Fortune Minerals Renames BC Metallurgical Coal ProjectCanada Newswire
Mount Klappan Anthracite Coal Project now referred to as Arctos Anthracite Project
Issued Capital: 117,076,976
LONDON, ON, Aug. 21, 2012 /CNW/ - Fortune Minerals Limited (TSX-FT) (OTCQX-FTMDF) ("Fortune" or the "Company") (www.fortuneminerals.com) and POSCO Canada Ltd. ("POSCAN") are pleased to announce that effective immediately, the Mount Klappan Anthracite Metallurgical Coal Project in northwestern British Columbia ("BC"), Canada has been renamed the Arctos Anthracite Project. The project is owned by the Arctos Anthracite Joint Venture (formerly the Klappan Coal Joint Venture), a joint venture between Fortune (80%) and POSCAN (20%), the Canadian subsidiary of Korean steel producer POSCO, the world's third largest steel producer.
The name change signifies a new era for the proposed mine, and more accurately reflects the nature of the collaborative international development project. Robin Goad, President and CEO of Fortune, noted that the motivation to rebrand was rooted in the fact that the former name for the proposed development led to incorrect impressions. "The previous name led some people to believe that the project would involve mining the entire mountain, which is incorrect," said Goad. "In fact, our proposed mine involves an area north of the main peak around Lost Ridge."
The project principals have learned - through discussions with the Tahltan people over the past several years - that the Klappan area encompasses a vast region beyond that of Mount Klappan or the Klappan River watershed. Accordingly, use of the name Klappan can give the incorrect impression that the project will affect this entire area. In addition, a better appreciation of the significant spiritual and cultural importance of this area to the Tahltan and Iskut people contributed to the removal of the word Klappan from the project and joint venture names.
The new name - Arctos Anthracite Project - is a variant of the binomial nomenclature or 'naming convention' that is used to identify all living things. Ursus arctos most commonly refers to a brown bear, but the Greek word arctos was chosen in recognition that the bear is an enduring symbol of both strength and confidence. The choice of project name also reflects a desire to better acknowledge the land and environment in which the Arctos Anthracite Joint Venture operates. "It is our goal to take any steps we can to build respectful, trusting relationships with Aboriginal groups and others with interests in the area," said Yong Keun Kim, President of POSCAN. "The new name ensures that information on this project is clearer and can be better understood, but we hope that it also helps us take one of many small steps towards enduring strong relationships with the populations who reside in our operating regions."
The Arctos Anthracite Joint Venture is committed to the creation of a successful project in a manner that respects the land and its people. This means that the Arctos Anthracite Project will be developed in an environmentally sensitive manner that benefits Aboriginal people socially, culturally and economically. This will involve working in partnership with Aboriginal groups with interests in the area, relying on the most advanced mining and reclamation technologies in the industry, and committing to mining and transporting the anthracite coal in a sustainable manner that returns the land close to its previous state when the project is complete.
Arctos is one of the world's premier metallurgical coal deposits and the most advanced Canadian deposit of high rank anthracite coal - a key ingredient in steel and metal processing. Previous expenditures total over $90 million and have resulted in Measured Resources of 107.9 million tonnes, Indicated Resources of 123.0 million tonnes and Inferred Resources of 359.5 million tonnes1 (see News Release, dated June 22, 2004) and in-situ coal reserves of 106 million tonnes (see News Release, dated November 4, 2010). The project is located 330 km northeast of the port of Prince Rupert BC.
The Arctos licenses straddle the BC Railway right-of-way and its partially constructed roadbed, 150 km north of the current terminus of track at Minaret where CN is operating under a long-term lease. The rail transportation solution will allow trains to move the coal to Ridley Terminals in Prince Rupert, for export to customers around the world. The project is in the environmental assessment process ("EA") for the upgrade and expansion of the railway infrastructure and for the development of an open pit mine and wash plant that is expected to produce an initial 3 million tonnes per annum of premium ultra-low volatile pulverized coal injection ("PCI") products for the overseas steel industry. The EA process will include a comprehensive set of environmental, social, cultural and economic studies that will build on past work.
As previously announced, Marston Canada Ltd. ("Marston"), a division of Golder Associates Ltd., has been retained to update the geological model, coal reserves and feasibility study for the Lost Fox deposit area. The initial planned annual production rate will remain at 3 million tonnes per annum and the design of the process plant and railway infrastructure will not be changed from the previous Lost Fox feasibility study that was conducted by Marston in 2010. However, the capital and operating costs and financial model and sensitivities will be updated based on current information and potential for future expansion of the production rate. The updated Marston study will incorporate the results of additional drilling and survey data that was conducted earlier by Fortune as well as updated coal price assumptions that are anticipated to materially impact the reserves for the proposed mine. The new reserves and updated feasibility study are expected to be completed in the third quarter of 2012.
Fortune is concurrently working to secure additional strategic partner(s) to help finance the Arctos project and has engaged Deloitte & Touche Corporate Finance Canada Inc. ("Deloitte") as the Company's financial advisor. Deloitte was re-engaged after successfully helping Fortune secure POSCAN as a partner in the project. Deloitte will assist Fortune in identifying additional potential strategic partners and in evaluating potential transactions.
1The Arctos Anthracite Project Mineral Resource and Mineral Reserve estimates were prepared in 2004, 2005 and 2010, by Marston in compliance with National Instrument 43-101. Richard Marston, P.E. is the Qualified Person responsible for the estimates and supervising the preparation of the 2010 Lost Fox feasibility study. Further information regarding the Arctos Anthracite Project Mineral Resource and Mineral Reserve estimates and feasibility studies is available from the Company's disclosures under the Company's profile on the SEDAR website at www.sedar.com.
About Fortune Minerals:Fortune is a diversified resource company with several mineral deposits and a number of exploration projects, all located in Canada. The Company is focused on the development of the Arctos Anthracite Project in BC and the NICO gold-cobalt-bismuth-copper deposit in the Northwest Territories (NT). As part of the development of the NICO deposit, Fortune is developing the SMPP in Saskatchewan to process NICO concentrates to high value metal products. The Company has acquired and dismantled equipment from the Golden Giant Mine at Hemlo, Ontario for relocation to NICO. In addition, the Company owns the Sue-Dianne copper-silver-gold deposit and other exploration projects in the NT. Fortune is focused on outstanding performance and growth of shareholder value through assembly and development of high quality mineral resource projects.
This press release contains forward-looking information. This forward-looking information includes, or may be based upon, estimates, forecasts, and statements as to management's expectations with respect to, among other things, the generation of updated reserve estimates and an updated feasibility study for the Arctos project, the proposed development of and anticipated production from the Arctos project and the establishment of a railway link to Prince Rupert. Forward-looking information is based on the opinions and estimates of management at the date the information is given, and is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. These factors include the risk that the updated reserve estimates and feasibility study may not be available when expected or have the anticipated impact on the economics of the project, the risk that the Company may not be able to arrange the necessary financing to construct and operate the Arctos mine and/or the railway link to Prince Rupert, the risk that the Arctos Anthracite Joint Venture may be terminated in accordance with its terms, the risk that the Company may not be able to conclude an agreement with CN for the transportation of coal from the Arctos project to Prince Rupert, the possibility of delays in the commencement of production from the Arctos project, the inherent risks involved in the exploration and development of mineral properties, the risk that actual capital and operating costs for the Arctos project may differ from those anticipated, uncertainties with respect to the receipt or timing of required permits and regulatory approvals, the uncertainties involved in interpreting drilling results and other geological data, fluctuating metal prices and other factors. Readers are cautioned to not place undue reliance on forward-looking information because it is possible that predictions, forecasts, projections and other forms of forward-looking information will not be achieved by the Company. The forward-looking information contained herein is given as of the date hereof and the Company assumes no responsibility to update or revise such information to reflect new events or circumstances, except as required by law.