UK-based coal miner Hargreaves Services has acquired assets of Scottish Coal (SCCL) in a transaction valued at £8.4m from SCCL's liquidators KPMG.
The project portfolio comprised 30,000a along with unencumbered plant, equipment, rights and interests in wind farm projects that are at various stages of development.
As per the arrangement, the acquisition is categorized in three stages with first stage involving acquisition portfolio, second includes the transfer of Scottish Coal’s interests in five mining sites, including Broken Cross and House of Water.
In third stage the company will acquire group of companies (Hivencos) that own the proposed coal asset and they will continue to hold the ownership. The third phase is scheduled for completion in next 12 months.
Although Hargreaves will not currently own the projects, the company is gearing up to invest between £12m and £15m of capital to recommence the projects, intending to produce about 1 million tons during the current financial year.
Commenting on the developments, Hargreaves CEO Gordon Banham stated that the arrangement marks a significant step in company’s strategy to acquire key surface mining assets to improve stakeholder value.
"The portfolio of property interests being acquired provides a strong platform to continue our investment in the Scottish coal industry which, responsibly managed, will benefit local communities with continuing employment and enable our continued support of the SMRT in addressing the legacy of unfulfilled restoration obligations," added Banham.
Hargreaves is also looking to operate other mining projects expecting that acquisition of additional assets from SCCL will provide the company with extra reserves. The company further estimates that the coal reserves at the Hiveco sites are in the excess of 3 million tons citing diligence on coal reserves, planning status, coal quality and overburden ratios.