core sector communique

GUJARAT NRE COKING COAL FINALISE THE ACQUISITION OF MINING LANDS ASSOCIATED WITH NRE NO.1 COLLIERY AND SETTLEMENT OF ALL RELATED LITIGATION

Gujarat NRE Coking Coal Limited (ASX Code: GNM, or the Company) is pleased to announce that it has concluded the acquisition of the mining lands associated with NRE No.1 Colliery which has included the settlement of litigations with various parties related to the acquisition of the mining lease and the associated land.

The Company has paid out around $45 million (plus GST) which has involved: 

1. the acquisition of the associated mining lands with NRE No.1Colliery approximately being 93 hectares;
2. termination of any royalty payment liability to the Company under the agreement with Bellpac for acquisition of the mining lease;
3. termination of remediation obligations inter alia with Bellpac; and 

4. the settlement of the following litigation matters, which removes all potential uncertainties and possible obstacles with access to the mine and the proposed development plans:

• Gujarat NRE Coking Coal Limited vs Bellpac Pty Limited
• Gujarat NRE Coking Coal Limited vs LM Investment Management Limited, Bellpac Pty Limited and Permanent Trustee Australia Limited
• Gujarat NRE Coking Coal Limited & Gujarat NRE Coke Limited vs Gary Alexander Williams & Others

The acquisition of the mining land and settlement of litigation are major achievements by the Company as it is now able to ensure the smooth and continuous operations at NRE No.1 Colliery for the life of the mine.

The Company is in process of setting up longwall mining operations at NRE No.1 mine and to ramp-up its production to 3 million tonnes per annum from this mine and 6 million tonnes per annum in total from both the mines (NRE No.1 and NRE Wongawilli). The mining land acquired was crucial not only for current operations but also for the proposed future development as the Company would require this land for operational logistics including coal handling and stockpiling. Ownership of these adjoining areas ensures that the Company would not require approval or negotiation of access agreements with the various land owners for the proposed use.

Commenting on the deal, Mr. Arun Kumar Jagatramka, Chairman of Gujarat NRE Coking Coal Limited said “The acquisition of the adjoining lands associated with the NRE No.1 Colliery not only brings a valuable asset into the books but also overcomes any potential obstacle as the Company continues to ramp up to introduce longwall operations at NRE No.1 during the current year, and progressing to reaching the ultimate goal of achieving a production target of 3 mtpa from this mine and 6 mpta as a Company.”