The deal, which is being carried out through the company’s wholly owned Corsa Coal Pennsylvania division, includes the mining rights to a 105-acre property. While the resources are known to be metallurgical, Corsa said the scope and size of the reserve base had not yet been determined.
Under the option agreement’s terms, Corsa will make an initial $US25,000 payment to Sherpa to acquire the property, which will give the potential operator the right to fund both an exploration program and the permitting process that would be required with any development.
Corsa has been granted the right and option to acquire a 100% interest in Miller-Walker by paying Sherpa $1.5 million before the last day of 2011 via a one-time transfer.
Sherpa outlined, however, that Corsa must incur $50,000 in exploration expenses as it performs engineering studies, files permit applications and secures other development-related items during 2010. If Corsa chooses not to acquire the full interest in Miller-Walker or terminates the transaction, Sherpa will repay Corsa through future mining income from the property at $2 per tonne of raw coal extracted.
“The [Corsa] board … considers the acquisition of the option on the Miller-Walker property a first step in the execution of its metallurgical coal strategy,” Corsa said, noting that its reformation in mid-2009 included organic growth through reserve development and coal asset acquisitions.
The company said its staff, experienced in Appalachian coalfield development and mining, were working on due diligence, evaluations and discussions for several projects, though it did not give any details.
An ILN request for comment and further details was not immediately returned.
Corsa signed a deal in 2008 with Kaminak Gold Corporation to explore the company’s Sy gold project in Nunavut, Canada. The company said Monday, however, that it would not exercise its option with Kaminak because the property “does not fit within the parameters of the company's metallurgical coal strategy”