Pine Valley gains funds for coal mine

Vancouver — A buoyant market for metallurgical coal is making it easy for Western Canadian coal companies to place new mines into production. The list includes the Willow Creek coal mine, scheduled to begin operations later this summer.

Owner Pine Valley Mining (pvm-v) recently completed a $10-million financing to build and operate a mine capable of producing at an annual rate of 1.1 million tonnes. The mine is near Chetwynd, in the heart of northeastern British Columbia’s coal-mining district.

Marubeni of Japan provided the financing, and agreed to buy 600,000 tonnes of coal over the first two years. The first coal sales are expected this summer.

Pine Valley is negotiating other contracts and intends to sell to important steel-producing regions, such as China, Europe and the U.S. The company says it sent samples of its low-sulphur, low-ash product to steel mills all over the world and received several expressions of interest to buy coal once the mine begins production.

Pine Valley says it is pleased to have agreements with Marubeni, a trading company active in the pulverized coal injection (PCI) market, the primary type of coal to be produced at Willow Creek.

Vancouver-based Pine Valley views itself as a major new “unhedged producer” of low volatile PCI and coking coal. The company hopes to boost production to more than the currently permitted 900,000-tonne level by mid-2005.