WCC cashes up on heels of Wolverine approval

Vancouver — One day after receiving environmental approval for its Wolverine metallurgical coal project in northeastern British Columbia, Western Canadian Coal (WTN-V) announced a private placement worth $100 million. The financing, led by Sprott Securities, is scheduled to close Feb. 9.

London-based Cambrian Mining, which already owns 48% of WCC’s shares, agreed to subscribe for $20 million worth of the offering, which would increase its stake to 42%.

WCC’s chairman, John Byrne is also the CEO of Cambrian.

WCC intends to use the proceeds for environmental and regulatory permitting of the Brule mine, part of the Burnt River property, and on construction and development at Wolverine.

“It’s exciting for us, and for northeastern B.C., where economic development has been in a depression over the past decade,” says William Burton, vice-president of operations for WCC.

The provincial government has expressed satisfaction with the technical, environmental and socio-economic aspects of the proposed project, which comprises the Perry Creek and EB open-pit deposits. WCC will be permitted to produce 1.6 million tonnes of clean metallurgical coal per year at Perry Creek and EB over 11 years.

The Wolverine project is 25 km from the town of Tumbler Ridge.

Starting in the second quarter, the company intends to build a 2.4-million-tonne-per-year hard coking coal preparation plant and rail load-out adjacent to the Perry Creek pit. The facility would subsequently be expanded to 3 million tonnes a year to accommodate coal from the nearby resource at EB, Hermann and Perry Creek.

The initial plant and facilities at Wolverine are estimated to cost $180 million.

Mining at Perry Creek would likely begin in the first quarter of 2007.