Royal Coal Expands Operations, Gets New Sales Contracts for 2012

Toronto-based junior miner Royal Coal Corp. on Wednesday announced it had secured a 234,000-tonne worth coal sales contracts for delivery starting January 2012.

The company said the coal will be sourced from its Appalachian mines at an average sales price of $85 a tonne.

"These contracts are very attractive and give the company a solid foundation of sales for the upcoming year. The company is pursuing increased production from its own operations and permits as well as the potential of additional production through the acquisition of new assets," said Tom Griffis, chairman of Royal Coal.

The Appalachian producer of high BTU, low sulphur thermal coal also said it anticipates new term contacts to be signed over the coming weeks for additional sales in 2012.

Apart from the Appalachian mine sale, Royal Coal said it had negotiated arrangements with Novadx Ventures Corp. and the Ikerd Group of Companies to mine and sell coal from its Flatwoods, Kentucky  mine on a contract basis.

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Novadx will get 15 million Royal Coal shares and $2.50 per tonne of coal mined up to $2.5 million, while Ikerd and some of its creditors will be paid $2.75 per tonne of coal mined on the leases.

Royal Coal has open pit coal mines in the central Appalachian coal producing region of the United States, including parts of West Virginia, Virginia, Kentucky, Ohio and Tennessee.

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