VANCOUVER, May 6 /PRNewswire-FirstCall/ -- Western Canadian Coal Corp (TSX: WTN, WTN.WT and WTN.DB and AIM: WTN) (the "Company" or "Western") announces today, further to the Company's announcement of February 29, 2008, that it has closed the transaction to acquire Falls Mountain Coal Inc. ("FMC") from Cambrian Mining plc ("Cambrian").
The Company believes that the acquisition of FMC will result in a number of significant benefits, including:
- Increase the Company's run-of-mine coal reserves by approximately 15.7 million tonnes or by 18%. The FMC reserves consist of approximately 60% PCI coal and 40% hard coking coal ("HCC"); - Allow the Company to begin producing PCI coal from Willow Creek as soon as September 2008 to take advantage of the record coal prices in the current coal year, - Increase Western's market presence as a global leader in the PCI coal market segment and through a blend of Wolverine and Willow Creek HCC, produce a premium HCC product unique to the marketplace; and, - Synergies created between the Brule mine and Willow Creek mine which will reduce operating, transportation and overhead costs. About Falls Mountain Coal
FMC owns the Willow Creek coal properties, wash plant and rail load out facilities and are located in northeast British Columbia. Willow Creek is located close Western's Brazion Group of assets, which includes the Brule mine. The wash plant has a current annual capacity of 2.2 million tonnes. With certain modifications, the wash plant can be expanded to approximately 3.0 million tonnes of annual capacity to handle coal from both Brule and Willow Creek. The ability to process coal at Willow Creek's facilities will eliminate the need for the Company to construct a wash plant and load out facility at Brule. The Company expects to restart operations at Willow Creek in the second quarter of fiscal year 2009 with initial plans to produce up to 60,000 tonnes per month of PCI coal. The net book value of the assets is approximately $28.1 million.
About Cambrian
Cambrian is a diversified mining house that manages and supports operations in coal and gold/antimony mining. The Group has been instrumental in the past three years in supporting the development of a number of mines and moving them into production. These include: the Augusta gold and antimony mine in Victoria, Australia; the Wolverine hard coking coal mine in Western Canada; the Dillon and Brule PCI mines in Western Canada as well as metallurgical and thermal coal mines in West Virginia, USA.
Cambrian, through its wholly-owned subsidiaries, currently holds approximately 48.4 million common shares of Western, representing approximately 38% of Western's issued and outstanding shares. Mr. John Byrne, Chairman of Western, is also Chairman of Cambrian and holds approximately 6.9% of the outstanding shares of Cambrian. Mr. John Conlon, a director of Western, is also a director of Cambrian and holds approximately 0.9% of the outstanding shares of Cambrian.
About Western Canadian Coal
Western Canadian Coal Corp. produces 3.7 million tonnes of high quality metallurgical coal from three mines located in the northeast of British Columbia. The Company also has interests in various coal properties in northern and southern British Columbia and a 50% interest in the Belcourt Saxon Limited Partnership, which was formed to explore and develop the Belcourt and Saxon group of properties in northern BC. Currently, these properties provide the Company with an estimated 15 years of coal reserves at current production levels.
Forward-Looking Information
This release may contain forward-looking statements that may involve risks and uncertainties. Such statements relate to the Company's expectations, intentions, plans and beliefs. As a result, actual future events or results could differ materially from those suggested by the forward-looking statements. Readers are referred to the documents filed by the Company on SEDAR. Such risk factors include, but are not limited to changes in commodity prices; strengths of various economies; the effects of competition and pricing pressures; the oversupply of, or lack of demand for, the Company's products; currency and interest rate fluctuations; various events which could disrupt the Company's construction schedule or operations; the Company's ability to obtain additional funding on favourable terms, if at all; and the Company's ability to anticipate and manage the foregoing factors and risks. Additionally, statements related to the quantity or magnitude of coal deposits are deemed to be forward-looking statements. The reliability of such information is affected by, among other things, uncertainties involving geology of coal deposits; uncertainties of estimates of their size or composition; uncertainties of projections related to costs of production; the possibilities in delays in mining activities; changes in plans with respect to exploration, development projects or capital expenditures; and various other risks including those related to health, safety and environmental matters.
CONTACT: David Jan, Manager, Investor Relations & Corporate Development, Phone: (604) 608-2692, Email:
