However, the company said it has yet to perform the in-depth due diligence necessary before it makes a final decision on whether to exercise the option agreement. The process is likely to “take several months to complete,” the company said. Moreover, Atlantic said there is no guarantee the deal ultimately will be completed.
Earlier this year, Atlantic entered into a lease arrangement with Reading Anthracite Co. for an unspecified amount of reserves in Luzerne County. Atlantic believes the new reserves would allow it to make export sales to China. Currently, Atlantic owns only one mine in Pennsylvania—the Stockton surface mine in Schuylkill County. Coal Contractors Inc., an Atlantic subsidiary, operates the mine. In 2011, Stockton produced 100,139 tons of coal that were sold for an average price of $142.44/ton. The sales generated total revenue of $14.1 million for the company.
Steve Best, Atlantic’s managing director, said that while the company anticipated higher production from Stockton last year, it remains confident the recent acquisition of a Komatsu PC2000 hydraulic excavator, as a replacement for its previous DeMag H185 excavator, will enable Stockton to boost its output this year.