LakeCoal owns 80% of the Wallarah Coal joint venture in which the Chain Valley mine is held.
The acquisition increases Excel’s ownership of Lakecoal to 100% and its ownership in Chain Valley from 72% to 80%.
The Chain Valley mine produces about 700,000 tonnes per annum of thermal coal for the domestic and export market via Newcastle Port.
During the 2005 December quarter, Chain Valley produced 179,000t, 54% more coal than the previous December quarter, largely due to the ramp-up of the second production unit.
To extend the mine life to 20 years, Excel is developing the Fassifern seam at Chain Valley with development of the second drift and ventilation shaft continuing.
Today’s acquisition adds to a raft of expansion activity for Excel, which recently received the green light for its $A116 million Wilpinjong Coal project. The opencut mine will be located near Wollar, northeast of Mudgee in NSW and is expected to produce 13 million ROM tonnes beginning January 2007.
Excel was trading at $A7.67 this morning.