is set by the Queensland Government.
For further information:
Anglo Pacific Group PLC
+44 (0) 20 3435 7400
Julian Treger, Chief Executive Officer
Mark Potter, Chief Investment Officer
Website:
www.anglopacificgroup.com
Bell Pottinger
+44 (0) 20 3772 2500
Nick Lambert / Lorna Cobbett
Notes to Editors
About Anglo Pacific
Anglo Pacific is a global natural resources royalty company. The
Company's strategy is to develop a leading international
diversified royalty company with a portfolio centred on base metals
and bulk materials, focusing on accelerating income growth through
acquiring royalties on projects that are currently cash flow
generating or are expected to be within the next 24 months. It is a
continuing policy of the Company to pay a substantial portion of
these royalties to shareholders as dividends.
Cautionary statement on forward-looking statements and related
information
Certain information contained in this announcement, including
any information as to future financial or operating performance and
other statements that express management's expectation or estimates
of future performance, constitute "forward looking statements". The
words "expects", "anticipates", "plans", "believes", "estimates",
"seeks", "intends", "targets", "projects", "forecasts", or negative
versions thereof and other similar expressions identify
forward-looking statements. Forward-looking statements are
necessarily based upon a number of estimates and assumptions that,
while considered reasonable by management, are inherently subject
to significant business, economic and competitive uncertainties and
contingencies. Further, forward-looking statements are not
guarantees of future performance and involve risks and
uncertainties which could cause actual results to differ materially
from those anticipated, estimated or intended in the
forward-looking statements. Furthermore, this announcement contains
information and statements that are based on certain estimates and
forecasts that have been provided to the Group by Kestrel Coal Pty
Ltd ("KCPL"), the accuracy of which KCPL does not warrant and on
which readers may not rely. The material assumptions and risks
relevant to the forward-looking statements in this announcement
include, but are not limited to: stability of the global economy;
stability of local government and legislative background;
continuing of ongoing operations at the properties underlying the
Group's portfolio of royalties in a manner consistent with past
practice; accuracy of public statements and disclosures (including
feasibility studies and estimates of reserve, resource, production,
grades, mine life, and cash cost) made by the owners and operators
of such underlying properties; accuracy of the information provided
to the Group by the owners and operators of such underlying
properties; no material adverse change in the price of the
commodities produced from the properties underlying the Group's
portfolio of royalties and investments; no material adverse change
in foreign exchange exposure; no adverse development in respect of
any property in which the Group holds a royalty or other interest,
including but not limited to unusual or unexpected geological
formations and natural disasters; successful completion of new
development projects; planned expansions or additional projects
being within the timelines anticipated and at anticipated
production levels; and maintenance of mining title. If any such
risks actually occur, they could materially adversely affect the
Group's business, financial condition or results of operations. For
additional information with respect to such risks and
uncertainties, please refer to the "Principal Risks and
Uncertainties" section of our most recent Annual Report and to the
"Risk Factors" section of our most recent Annual Information Form
available on www.sedar.com and the Group's website
www.anglopacificgroup.com. Readers are cautioned to consider these
and other factors, uncertainties and potential events carefully and
not to put undue reliance on forward-looking statements. The
forward-looking statements contained in this announcement are made
as of the date of this announcement only and the Group undertakes
no obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events
or otherwise, after the date on which the statements are made or to
reflect the occurrence of unanticipated events.
Third party information
As a royalty holder, the Group often has limited, if any, access
to non-public scientific and technical information in respect of
the properties underlying its portfolio of royalties, or such
information is subject to confidentiality provisions. As such, in
preparing this announcement, the Group has largely relied upon the
public disclosures of the owners and operators of the properties
underlying its portfolio of royalties, as available at the date of
this announcement.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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