Regency Mines (LSE:RGM) provided an update on operations across its portfolio of assets and investments on Friday. The company reports improved coal production at Omega in Virginia, USA after moving a high wall miner to a new location at the end of 2018. The move should ensure a further three years of production with improved efficiency.
As Regency’s CEO Andrew Bell explained to MiningMaven in November, the move will ramp up production since the high wall miner has the capability to work two shifts, and the new location is closer to the customer, reducing transport costs.
There are currently two high wall miners in operation and Bell sees further improvements ahead, commenting`: ‘Once the second mining machine is moved to its new location we expect to see overall operations reaching a new level of turnover and profitability. Many other initiatives are under way to tune up performance and increase production, and we look to the future with confidence.
Following the replacement of a cutter head to the machine this week, the operation now targets a sales level of 2,200 to 2,300 tons per day from production and third-party sales. Regency also highlights cost reductions in wages due to the implementation of a new shift pattern saving $80,000 every two weeks.
Meanwhile, in Papua New Guinea, progress is being made at Regency’s 50% owned Mambare nickel and cobalt project. The project had come unstuck following the failure of a former Joint Venture partner, however, Bell states activity has resumed:
‘At Mambare, the hiatus that followed the failure of our former joint venture partner is now over and a new and committed partner has come forward out of the old structure, just in time for us to meet the challenges of recovering nickel and cobalt demand. The outlook for the Mambare joint venture is transformed by this and we and our partners are stepping up activity with some significant initiatives that we hope will lead to the grant of a mining lease and may lead to DSO production.’
The joint venture is continuing work by developing a direct shipping (DSO) plan and a pre-feasibility study is expected to be completed in the coming months.
Regency holds an 80% interested in Allied Energy Services Ltd (AES) via its 100% owned subsidiary Energy Storage Technologies Ltd (ESTEQ). AES is looking to develop a number of sites for private grid networks and combined heat and power provision.
The company has signed a pre-lease agreement over a 0.94 acre site in Knowsley capable of hosting a 49.5MW facility. A second fully permitted site 9MW site is in advanced negotiation. Further sites of 49.5MW and 4.5MW are also under negotiation.
Bell commented ‘At ESTEQ, AES and vanadium explorer DVY we are increasing our battery metal footprint and developing what may this year become a significant and cash flow-generative business at AES.’
Overall, great progress is being made and we thank shareholders for their support." Bell concluded.
Author: Stuart Langelaan
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