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- New Age Exploration (NAE) will update the scoping study for Lochinvar coking coal project in the UK, amid an improving economic outlook for the project
- The company believes metallurgical coal prices will remain elevated and expects the regulatory environment for related projects to improve
- NAE has engaged independent technical consultants, Palaris Australia to update the initial scoping study
- The study will look to update marketing and the financial model, taking into account the changed economic environment
- Shares are trading 50 per cent higher at 0.9 cents at 1:59 pm AEST
New Age Exploration (NAE) shares jump as it prepares to update the scoping study for the Lochinvar coking coal project in the UK, amid an improving economic outlook for the project.
The company believes that import bans on Russian coal and a change in UK Government will improve the regulatory environment for metallurgical coal projects.
Additionally, it expects metallurgical coal prices to remain elevated for a number of years due to trade imbalances from the Russia Ukraine war and a lack of investment in new mine capacity in recent years.
NAE has engaged independent technical consultants, Palaris Australia to update the initial scoping study.
The study will look to update marketing and the financial model, taking into account the changed economic environment.
This includes reviewing coal price relativities, valuation date, discount rate, macroeconomic assumptions, operational expenditure, capital expenditure, production split, and coal price relative to the benchmarks.
The company previously reported a nil valuation for the project in its June 2021 Annual Report but expects to revisit the valuation in the next six to nine months.
Executive Director Joshua Wellisch said it has received expressions of interest in the Lochinvar project from a range of investors.
“NAE remains confident that new technologies that may replace metallurgical coal in the steel sector may not come online for many decades,” he said.
Shares were trading 50 per cent higher at 0.9 cents at 1:59 pm AEST.
