11:22 EST Tuesday, January 19, 2010
CALGARY
,
Jan. 19
/CNW/ - Cobalt Coal Corp. (TSX-V: CBT) ("Cobalt" or the "Corporation") announced today that it has executed a sales contract with Riverside Energy Inc. ("Riverside"), a wholly owned subsidiary of Alpha Natural Resources Inc. (NYSE:ANR) whereby Riverside has agreed to purchase metallurgical coal from Cobalt's Westchester Coal Mine in McDowell County, West Virginia USA. Terms of the sales contract include a fixed price for 8,000 tons of coal from Westchester per month over a period of twelve months. Any production above this amount will be sold into the spot market. Cobalt has targeted
March 1st, 2010
as the start date for commercial coal production into the aforementioned sales contract.
In commenting on this development, Cobalt President and CEO David M. Lewis stated: "This is a pivotal event for our company as our Westchester Coal Mine can now be returned to operational status. The completion of this sales contract is very important as it has allowed us to hedge the bulk of our production in 2010, while still permitting acceptable exposure of the Corporation to what is a rapidly strengthening spot market for metallurgical coal."
The near term cash flow from the Westchester Coal Mine will allow Cobalt to continue to aggressively pursue its growth strategy of acquiring and developing known deposits of high grade metallurgical coal in the Appalachian region of the USA.
The Westchester Coal Mine was producing high grade metallurgical coal from Q4 2008 until the end of Q2, 2009. Production at the Mine was temporarily suspended in April, 2009 due to world economic conditions.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."
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.
