Pacific Coal tightens its belt

COLOMBIA-focused producer Pacific Coal Resources posted a $US49.5 million net loss for the 2012 second quarter compared to an $8.8 million loss registered in the same period last year.
Pacific Coal tightens its belt Pacific Coal tightens its belt Pacific Coal tightens its belt Pacific Coal tightens its belt Pacific Coal tightens its belt

Map of Pacific Coal's properties in Colombia.

Justin Niessner

The Toronto-based miner counted 335 million tonnes of coal produced during the quarter, representing a 9% drop versus Q2 2011.

Coal sales sank 10% over the same period.

The downward trend in coal market prices was noted as the principal trigger of the disappointing numbers but Pacific chief executive Luis Carvajales was upbeat about advances made at the company’s Colombian coal operations.

“Important progress continues with the development work at La Caypa’s south pit, Cerro Largo’s integrated mine plan and the CI Jam project,” he said.

“We have also implemented a comprehensive cost reduction plan, given actual thermal coal and [metallurgical coke] market trends, that will reduce our [general and administrative] expenses by 35 per cent or approximately $6 million annually.”

Pacific’s flagship La Caypa open pit produced 267,000 tonnes in the quarter, showing a 45% increase versus the first quarter of 2012.

Cerro Largo mined 68,000t of coal over the same period but reflected a 50% loss compared to its record production in Q1.

La Caypa has a coal resource of 17.8Mt (indicated) while Cerro Largo claims a resource of 11.6-21.2Mt of coal (inferred).

Exploration at both sites was completed during Q2 2012.

The CI Jam coking coal underground managed 7,000t on the quarter, down from 11,000t in Q1 2012 due to a production suspension based on lagging metcoke markets.

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