Jameson Resources (ASX:JAL) has announced the results of an internal update on the Pre-Feasibility Study on the Crown Mountain coking coal project in British Columbia, Canada. Due to the collapsed USD/CAD exchange rate, Jameson was able to reduce the operating cost per tonne of coking coal.

Using an USD/CAD exchante rate of 1.25, the FOB operating cost during the first four year of the mining operation would be just $71/t, resulting in an impressive margin of just over $35/t based on the current coking coal price. The LOM FOB production cost will be approximately $88/t. As the initial capex could be reduced to just $123M when using contractors, the investment could be earned back within 2.5 years taking a 2 million tonnes per year operation into account.

Jameson Resources still has some boxes to tick before it can indeed commence construction of Crown Mountain next year, but the internally updated PFS definitely shows Crown Mountain is definitely worth to keep an eye on as it’s a low-cost coking coal project.

> Click here to go to Jameson’s website

Disclosure: The author holds no position in Jameson Resources. Please see our disclaimer for current positions.

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