Toronto-listed Grande Cache was formed in 2000 to reactivate coal mining in the Grande Cache area, Canada. The company’s opencut and underground mines produce low volatile, metallurgical coking coal for export.
The Canadian company recorded a loss of $C10.5 million in the September quarter, and a $C22.6 million loss for the first half of the year.
Despite the loss, sales levels did improve in the second quarter, with a total of 400,000t sold at an average price of $C90/t, resulting in $C35 million revenue for the period.
October proved to be a highlight month for Grande Cache’s underground mine, which reported its highest production numbers ever. Depillaring, the company said, will add to the continually improving record underground.
The room and pillar No. 7 mine commenced production in late 2004.
Grande Cache has also said it expects its unit costs to increase due to increased production and availability.
Some shipment delays and uncertainties, particularly with its Asian customers, have kept the company from being able to determine official figures, though it estimates its cost of sales at $C105/t over the remainder of its fiscal year and revenue of approximately $C123/t.
Grand Cache said the delays will likely result in the carryover product to be delivered into the 2007 fiscal year.
The company has responded by attempting to diversify its customer base as well as make its production and market commitments parallel.
“We are encouraged by the progress we have made in improving our mining operations through September and October,” Grande Cache president Robert Stan said.
“We are in discussions with our Asian customers concerning shipping schedules for the balance of this fiscal year.
“Our market diversification efforts are showing positive signs and we are encouraged about the future prospects. With the improvements in our production, Grande Cache is able to produce 2Mt in our next fiscal year,” Stan said.
While he noted the company was currently working on securing contracts for that production, he anticipated a lower cost of sales in the coming fiscal year at $C80/t.