American Power Corp. (OTC.BB:TGMP) will proceed to kick start the development of its advanced Pace Coal Project in Judith Basin County, Montana.
In April 2010, American Power Corp. acquired roughly 29,000 acres, which make up the Pace Coal Project. In 1979 Mobil Oil Co. (now ExxonMobil) drilled 30 holes over 14,000 of the project’s acreage, and delivered 45 samples which were later sent to an independent laboratory for analysis. It was subsequently determined that both the quality and the quantity of coal on the Pace acreage was high and significant, respectively. Several independent reports were commissioned based on the development work undertaken by Mobil Oil, determining there could be in excess of 410 million tons of high volatility bituminous coal potential on the Pace acreage.
Montana’s demonstrated reserve base of 119.1 billion short tons of coal represents over 24% of America’s total demonstrated coal reserve base of 487.7 billion short tons. Of particular importance, the coal at the Pace Coal Project is bituminous B coal, which, due to its higher BTU rating, secures a higher market price than most of Montana’s coal (typically sub-bituminous or lignite).
American Power Corp. is a publicly traded, dynamic energy company based in Denver, Colorado. The Company was established with the focus of acquiring near-term, large scale coal projects in close proximity to national transportation links. American Power envisions developing its large coal resources to support electricity generation.
International Coal Group (NYSE:ICO) is a leading producer of coal in Northern and Central Appalachia and the Illinois Basin. ICO has 13 active mining complexes, of which 12 are located in Northern and Central Appalachia and one in Central Illinois. ICO controls one billion tons of high-quality coal reserves that are primarily high-BTU, low-sulfur steam and metallurgical quality coal. ICO’s mining operations and reserves are strategically located to serve utility, metallurgical and industrial customers throughout the Eastern United States.
ICO is a leading producer of coal with a broad range of mid-to-high Btu, low-to-medium sulfur steam and metallurgical coal. ICO also has a complementary mining complex of mid-to-high sulfur steam coal strategically located in the Illinois Basin. ICO currently owns and operates 13 active mining complexes, 12 of which are dispersed within Central Appalachia and Northern Appalachia, with the one complex in the Illinois Basin.
ICO markets coal to a diverse customer base of largely investment grade electric utilities, as well as domestic industrial and steel customers. Coupling their primarily high-BTU, low-sulfur steam and metallurgical quality coal with the availability of multiple transportation options throughout the Appalachian region, ICO participates in both the domestic and international coal markets.
National Coal Corp. (Nasdaq: NCOC), a Central and Southern Appalachian coal producer, reports that for the three months ended June 30, 2010, it achieved total revenues from continuing operations of $10.6 million based primarily on the sale of 117,017 tons of coal. In the same prior-year period, National Coal generated revenues from continuing operations of $22.6 million based primarily on the sale of 290,508 tons of coal. The decrease in revenue from coal sales for the three months ended June 30, 2010, as compared to the same period in 2009, was primarily due to the assignment of a coal supply agreement to Ranger Energy Investments, LLC on April 20, 2010 as part of the Company’s sale of certain assets and real property.
For the three month period ended June 30, 2010, National Coal had an Adjusted Earnings Before Interest, Taxes, and Depreciation and Amortization (�Adjusted EBITDA�) of $3.4 million, compared to an Adjusted EBITDA of $1.2 million for the second quarter of 2009. For the three months ended June 30, 2010, National Coal reported income from continuing operations of $248,967 or $0.03 per share compared to a net loss of $6.3 million or $0.75 per share for the three months ended June 30, 2009.
The Company has engaged the services of a financial advisory firm to evaluate possible strategic and financing transactions. Among these alternatives, the Company has been pursuing a restructuring of its debt, the issuance of common stock in exchange for the purchase and cancellation of its debt, transactions in which the Company would issue preferred or additional common stock for cash, and merger transactions with other coal producers.
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