18:08 EDT Tuesday, October 27, 2009
CALGARY, ALBERTA--(Marketwire - Oct. 27, 2009) - Cobalt Coal Corp. (TSX VENTURE:CBT) ("Cobalt" or the "Corporation") announced today that it has exercised its option to acquire metallurgical coal mineral rights on properties owned by Fox Development Corporation ("Fox"), a Kentucky mining corporation. In exchange for a cash payment of $40,000 and a 7.5% Over Riding Royalty ("ORR") reserved for Fox, Cobalt will be granted a 100% working interest in certain coal properties in Pike County, Kentucky, near Cobalt's regional headquarters in neighbouring West Virginia. Additionally, Cobalt will have an eighteen month option period to buy out the ORR for US $650,000.
Cobalt intends to submit applications immediately to the applicable state and federal mining authorities to obtain the necessary permits that may be required to commence commercial coal production.
In discussing the Fox acquisition, David M. Lewis, President and CEO of Cobalt, commented, "The purchase of the Fox asset represents a significant step forward in Cobalt's regional coal production business. Once regulatory requirements have been satisfied with respect to the Fox acquisition, we expect to proceed immediately with the commencement of commercial production at this property."
About Cobalt:
Cobalt is a metallurgical coal acquisition and production company whose common shares are publicly traded on the TSX Venture Exchange. Cobalt is focused on the acquisition and development of known metallurgical coal deposits in the Appalachian coal producing region of the United States. The Corporation has its head office in Calgary, Alberta and has an operating office in Welch, West Virginia.
This news release contains forward-looking statements that involve risks and uncertainties. Forward-looking statements or information are based on current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by Cobalt. The forward-looking statements or information contained in this news release are made as of the date hereof and Cobalt does not undertake any obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
