LONDON (Alliance News) - Anglo Pacific Group PLC Friday said it has received the outstanding balance that it was owed from Atrum Coal NL related to the sale of the London-listed company's coal licences back in late 2014, which has been partly satisfied through two new royalties.
Anglo Pacific, which generates income from securing royalties, said the outstanding amount due under its promissory note receivable from Atrum Coal and its subsidiary, Atrum Coal Groundhog Inc, has now been settled.
The promissory note, which is essentially a promise by a party to pay a stated sum at a specified date, was issued as part consideration for the sale of Anglo Pacific's coal licences in September 2014.
The outstanding balance stood at USD1.4 million, including interest, and has now been settled after Atrum Coal paid Anglo Pacific USD600,000 in cash and issued the company with two new royalties.
Anglo Pacific will now receive a 0.5% gross revenue royalty over all production within Atrum's Groundhog anthracite project in British Colombia, Canada. The company will begin receiving those royalty payments once commercial production starts, and they will last for a ten-year stint.
Anglo Pacific will also receive a 0.1% gross revenue royalty from production derived from the Groundhog North Mining Complex project area, it said.
Importantly, the company said its other royalty agreement with Atrum, which was agreed when it sold the coal licenses, remains in place. Anglo Pacific will continue to retain either a 1.0% gross revenue royalty or a royalty of USD1.0 per tonne of production - whichever is higher - from the areas acquired by Atrum in 2014.
"We are pleased to have recovered the full value of our outstanding promissory note, and in the process increased our royalty exposure to Atrum's high quality anthracite project. We look forward to the project progressing into production," said Chief Executive Julian Treger.
Anglo Pacific shares were trading up 2.8% to 74.50 pence per share on Friday morning.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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