17 February 2023
OPERATIONS UPDATE
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Allegiance Coal Limited (Allegiance or the Company) is pleased to provide a general operational update to
the market.
Sales, Marketing and Logistics
“The Company has made the decision to pivot back to metallurgical coal production at both its operating mines.
This is in response to the dramatic fall in thermal coal prices for coal delivered to Europe, and the significant recovery in metallurgical coal prices over the last two months.
The Platts coking coal indexes for premium hard coking coals (both east coast Australia and east coast USA) have increased to over US$300/ tonne over the last two months.
The Company has, and continues to, work extremely well with a number of parties to market and initiate its first metallurgical coal sale for 2023.
Unfortunately the Company was not successful in the first tender we participated in for metallurgical coal at a steel mill in Europe referred to in the December 2022 quarterly
activities report.
We will most likely participate in the next tender that the same mill issues as our coal quality has passed their acceptance at Technical Committee level in their process, but in parallel we are marketing to other customers in Europe and Asia.
The last thermal coal train from the New Elk Mine is planned to be loaded next Saturday at the Jansen rail loading facility near Trinidad, Colorado to complete a previous thermal coal sale, after which the mine will adjust the coal preparation plant settings to start producing the lower ash metallurgical coal product.
At Black Warrior, the North Pratt coal preparation plant (operated by Black Warrior personnel) has already started producing the lower ash hard metallurgical coal specification, and four barges are already loaded and are floating down the Warrior River to the Port of Mobile.
The coal in these barges will form the start of the build of a metallurgical coal stockpile at the port ready for loading in a ship between late March or mid-April depending on the cargo size.”
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