Thelon Purchases Clear Fork Mining Co., Jellico Coal Project
December 20 2010 - 7:30AM
Marketwired
Thelon Capital Ltd. (TSX VENTURE: THC)(FRANKFURT: TFHC) is pleased
to announce that it has exercised its option to purchase Clear Fork
Mining Co., whereby Thelon will acquire the Jellico Coal Project in
Tennessee, as per the Letter of Agreement announced May 18, 2010.
The Jellico Coal Project consists of 6350 acres of fee simple
land in the Cambell and Claiborne counties in the State of
Tennessee. On March 1st 2006 Mountainside Mining Co. of Kentucky
entered into a lease agreement with Clear Fork to permit and mine
640 acres of the Jellico Project. Mountainside Mining is a private
contract miner. During the fiscal year of 2010 they have mined
185,600 tons of Compliant Coal resulting in royalty payments to
Clear Fork of approximately $1.1 million. Production increased
throughout the year and Mountainside Mining Co. expects to further
increase production in 2011 as well as add additional tons under
permit. There are approximately 3 million tons of Coal under permit
with an expected mine life of 8 years.
According to a report authored by A. R. Leamon in July 2009 the
Jellico Project consists of approximately 13 million Tons of high
quality compliant Thermal, Metallurgical and Silicon Metal coals.
This is a historic report and is not 43-101 compliant and therefore
cannot be relied upon. The company is conducting a work program to
confirm and expand the historic reserve and have a NI 43-101 report
completed.
The purchase agreement requires Thelon to pay $1 million on
signing, $3 million in cash on March 25, 2011 and take over debt
obligations of $4.8 million. The vendor will also hold a 10 yr note
for $8.45 million bearing 6% interest. The company has raised
approximately $1 million in the exercise of warrants and options to
make the signing payment.
"The purchase of the Jellico project and its production is an
important milestone for Thelon, as we build the company into a
premier producer in the coal industry. We look forward to a long
working relationship with this talented and experienced team,"
stated Jason Walsh, President of the company.
Thelon and its Directors would like to welcome William Cousins
to the Advisory Board Mr. Cousins has extensive experience in
owning and operating Coal mines in the Appalachians. He will be the
managing director of Clear Fork Mining Co.
Timothy Webb P.E., a qualified person under national instrument
43-101, has approved the technical information contain in this news
release.
THELON CAPITAL LTD.
On behalf of the Board of Directors
Jason Walsh, President
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of this News
Release.
Contacts: Thelon Capital Ltd. Jason Walsh President (604)
682-1643 (604) 682-1666 (FAX) www.theloncapital.com
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