Jameson Resources Limited (ASX: JAL) is an exploration company. The Company explores and develops properties for coal deposits in British Columbia and Saskatchewan.
The company has recently released its investor presentation. The company has its flagship project located within Canada’s prolific Elk Valley coal field, which is the home to 5 operating mines.
Crown Mountain is situated in the mature mining region, proximal to a road network and an extensive rail system linking to three well-established deep-water coal ports. This facility’s production is estimated to be 84% hard coking coal, with a high relative CSR and low volatile content.
The high-quality nature of the North and East Block coking coal is comparable to the benchmark Low Vol Premium Hard Coking Coal produced globally. Crown Mountain represents a very lucrative opportunity for the development of a coking coal project with an attractive operating cost structure.
The Pre-Feasibility Study update has confirmed a total reserve base at Crown Mountain of 56 million tonnes. Confidence in the geologic interpretation is high, as nearly 90% of the reserves are in the Proven category.
Plant yields were estimated based on the summer 2013 exploration program. Average LOM plant yield is 53%. Early years (North Block) plant yield is 61%. The clean coal strip ratio for the first four years averages a low 7.5:1 BCM:t, and 9.8:1 LOM.
As regards the pre-feasibility study update, the company has briefed the following:
- FOB cash cost of US$75/t life-of-mine (US$66/t first four years)
- Hard Coking Coal (HCC) comprises 84% of total clean coal production (balance is PCI)
- Clean coal sales average 1.7 million tpa over a 16-year mine life
- After-tax Payback Period of 2.3 years
- IRR is 40% pre-tax (31% after tax)
- NPV10 US$440 million pre-tax (US$267 million after-tax)
- Start-up capital US$281 million (pre-contingency)
- Life of mine clean coal strip ratio of 9.8:1 BCM:t (7.5:1 BCM:t in first four years) supports low-cost open pit production
- Coal sales prices assumed are significantly lower than the current market.
As regards the critical projects for FY 2019, the application for an Environmental Assessment Certificate is well advanced. Design engineering is in progress on the spoil pile design, and a BFS is anticipated to commence once final laboratory analysis on coal core samples taken during the summer’s exploration program has been completed.
The company has got significant investors on board and to substantiate this fact, a subsidiary of Bathurst Resources Limited (ASX: BRL) has now committed to investing up to C$121.5 million cash in Crown Mountain. BRL now owns 8% of Jameson’s NWP Coal Canada Ltd subsidiary, which holds a 90% interest in Crown Mountain.
Now, let’s have a glance at Jameson Resources Limited’s stock performance and the return it has posted over the past few months. The stock last traded at a price of $0.16, with a market capitalisation of ~$ 42.20 Mn. The stock has provided a YTD return of -5.88% & also posted returns of -17.95%, -3.23% & -5.88% over the past six months, three & one-months period respectively. It had a 52-week high price of $ 0.260, with an average volume of ~455,024.
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