Jogmec to explore for Canadian coking coal

OREANDA-NEWS. Japan's state-owned energy agency Jogmec has agreed with Canadian mining company Altitude Resources to jointly explore coking coal at the Palisades project in western Alberta.

The agreement will give Jogmec the right to earn 31.875pc of the Palisades project by paying C\$3mn (\$2.4mn) in exploration expenditure over two years. Jogmec can pay an additional C\$1.8mn in the following 12 months to earn an additional 19.125pc share, which would take its total to 51pc. The agency can also transfer its stakes to a Japanese company during the term of the agreement.

Palisades, around 350km northwest of Calgary, consists of seven coal leases covering 117km?. It is located near the Cheviot mine operated by Teck Coal and Summit project developed by Maxim Power, which is considered highly prospective for coking coal.

This is the first joint coal exploration project for Jogmec in North America, after three such projects in Australia. Japan depends on Australia for around 50pc of its total coking coal imports. Indonesian supplies account for around 30pc, although much of this is considered by market participants to be low-ash thermal coal that is used by steelmakers at their captive power plants.