The company said that the lease, located in Knox County, contains the profitable Blue Gem coal throughout, at an average seam thickness of two feet.
NAG expects the mining costs for the highwall/surface Granny Rose operation to be relatively low due to mining conditions and favorable strip conditions.
The producer acquired the lease in early February. At that time, officials said the mining permit – then in process – outlined about 250 acres to be mined using surface methods and approximately 100 acres using highwall and/or auger techniques to extract.
Blue Gem seam coal is especially attractive to NAG, which will globally market the specialty coal typically used in silicon metal production.
In total, the producer holds about 5000 acres of coal reserve leases in Knox and Whitley counties in Kentucky, and is actively developing eight for permits.
Based in Vancouver, North American Gem has a coal focus in Saskatchewan, Kentucky and West Virginia.
Check out an overview of NAG’s No. 1 and No. 2 operations in the March 2010 issue of Coal USA, out now.