MMEX clears hurdle in Colombian development plans

COLOMBIA and Peru-focused explorer MMEX has taken a significant step towards its plans in the former country following the receipt of a comprehensive study on coal project transportation and infrastructure from a third-party firm.
MMEX clears hurdle in Colombian development plans MMEX clears hurdle in Colombian development plans MMEX clears hurdle in Colombian development plans MMEX clears hurdle in Colombian development plans MMEX clears hurdle in Colombian development plans

Courtesy MMEX Mining

Donna Schmidt

“Upon entry into Colombia in 2010 [we] recognized that access to export markets depends upon challenging infrastructure and transportation systems since all coal transported today from the interior metallurgical producing areas is dependent upon trucking,” the company said.

The consultant, which MMEX did not identify but confirmed as having significant experience in the Andean nation, reported the capability for significant production volumes to be transported at reasonable costs.

Specifically, the study presented the current projected transport model costs to the Caribbean and Atlantic ports of Barranquilla as well as the Pacific port of Puerto Buenaventura.

Trucking only, the consultant said, would cost between $US51 and $57 per ton, while intermodal trucks and river barge costs ranged between $53 and $57/t.

Third, it said costs for intermodal truck and train, when completed, would be between $39 and $41/t.

The study also found that with a relatively low capital cost for the construction of a bypass road, production levels of up to 2.4 million tons per annum could be transported – that is the maximum capacity of MMEX’s current existing permits

“This study is a major milestone to our development plans in Colombia and significantly improves the economics of our coal projects confirming that we have the potential to produce and transport much higher volumes of met coal with lower transportation costs and capital expenditures for road infrastructure,” president and chief executive officer Jack Hanks said.

“This underscores our strategy to attract and invest more capital to develop much higher levels of production and become a major met coal producer in Colombia.”

MMEX is continuing to look at potential projects in Colombia for metallurgical coal.

The Texas-based explorer is publicly traded on the OTC market under the ticker symbol MMEX.

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