Ramaco Resources executed a $30 million asset purchase agreement with companies owned by Coronado Global Resources Inc. to acquire the Amonate assets from Coronado.
The Amonate assets include a mine complex located in McDowell County, West Virginia, and Tazewell County, Virginia. All assets are located adjacent and contiguous to Ramaco’s existing Berwind mine complex. The acquisition primarily consists of approximately 50 million tons of low- and mid-volatile reserves, much of which will be mined from the Berwind mine. Also being purchased are several additional permitted mines, and a currently idled 1.3-million-ton-per-year capacity coal preparation plant.
Mine development on the Amonate reserves will begin immediately. Initial production is expected early in the second quarter of 2022, with total new incremental production for the entire year at approximately 200,000 tons. This will increase to approximately 700,000 tons at full production capacity by the end of 2023.
Capital expenditures for the new incremental tons are expected to be approximately $2 million in 2021 and $10 million in 2022.
Refurbishing of the existing Amonate preparation facility will also begin immediately, with 50% capacity utilization anticipated to be achieved by June 2022. Complete nameplate capacity of roughly 1.3 million t/y will be achieved by the end of 2022. Capital expenditure for the preparation plant upgrade is expected to be approximately $2 million in 2021, $6 million in 2022 and $2 million in 2023.
The company’s existing nearby Berwind mine is expected to reach full production capacity of roughly 750,000 low-volatile tons in mid-2022. By the end of 2023, together with the Amonate reserves, the combined mine complex will be capable of producing between 1.4-1.5 million low-volatile tons.
This will increase the company’s overall annual production capacity to approximately 3.7 million tons of met coal.