News Archive

27 April 2006

New coal supply contracts signed

ATH Resources plc (AIM:ATH.L), one of the UK’s largest coal producers, through its wholly owned subsidiary Aardvark TMC Ltd, today announces that it has entered into two new sales contracts.

Drax Power Ltd, the owner of the UK's largest coal fired power station, is to be supplied with a further 500,000 tonnes of coal from the Skares Road site, over and above that announced in September 2004. This volume will be supplied by December 2007.

E.ON UK plc, the UK’s largest integrated power and gas company, has agreed to be supplied with 800,000 tonnes of coal, over two years, for delivery from April 2008, with an option for a further 200,000 tonnes.

These contracts have a combined value of more than £45 million.

ATH Resources has supplied the Drax Power station with over 3.3Mt of coal without interruption since 1999. At current output levels Drax supplies approximately 7% of the UK’s electricity.

E.ON generates enough electricity to cater for the needs of around eight million homes from a portfolio of gas-, coal- and oil-fired power stations and ATH Resources has supplied E.ON coal-fired power stations at Ratcliffe and Ironbridge since 2001 with some 1.4Mt of coal.

Commenting on the contract, Tom Allchurch, Chief Executive of ATH Resources said: “These contracts, which we are delighted to have been awarded, will underwrite the development of our new and existing sites. They are important contract awards as they demonstrate the need of generators to secure supplies for several years ahead.”

 

For further information:
ATH Resources
Tom Allchurch, Chief Executive	Tel: +44 (0) 1302 760 462
tom.allchurch@ath.co.uk
Media enquiries:
Abchurch
Sarah Hollins/Sarah Hollins	Tel: +44 (0) 20 7398 7700
sarah.hollins@abchurch-group.com	www.abchurch-group.com

 

Notes to Editors:

ATH Resources plc is an AIM-listed operator of opencast coal mines in the UK with its current three operational mines, Skares Road, Garleffan and Grievehill, located near New Cumnock, East Ayrshire in Scotland. The Group is currently the third largest producer of coal in the UK producing approximately 1.5 million tonnes per annum. Coal was used to generate 32.7 per cent of the UK’s electricity in 2004 and the Group holds coal supply contracts with four of the UK’s main electricity generating companies.

The management team has been in place since 1998. It acquired the rights to operate (and subsequently acquire) the Skares Road mine with support from The Alchemy Plan and Bank of Scotland. Following ATH Resource’s incorporation in October 2003, and backed by a follow on investment from The Alchemy Plan, the Company acquired the Garleffan mine in November 2003.

In June 2005 the Group acquired two new opencast sites, Grievehill and Glenmuckloch in Scotland for £18 million using the £16.8 million raised by way of an Open Offer on the basis of 1 New Ordinary Share for every 3 Existing Ordinary Shares. The acquisition increased the Group’s reserve base by 160% and provided longer term stability to the business.

In addition to its operating mines, the Group also has a number of other coal mining projects in Scotland and two through its French subsidiary, SRMMC, including a series of six existing coal concessions in south-central France covering an area of 36km ² , with an estimated resource of approximately 4.5 million tonnes of recoverable coal.

ATH Resources listed on the AIM market of the London Stock Exchange in June 2004.

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