Morien Provides Update on Donkin Coal Mine
Morien Provides Update on Donkin Coal Mine
June 26, 201 7 – Halifax, Nova Scotia – Morien Resources Corp. ("Morien" or the
"Company") ( TSXV:MOX), is pleased to provide an update on production and development
activities at the Donkin Coal Mine (“Donkin”) in Cape Breton, Nova Scotia.
Owner/operator Kameron Collieries ULC (“Kameron”), a n affiliate of the Cline Group LLC,
recently provided Morien executives with a site tour of the mining operation. A series of recent
photos of the operation can be viewed on Morien’s website by clicking here, and an update on
Donkin is provided below. Morien has a gross production royalty of 2% to 4% on all coal sales
from Donkin.
Donkin Coal Mine Highlights
Current production is from a single continuous miner unit, with the addition of a second
continuous miner unit expected before the end of Q3 2017;
It is anticipated that four continuous miner units will be operational in 2018;
Kameron is anticipating production of approximately 350,000 to 450,000 tonnes in 2017,
1.2 to 1.8 million tonnes in 2018 , and 2.6 to 2.75 million tonnes of salable coal in 2019
(production volumes are subject to change based on numerous market and non -market
factors);
A coal handling, preparation and processing plant (“washplant”) is nearly complete, and
is expected to become operational before the end of Q3 2017;
The washplant has been designed to process 500 tonnes per hour (“tph”) , enough to
process the permitted production at Donkin;
Current coal production is being trucked and stockpi led at the Provincial Energy
Ventures port in Sydney, Cape Breton;
A total of 64 full-time employees/contractors are currently working onsite at Donkin, and
Kameron is forecasting a total of 135 full-time workers onsite at full production;
The Donkin Coal Technical Report, dated November 2012, found on Morien’s SEDAR
profile, supports the above technical disclosures.
Morien Royalty and Milestone Payments
On February 27, 2015, Morien sold its 25% working interest in Donkin to Kameron for
aggregate cash consideration of $5.5 million and a gross production royalty.
Morien owns a gross production royalty of 2% on the first 500,000 tonnes of coal sales per
calendar quarter (excluding the initial 10,000 tonnes of coal produced and sold from Donkin) and
4% on any coal sales from quarterly tonnage above 500,000 tonnes (“Royalty”). The Royalty is
payable to Morien on a quarterly basis over the anticipated 30 plus year mine life.
Using a range of coal pricing, annual royalty payments could be in the order of $4.0 million to
$8.0 million at full production. These values are only estimates based on Q2 2017 assumptions
that Morien management consider to be reasonable . Actual results and royalties received, if any,
and subject primarily to production rates and coal pricing, may vary from those estimated by
Morien.
Morien received a $2 million milestone payment on closing of the transaction with Kameron
(February 27, 201 5) and received a second milestone payment of $2 million on the second
anniversary of the closing (February 27, 20 17; click here for Morien news release). Morien is
entitled to receive an additional $1.5 million milestone payment on the earlier of first
commercial sale of export coal from Donkin and the third anniversary of the closing of the
transaction (February 27, 2018).
Qualified Person
Dawson Brisco, P.Geo. (Nova Scotia), Vice President Corporate Development, is a Qualified
Person as that term is defined in National Instrument 43 -101 and has reviewed and approved the
scientific and technical information contained in this news release.
About Morien
Morien is a Canadian mining exploration and development company, focused on unique mineral
industry opportunities in North America with two long-life royalty assets and a strong cash
position. Morien has 52,736,614 issued and outstanding common shares and a fully diluted
position of 57,911,614. Further information is available at www.MorienRes.com.
Forward-Looking Statements
Some of the statements in this news release may constitute "forward -looking information" as
defined under applicable securities laws. These statements reflect Morien's current expectations
of future revenues and business prospects and opportunities and are based on information
currently available to Morien. Morien cautions that actual performa nce will be affected by a
number of factors, many of which are beyond its control, and that future events and results may
vary substantially from what Morien currently foresees. Factors that could cause actual results to
differ materially from those in fo rward-looking statements include risks and uncertainties
described in Morien’s annual information form filed with the Canadian Securities regulators on
SEDAR (www.sedar.com). Morien cautions that its royalty revenue will be based on production
by third party property owners and operators who will be responsible for determining the manner
and timing for the properties forming part of Morien’s royalty portfolio. These third party
owners and operators are also subject t o risk factors that could cause actual results to differ
materially from those predicted herein including: volatility in financial markets or general
economic conditions; capital requirements and the need for additional financing; fluctuations in
the rates of exchange for the currencies of Canada and the United States; prices for commodities
including gold, coal and aggregate; unanticipated changes in production, mineral reserves and
mineral resources, metallurgical recoveries and/or exploration results; changes in regulations and
unpredictable political or economic developments; loss of key personnel; labour disputes; and
ineffective title to mineral claims or property. There are other business risks and hazards
associated with mineral exploration, develop ment and mining. Although Morien believes that
the forward-looking information contained herein is based on reasonable assumptions, readers
cannot be assured that actual results will be consistent with such statements. Morien expressly
disclaims any intention or obligation to update or revise any forward -looking information in this
news release, whether as a result of new information, events or otherwise, except in accordance
with applicable securities laws. All dollar values discussed herein are in Canadian dollars.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is
defined in the policies of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
For more information, please contact:
John P.A. Budreski, President and CEO
Phone: (416) 930-0914
or
Dawson Brisco, P.Geo, VP Corporate Development
Phone: (902) 466-7255
www.MorienRes.com