Capital boost will lead the way to first production for TIG’s Pacific Russia development – 7 July 2016

Home / Views / Capital boost will lead the way to first production for TIG’s Pacific Russia development – 7 July 2016

The announcement of a A$23.3 million capital raising by Tigers Realm Coal to accelerate development of its extensive coal deposits in Far Eastern Russia is exciting news.

The raising is a 1:1 rights issue open to all shareholders and is effectively underwritten by three of TIG’s biggest shareholders who will take up any shortfall. This means we can push on with a high degree of confidence.

The bulk of the funds raised will be directed toward developing Phase 1 of Project F, an extensive coking coal deposit only 35km from the port of Beringovsky. This is a competitive low capex, low opex deposit which can be brought into operation pretty quickly.

We are looking at building it over time to a one million tonnes a year operation which can provide a healthy cash flow while we continue to work on and develop the even more extensive deposits at Ammam North and Ammam. Coal Resources at these two deposits currently total 632 MT, and large areas are still underexplored.

TIG owns 100% of the Beringovsky Port and Coal Terminal. The port is presently fully operational and has historically handled over 700,000 tonnes of coal per year. Our goal is to progressively refurbish and expand it to at least 1MTPA capacity.

The underwriting of the rights issue by three of TIG’s bigger shareholders – BV Mining Holding Ltd, Hanate Pty Lt and RDIF Investment Management (the latter subject to FIRB approval) – reinforces our positive outlook for coking coal. That TIG’s deposits are so close to the great steel markets of China, South Korea and Japan adds to our confidence.

The year ahead looks very positive for TIG.