Bens Creek Group PLC, the owner of a metallurgical coal mine in North America, has confirmed plans to list on AIM with trading set to start next Tuesday.
The company’s site in West Virginia hosts 17.2mln tons of metallurgical coal, used to make steel, with a GBP7mln placing already completed to reboot the mine and get production started again.
Bens Creek raised the GBP7mln at 10p per share, which will give it a market value of GBP35mln when trading starts.
Met (coking) coal prices hit an all-time high in October due to short supplies and healthy demand as steelmakers upped production and built stocks to cope with the supply chain disruption currently.
Adam Wilson, Bens Creek chief executive, said in a statement today: “High-quality metallurgical coal is a scarce commodity with large scale mineable deposits limited to regions in the Eastern United States, Western Canada, Eastern Australia, Russia, China, Mozambique, and Mongolia.
“Importantly, it is also a critical input in the steel production process. This is one of the reasons why the price of metallurgical coal has historically been significantly higher than for that of thermal coal.
“Upon admission we expect the business to have low levels of debt combined with robust operating margins, and we expect to generate significant operating cash flows from our operations by utilising contract miners who will supply labour, equipment, and materials”