April 7, 2019 - American Resources Corporation (NASDAQ: AREC), a supplier of raw materials to the rapidly growing global infrastructure marketplace, with a primary focus on the extraction, processing, transportation and selling of metallurgical coal to the steel industry, announced today that it has delivered an additional continuous miner to its Mine #15, located in Pike County, Kentucky, to further expand the production of metallurgical coal. The currently operating Mine #15 is an underground mine located at the company's McCoy Elkhorn Coal complex and produces High Vol B metallurgical coal from the Glamorgan coal seam.
American Resources currently utilizes two continuous miners at two separate operating sections within Mine #15. Due to the high demand for the metallurgical coal produced by this mine, and as part of its expansion plan, the company recently acquired one additional continuous miner and has another in the rebuild process to enhance the mine's production. This additional Joy 14CM15 model continuous miner that was acquired will be the third operating miner at Mine #15 and is expected to have proximity detection safety technology installed and producing within six weeks. This third continuous miner will be used to convert one of Mine #15's single-sections to a modified super section and then shortly thereafter to a full super section whereby, increasing the mine's total output by 6,000 (modified super section) and ultimately 12,000 tons per month (full super section).
The company is rebuilding its fourth continuous miner that will bring both operating sections to full super sections at Mine #15 later this spring once it has been rebuilt and fully rehabilitated. By mid-summer, with four operating miners on two super sections, Mine #15 is expected to produce 36,000 to 44,000 clean tons per month with an annual run rate revenue at such time of $40 million to $50 million.
The Company is also evaluating the potential to add a third operating section to Mine #15 by the end of this year, which could represent a substantial increase in production beyond the current forecasts.
''This is yet another stepping-stone in our growth plans'', stated Thomas Sauve, President of American Resources Corporation. ''Having the ability to not only bring new mines online cost effectively, but to also increase the efficiency and output of our currently producing mines is core to our growth strategy under our low-cost operating model. We're excited to see our continued progress throughout the rest of the year and beyond.''
As in the past, all production from Mine #15 is belted directly into one of the company's two on-site coal processing facilities at McCoy Elkhorn Coal and loaded onto rail. Additionally, the enhanced production will give American Resources the ability to blend the coal with other metallurgical production at McCoy Elkhorn to offer its customers a very attractive High Vol metallurgical coal product. As a result of the increased tonnage, the fixed operating costs at the McCoy Elkhorn processing and load out complex will further be reduced on a per ton basis, providing further margin expansion.
American Resources Corporation continues to focus on its growth objective by efficiently leveraging its large number of core mining permits and through identifying strategic, supplemental acquisitions and continuing to consolidate quality coal assets for future growth and production. The company is committed to being one of the lowest cost operators in CAPP and throughout all its coal mining, processing, and transportation operations.