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A CAP’s plan to monetize coal

Publishing Date : 19 March, 2018


A Cap Resources Limited, an Australian Security Exchange (ASX) listed uranium exploration company with ten prospecting licenses covering a total area of about 70 000 in squared kilometeres has through its half year results highlighted their future plans.

The Consolidated Group plans to continue to progress their  Letlhakane Uranium Project’s feasibility studies ensure the project is capable of early production and continue to evaluate options to divest our coal assets. To achieve these objectives, the Consolidated Group’s continuing viability, its ability to continue as a going concern and to meet its debts and commitments as they fall due, the Board of Directors of the Consolidated Group have noted through their half year results that they will continue utilizing their strong record of raising capital from its existing and prospective investors to cater for future developments.

The management has indicated that they are anticipating future expenditure on its current rights of tenure to exploration and mining tenements up until the expiry of its current Prospecting Licenses. They have further noted that this is in line with the tenement renewals and extensions that have been applied for but not yet granted. In the event the Consolidated Group does not meet the minimum exploration expenditure, they have explained that there lies a possibility of their licences being cancelled or ceasing the opportunity to be renewed.

A Cap has also indicated that they have to strongly engage their ability to implement cost reductions. The strategy to manage costs where appropriate emerges after the company reports that in their half year ending continue to monitor any cost reductions already implemented to continue diverting from the net losses of 2016.As at 31 December 2017, the Consolidated Group had $ 2,487,525 in cash (30 June 2017: $ 3,933,829) and Net investment outflow for their half year attributable to its exploration program was $ 669,299.

Due to the rising demand of coal, the group has noted that it continues to investigate commercial options in regards to our coal assets. They have also indicated that the coal consumption ration remains their best investment opportunity noting that if it were to fail, they would be unable to realize their assets, nor acquit its liabilities, in accordance with its basis of preparation of the released financial statements.

A-Cap’s Coal projects consists of the Foley Coal Project (which comprises two PL’s Foley PL125/2009 and Bolau PL138/2005) and the Mea Coal Project (PL134/2005). The Company is currently considering options to release value and monetize the coal tenement assets through joint venture participation, corporate re-organisation and assets sale. In October, the Group executive has explained that the Ministry of Mineral Resources, Green Technology and Energy Security of Botswana approved the extension of the Company’s Foley Coal Project and Mea Coal Project prospecting licenses.

They have explained that they have been granted a 2 year extension and they will commence production from 1 October 2017 to 30 September 2019. The exploration company has further indicated that their results continue showing dire need to explore and utilize existing markets.



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