PROPHECY RAISES $9 MILLION IN PLACEMENT

Prophecy Coal says $9 million raised in a non-brokered private placement will be poured into the relevant technical work requirements to bring its Chandgana thermal coal power project towards development.

The Canadian-listed company says the 600MW Chandgana mine-mouth power plant has been permitted and its Ulaan Ovoo coal mine is now in production.

Prophecy officially listed on the Toronto Stock Exchange in February this year, with the Mongolian Trade Commissioner and Mongolian Ambassador to Canada among invited guests at the listing ceremony.

In November 2011, the company received the licence from the Mongolian government to construct the power plant at its Chandgana site. During 2012, Prophecy is aiming to complete a power purchase agreement as well as the project’s financing. The company says once the power agreement is in place, institutional investors may come on board with the necessary equity funding to move the project towards construction in 2013.

Four Chinese companies have conducted project site visits, and several other international companies are interested in bidding on the project’s engineering, procurement and construction (EPC) contracts. It’s expected a successful contractor will be chosen by June.

A feasibility study announced in January for the US$744 million power plant confirmed positive economics for the project. Coal will be supplied by the Chandgana Tal deposit at an annual rate of 2.7 million tonnes with an as-received heat-value of 3350 kcal/kg. The delivered coal price is set at $15.50/tonne with a 2% semi-annual price increase.

Prophecy’s chief executive officer John Lee says, “The feasibility study has outlined the robust financial return for the Chandgana power plant based on conservative parameters. Our low-cost coal supply enables future delivery of affordable and stable electricity to central and eastern Mongolia. 




The opportunity represents a potential long term revenue stream from power plant operation, as well as from coal operation, without coal transportation issues.”

This fully-licensed power plant project has first-mover advantage to supplying Mongolia much needed electricity, which currently comes from antiquated plants totalling about 700MW.

Mongolia is one of the fastest growing countries in the past decade. The enormous Oyu Tolgoi copper-gold project, which is due to begin production in 2013, alone could boost Mongolia’s GDP by up to 30%. Prophecy says the growth and new wealth will urge the nation to invest in cleaner, more efficient and long-term stable domestic power infrastructure.

0 Response to "PROPHECY RAISES $9 MILLION IN PLACEMENT"

Post a Comment

Iklan Atas Artikel

Iklan Tengah Artikel 1

Iklan Tengah Artikel 2

Iklan Bawah Artikel