By Esmarie Iannucci

March 8, 2021 - Coal developer Allegiance Coal has raised A$10-million through a share placement to sophisticated and professional investors, fully funding its New Elk coal mine, in Colorado, through to development.

The ASX-listed company told shareholders that the placement, which was priced at 8c a share, had been driven by significant European institutional demand, including from Deutsche Balaton AG.

The latest placement was an extension of the A$15-million capital raise completed in February this year, and would be subject to shareholder approval at the company’s general meeting, scheduled for April.

“We are delighted to have received such strong European institutional investor interest and welcome our new investors to the register,” said Allegiance chairperson and MD Mark Gray.

“Although we have advanced the $15-million debt facility, the placement allows us to restart the New Elk mine without the need for this additional leverage.”

Allegiance at the end of December unveiled the startup mine plan for the New Elk project, which would see the company mine 22.2-million tonnes of saleable coal reserves over a 24-year mine life.

The project would require a startup capital investment of $17.7-million, with total all-in operating costs estimated at $81.3/t, Allegiance said at the end of December.

Allegiance said on Monday that production at New Elk was now expected to start in the June quarter of this year.