dcffdbac-f1b4-41a7-b64d-f58e3fc62c27.pdf
NEWS RELEASE | 29 JANUARY 2016
DECEMBER 2015 QUARTERLY REPORT
Prairie Mining Limited is pleased to present its quarterly report for the period ending 31 December 2015. Highlights during, and subsequent to, the quarter include:
HIGHLIGHTS:
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Strong Financial Position - Cash reserves and listed securities in excess of $17.5 million placing the Company in a strong postion to rapidly progress its planned development activities;
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Increased Liquidity due to European Listings - Following successful listings in London and Warsaw, Prairie has enjoyed high volumes and good liquidity on the Warsaw Stock Exchange highlighting strong local market support;
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Pre-Feasibility Study - Work continued on the PFS for the Lublin Coal Project with the study expected to be completed and released to the market during the current quarter;
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Shaft Sinking and Equipping - Substantial progress of shaft sinking study for inclusion in the upcoming PFS;
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Railway Spur Line Studies - The study is advancing and is currently being reviewed for inclusion in the upcomong PFS;
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Bulk Power Supply - Stage two study for the 110 kV power supply to operations is being finalised prior to inclusion in the upcoming PFS; and
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Environmental and Social Impact Assessment - Continued baseline studies for the ESIA, the completion of which is a pre-requisite for the grant of a mining concession at the LCP.
GOING FORWARD:
The Company has an exciting quarter ahead with a substantial amount of activity scheduled including the following:
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Complete the PFS for the world class, high margin Lublin Coal Project;
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Following release of the PFS, conduct a number of comprehensive marketing activities that leverage off the successful listings on WSE and LSE and the strong local market support. This will include targeted investor presentations, Polish focused roadshows and Project site visits;
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Continuation of Environmental Baseline Studies as part of the ongoing ESIA;
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Progression of work on the Deposit Development Plan which forms a key part of the Polish requirement for a mining concession application; and
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Continue the successful project permitting program including site selection, land acquisition and applications for re-zoning.
London Office Warsaw Office Registered Office
Unit 1C, 38 Jermyn Street | London | SWY1 6DN Ul. Wspólna 35 lok. 4 | Warsaw | 00-519
Level 9, BGC Centre, 28 Esplanade | Perth | WA | 6000
Email: Website: ABN:
ASX/LSE/WSE:
[email protected] www.pdz.com.au 23 008 677 852 PDZ
Figure 1: LCP Target Export Locations
For further information contact:
Ben Stoikovich
Chief Executive Officer
+44 207 478 3900
[email protected]
LUBLIN COAL PROJECT
The Lublin Coal Project ("LCP" or "Project") is a large scale premium coal project located in the Lublin Coal Basin in south east Poland. The Lublin Coal Basin is an established coal producing province which is well serviced by modern and highly efficient infrastructure, offering the potential for low capital intensity mine development. The LCP is situated adjacent to the Bogdanka coal mine which has been in commercial production since 1982 and is the lowest cost hard coal producer in Europe.
Figure 2: LCP Exploration Concessions
Pre-Feasibility Study
During the quarter the Company progressed with the Pre-Feasibility Study ("PFS"). A joint team of consultants from Golder Associates (UK) Ltd ("Golder") and Royal HaskoningDHV ("RHDHV") are managing the PFS which has been designed to comply with international best practise in all study areas in order to support detailed technical and financial due diligence by strategic equity partners, offtakers, financial institutions and to promote a seamless transition to the Definitive Feasibility Study ("DFS").
During the quarter the Company progressed with the following work streams:
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Completed preliminary layout for the CHPP and waste and product handling facilities;
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Conducted review of Polish coal industry salaries with findings to be incorporated into the PFS financial model;
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Finalised organisational structure and manning levels that comply with Polish statutory requirements and meet commercial operational requirements;
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Reviewed costings for transport corridor link between mine site and main rail line;
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Stage one and stage two report of 110kV power supply option advanced with multi attribute decision analysis carried out to determine best option(s) - Stage two being finalised on best options basis and currently being reviewed prior to incorporation into upcoming publication of the PFS;
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Draft shaft sinking and hoist designs ongoing with a review underway prior to incorporating into the PFS;
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Geotechnical parameters for roof support system and optimised longwall panel layouts conducted;
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Deposit Development Plan 50% completed; and
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Collated and updated capital and operational cost data from Polish suppliers.
Going forward, Prairie's PFS team will now focus on the completion of the PFS during early 2016 including the following study requirements:
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Mine development and production scheduling;
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Subsidence predictions;
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Ventilation design;
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Finalisation of all surface engineering and transport systems;
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Finalising CHPP design;
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Finalising waste management;
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Input estimates of capital and operating costs into financial model; and
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Study reporting.
Environmental & Social Impact Assessment
Prairie recently completed a number of major work program items in relation to its ongoing Environmental & Social Impact Assessment ("ESIA") for the LCP. The ESIA, being conducted by Multiconsult (formerly WS Atkins), is an extensive study that includes a wide range of environmental monitoring programs, field surveys, ecosystem sensitivity assessments, socio-economic surveys and a detailed community study and stakeholder engagement plan. The scope of the ESIA has been defined to meet Polish, European Union and international standards, including compliance with the Equator Principles to support the future financing of the Project.
Prior to the commencement of environmental baseline field work studies for the LCP, Prairie's ESIA study team completed a desktop review of the available environmental and social data for its concession areas. Given the fact that there is an existing mining operation adjacent to Prairie's concessions, Prairie has benefited from the existence of significant baseline data for the region which represent actual mining conditions, including surface water flows and quality, information on groundwater and ground levels after subsidence, noise and waste characteristics.
Following completion of this desktop review, Multiconsult immediately commenced with the required baseline studies to obtain data that was not already available. The baseline studies are now underway for all concession areas at the LCP, and will continue for some time to capture seasonal differences. Field studies relating to nature inventory for concession areas were completed in October 2015 with detailed nature inventory reports currently being finalised. One-year surface water monitoring for the concession areas were also completed in October 2015 together with preparation of a specific surface water monitoring report. The company has commenced an initial hydrogeological study with approximately 1,500 existing shallow wells (located mainly in quaternary deposits) having been tested. On this basis, a map of the first ground water table contours has been created. The map will be included in the upcoming Deposit Development Plan.
The Company has also completed its internal Stakeholder Engagement Plan which is a key component of the ESIA process, and will ensure that the Company communicates effectively with all relevant stakeholders of the Project. In October 2015 the Company also commenced preliminary work on the Acquisition and Livelihood Restoration Framework in line with the International Finance Corporation Performance Standards. The Framework will further strengthen effective community engagement and assess impacts and opportunities for stakeholders through the life of the Project. Prairie is on track to complete all environmental baseline studies and submit its completed ESIA to the Polish authorities during 2016.
The submitted ESIA will provide the Polish authorities with sufficient information to award an Environmental Consent Decision, which is a pre-requisite for the granting of a mining concession over the Project's Mine Plan Area.
The new Regional Spatial Development Plan of Lublin, which was passed by the Lublin Regional Assembly in October 2015, established that a leading strategy in the Lublin region is the development of coal mine infrastructure. This resolution significantly facilitates and encourages the development of the LCP.