Paringa Resources (NASDAQ: PNRL) operates the low cost, high quality Poplar Grove Mine, part of the Buck Creek Complex located in the Illinois Coal Basin in western Kentucky. In the latest update of its underground coal mining operation, Paringa announced significant increases in productivity rates from its first production unit. Processing and surface operations are functioning well, and plant yield is increasing as out of seam dilution decreases.
Why It Matters: “Western Kentucky is one of the world's best mining jurisdictions due to its access to low cost power, utilities, transportation and non-union labor pool. Mining conditions at Poplar Grove are similar to those encountered in neighboring mines, which rank as some of the most productive room-and-pillar operations in the world. Paringa’s Buck Creek Complex includes two fully permitted thermal coal mines: (1) the operating Poplar Grove Mine with production capacity ramping up to 2.8 Mtpa; and (2) the permitted Cypress Mine with planned production capacity of 3.8 Mtpa. Construction of the Poplar Grove Mine has been completed and production ramp-up has begun, with full production capacity targeted in 2020. The Company also has plans to develop the Cypress Mine.
What’s Next: In the coming months, Paringa will seek approval from the Mine Safety and Health Administration for an extended cut plan, with the potential for cut depths to be significantly increased from the current 20 ft limit. This approval, coupled with split ventilation, will enable another major step-change in mining productivity. All other surrounding mines in the region have received MSHA extended cut approval, with customary approval limits of up to 40 ft.
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