TAIYUAN, China, Nov. 15, 2010 /PRNewswire-Asia/ -- Puda Coal, Inc. (NYSE Amex: PUDA) ("Puda Coal" or the "Company"), a supplier of high grade metallurgical coking coal used to produce coke for steel manufacturing in China and a consolidator of twelve coal mines in Shanxi Province, today announced that Shanxi Puda Coal Group Co. Ltd ("Shanxi Coal"), a 90% subsidiary of Puda Coal, has received approval from the Shanxi provincial government for the comprehensive Coal Mines Geological Technical Report (the "Report") for Pinglu County Da Wa Coal Industry Ltd ("Da Wa Coal") submitted by Shanxi Coal Geology Company ("Shanxi Coal Geology Company"), an independent coal resource geological company.
Pursuant to Shanxi Province's coal mine consolidator program, consolidators are required to do exploration for the reserves of the assigned target coal mines and submit geological technical reports to Shanxi province's technical reviewer. The Report prepared by Shanxi Coal Geology Company lists detailed information regarding Da Wa Coal's geology, seams, characteristics, engineering, exploration, environmental and coal reserves. On November 3, 2010, the Report was approved by the reviewer of Shanxi provincial government after two round comments. The Company acquired the mining assets (including the physical assets and mining rights) of Da Wa Coal in May 2010. The purchased mining assets of Da Wa Coal have been placed into a new project company named Shanxi Pinglu Dajinhe Coal Industry Co., Ltd., 100% owned by Shanxi Coal.
Both the exploration and the Report were completed in accordance to the Rules of Coal Mine Survey and its revision issued by the Ministry of Energy of the People's Republic of China ("PRC"), Rules for Coal and Peat Exploration and Classification of Mineral Resources and Reserves as well as some other mineral industry standards of the PRC.
According to the Report, Da Wa Coal is a low gas coal mine. The integrated mining area comprises three main coal seams as No. 9, No. 10 and No. 11 coal seams. The mine hydrogeological condition of No. 9 seam is simple and No. 10 and No. 11 are moderate in term of complexity. No. 9 coal reserves is natural coking, No. 10 and No. 11 is of high calorific lean coal.
The available reserves of Da Wa Coal is 10.8 million metric tons. The available reserves of No.9 is 1.94 million metric tons and its calorific value is from 27.88 to 32.51 MJ/KG (6,659 to 7,765Kcal/KG). The available reserves of No. 10 is 4.19 million metric tons with calorific value from 25.33 to 33.52 MJ/KG (6,050-8,006Kcal/KG). No. 11 is 4.65 million metric tons with calorific value from 26.38 to 33.59 MJ/KG (6,300-8,022Kcal/KG).
"Given our experience working with the Shanxi province's technical reviewer on Da Wa Coal, we expect the review and approval process for the geological technical reports for the other Pinglu Project mines to proceed much more smoothly. We have already delivered the geological technical report for the Guanyao mine and expect it to be approved soon," Mr. Zhu concluded.
About Puda Coal, Inc.
Puda Coal, through its subsidiaries, supplies premium high grade metallurgical coking coal used to produce coke for steel manufacturing in China. The Company currently possesses 3.5 million metric tons of annual coking coal capacity. The Company has recently moved upstream into coal mining, as a consolidator and acquirer of coal mines in Shanxi Province, including the Pinglu projects and the Jianhe projects. On September 30, 2009, Shanxi Coal, a 90% indirect subsidiary of the Company, was appointed by the Shanxi provincial government as an acquirer and consolidator of eight thermal coal mines located Pinglu County in southern Shanxi Province. Shanxi Coal plans to consolidate the eight coal mines into five, increasing their total annual capacity from approximately 1.6 million to 3.6 million metric tons. Shanxi Coal received another approval by the Shanxi provincial government to consolidate four additional coking coal mines into one coal mine in Huozhou County. After the completion of the consolidation, the Jianhe project is expected to increase the total annual capacity from 720,000 metric tons to 900,000 metric tons, according to the Shanxi provincial government's approval. For more information, please visit http://www.pudacoalinc.com.
Forward-Looking Statements
The information contained herein includes forward-looking statements. These statements relate to future events or to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. For example, the closing of the transactions contemplated under each coal mine acquisition agreement is subject to various closing conditions, and the anticipated annual capacity of the acquired coal mines will be subject to risks and uncertainties relating to market and geological conditions as well as our management's ability to operate and manage the coal mines. We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.
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