TIDMPDZ
RNS Number : 4492L
Prairie Mining Limited
30 April 2020
PRAIRIE MINING LIMITED
NEWS RELEASE | 30 April 2020
MARCH 2020 QUARTERLY REPORT
Summary during, and subsequent to the quarter end,
-- Prairie continued to:
Assess its options in relation to the investment dispute between
Prairie and the Polish Government that has arisen out of certain
measures taken by Poland in breach of the Energy Charter Treaty,
and the Australia-Poland Bilateral Investment Treaty
Work with its lawyers (including international arbitration legal
experts) to finalise arrangements for commencing international
arbitration claim(s) against Poland
Strongly defend its position and take relevant actions to pursue
its legal rights regarding both the Debiensko and Jan Karski
projects
Identify and assess other suitable business opportunities in the
resources sector
-- During the quarter, Prairie received a favorable judgement
from the Polish Administrative Court that found the Ministry of
Environment had violated provisions of law in refusing to grant
Prairie the Debiensko concession amendment
-- The court judgement formally revokes the Ministry of
Environment's April 2018 decision denying the Debiensko concession
amendment, and requires the body to reconsider Prairie's amendment
application
-- There have been no material discussions between the Company
and JSW with respect to potential co-operation regarding Prairie's
Polish coal projects during and subsequent to the March 2020
quarter
Enquiries
Prairie Mining Limited +44 20 7478 3900
Ben Stoikovich, Chief Executive info@pdz.com.au
Officer
Sapan Ghai, Head of Corporate
Development
This announcement as been authorised for release by the
Company's Chief Executive Office, Mr Ben Stoikovich .
Debiensko Mine
The Debiensko Mine ("Debiensko"), is a hard coking coal project
located in the Upper Silesian Coal Basin in the south west of the
Republic of Poland. It is approximately 40 km from the city of
Katowice and 40 km from the Czech Republic.
Debiensko is bordered by the Knurow-Szczyglowice Mine in the
north west and the Budryk Mine in the north east, both owned and
operated by Jastrz bska Spó ka W glowa SA ("JSW"), Europe's leading
producer of hard coking coal.
The Debiensko mine was historically operated by various Polish
mining companies until 2000 when mining operations were terminated
due to a major government led restructuring of the coal sector
caused by a downturn in global coal prices. In early 2006 New World
Resources Plc ("NWR") acquired Debiensko and commenced planning for
Debiensko to comply with Polish mining standards, with the aim of
accessing and mining hard coking coal seams. In 2008, the Polish
Ministry of Environment ("MoE") granted a 50-year mine license for
Debiensko.
In October 2016, Prairie Mining Limited ("Prairie") acquired
Debiensko with a view that a revised development approach would
potentially allow for the early mining of profitable premium hard
coking coal seams, whilst minimising upfront capital costs.
Debiensko Concession
In December 2016, following the acquisition of Debiensko,
Prairie applied to the MoE to amend the 50-year Debiensko mining
concession.
The purpose of the concession amendment was to extend the time
stipulated in the mining concession for first production of coal
from 2018 to 2025. In April 2018, Prairie received a final "second
instance" decision from the MoE that has denied the Company's
amendment application. Prairie appealed this MoE decision to
Poland's Administrative Court, who have now ruled in Prairie's
favour confirming that the MoE's denial of Prairie's concession
amendment application violated provisions of Polish law, and that
the MoE's decision was defective. The Court indicated that the MoE
had not established legal grounds justifying rejection of Prairie's
amendment application. The court verdict formally revokes the MoE's
April 2018 decision denying the concession amendment, and requires
the MoE to reassess the concession amendment application in light
of the various defects in the MoE's original decisions as indicated
by the Court. The MoE has now appealed this decision to Poland's
Supreme Administrative Court. Despite Prairie holding a valid
environmental consent decision enabling mine construction, the
actions of the Polish Government have blocked any pathway to
production for Prairie at Debiensko therefore making it impossible
for the Company to continue with development at Debiensko.
Jan Karski Mine
The Jan Karski Mine ("Jan Karski") is a large scale semi-soft
coking coal project located in the Lublin Coal Basin in south east
Poland. The Lublin Coal Basin is an established coal producing
province which is well serviced by modern and highly efficient
infrastructure, offering the potential for low capital intensity
mine development. Jan Karski is situated adjacent to the Bogdanka
coal mine which has been in commercial production since 1982 and is
the lowest cost hard coal producer in Europe.
Key benefits for the local community and the Lublin and Chelm
regions associated with the development, construction and operation
of Jan Karski have been recognised as the following:
-- creation of 2,000 direct employment positions and 10,000
indirect jobs for the region once operational;
-- increasing skills of the workforce through the implementation
of International Standard training programmes;
-- stimulating the development of education, health services and
communications within the region; and
-- building a mine that creates new employment for generations
to come and career paths for families to remain in the region.
K6-7 Concession Awarded to Bogdanka
In April 2018, Prairie filed a civil law claim against the MoE
due to its failure to grant Prairie a mining usufruct agreement
over the Jan Karski concessions (which included the K6-7 deposit)
in order to protect the Company's security of tenure over the
project.
The Company had been awarded the Priority Right to apply for a
mining concession at Jan Karski in 2015 following its full
compliance with Poland's Geological and Mining Law ("GML").
Subsequent to Prairie's filing of the civil law claim discussed
above, the Polish District Court granted Prairie an injunction
preventing the MoE from granting prospecting, exploration or mining
concessions and concluding usufruct agreements with any other party
until full court proceedings were concluded.
In April 2019, an Appeal Court in Warsaw overturned the District
Court's decision and lifted the injunction. Prairie believes that
the Appeal Court's decision is fundamentally flawed. On 31 December
2019, Lubelski W giel BOGDANKA S.A ("Bogdanka") announced that the
MoE had granted Bogdanka a mining concession over the disputed K6-7
deposit which has been confirmed following receipt of official
communication from the MoE. This Polish government decision
represents an expropriation of the Jan Karski project from
Prairie.
The MoE's decision to grant a mining concession over the K6-7
deposit to Bogdanka is further evidence of the unfair and
inequitable treatment faced by Prairie as a foreign investor in
Poland and these and other measures directed against Prairie by the
Polish Government, with respect to the Company's permitting process
and licenses, have entirely blocked Prairie's pathway to any future
production from Jan Karski. As a result of this latest action by
the Polish government, the Company has taken the decision to
discontinue the ongoing environmental permitting procedure for the
Jan Karski mine which has been formally communicated to the RDOS in
Lublin, the regional government body responsible for the
Environmental Consent decision for the Jan Karski mine. The Company
continues to take all actions necessary to pursue its legal rights
regarding Jan Karski.
Corporate
Possible Co-Operation between Prairie and JSW
There have been no material discussions between the Company and
JSW with respect to potential co-operation regarding Prairie's
Polish coal projects during and subsequent to the quarter end. The
Non-Disclosure Agreement ("NDA") between the Company and JSW
expired at the end of September quarter 2019. The Company will
continue to comply with its continuous disclosure obligations
regarding any potential co-operation with JSW and make
announcements as required.
Dispute with the Polish Government
In February 2019, Prairie formally notified the Polish
Government that there exists an investment dispute between Prairie
and the Polish Government.
Prairie's notification calls for prompt negotiations with the
Government to amicably resolve the dispute and indicates Prairie's
right to submit the dispute to international arbitration in the
event the dispute is not resolved amicably. The dispute arises out
of certain measures taken by Poland in breach of the Energy Charter
Treaty and Australia-Poland Bilateral Investment Treaty. The
Company remains open to resolving the dispute with the Polish
Government amicably. As of the date of this report, no amicable
resolution of the dispute has occurred, since the Polish Government
has declined to participate in discussions related to the
dispute.
The decision by the Polish Government to grant Bogdanka a mining
concession over the K6-7 depos provides the Company with further
evidence of the unfair and inequitable treatment it has faced as a
foreign investor in Poland.
Accordingly, Prairie is currently working with its lawyers
(including international arbitration legal experts) to finalise
arrangements for commencement of international arbitration claim(s)
against Poland.
Prairie continues to take all necessary actions to pursue its
legal rights regarding its investments in Poland.
Prairie will continue to update the market in relation to this
matter as required.
COVID-19 Update
The Company continues to actively evaluate the situation for all
risks to employees and general operational safety and will make any
required adjustments as the situation evolves, or as required by
governments. Following the introduction of COVID-19 pandemic
working/travel restrictions, the Company's activities in Poland
have been limited, however relevant meetings have been able to take
place, via electronic means.
Forward Looking Statements
This release may include forward-looking statements. These
forward-looking statements are based on Prairie's expectations and
beliefs concerning future events. Forward looking statements are
necessarily subject to risks, uncertainties and other factors, many
of which are outside the control of Prairie, which could cause
actual results to differ materially from such statements. Prairie
makes no undertaking to subsequently update or revise the
forward-looking statements made in this release, to reflect the
circumstances or events after the date of that release.
APPIX 1 - EXPLORATION TENEMENT INFORMATION
As at 31 March 2020, the Company has an interest in the
following tenements:
Location Tenement Percentage Status Tenement Type
Interest
------------------- ----------------------- ----------- -------- ---------------------
Jan Karski, Poland Jan Karski Mine 100 Granted Exclusive Right
Plan Area (K-4-5, to apply for
K6-7, K-8 and K-9)(1) a mining concession
Debiensko, Poland Debiensko 1(2) 100 Granted Mining
Debiensko, Poland Kaczyce 1 100 Granted Mining & Exploration
(includes gas
rights)
------------------- ----------------------- ----------- -------- ---------------------
Notes:
(1) In July 2015, Prairie announced that it had secured the
Exclusive Right to apply for a Mining Concession for Jan Karski as
a result of its Geological Documentation for the Jan Karski deposit
being approved by Poland's MoE. The approved Geological
Documentation covers areas of all four original Exploration
Concessions granted to Prairie (K-4-5, K6-7, K-8 and K-9) and
includes the full extent of the targeted resources within the mine
plan for Jan Karski. The K-4-5, K-8 and K-9 Exploration Concessions
expired in November 2018 but these were separate to and had no
bearing on the Company's access to land and the Exclusive Right
(tenure) to apply for a mining concession at Jan Karski, however as
noted below, this position is the subject of Prairie's Mining
Usufruct Agreement proceedings in front of the Civil Court and the
award of a mining concession of K6-7 to Bogdanka. As a result of
the Exclusive Right, Prairie was the only entity with a legal right
to lodge a Mining Concession application over Jan Karski for the
period up and until 2 April 2018.
The approval of Prairie's Geological Documentation in 2015 also
conferred upon Prairie the legal right to apply for a Mining
Usufruct Agreement over Jan Karski for an additional 12-month
period beyond April 2018, which should have precluded any other
parties being granted any licence/concession over all or part of
the Jan Karski concessions. Under Polish law, the MoE is strictly
obligated, within three months of Prairie making an application for
a Mining Usufruct Agreement, to grant the agreement. It should be
noted that the MoE confirmed Prairie's priority right in two
written statements (i.e. in a final administrative decision dated
11 February 2016 and in a formal letter dated 13 April 2016).
Prairie applied to the MoE for a Mining Usufruct Agreement over Jan
Karski in late December 2017. As of the date of this report the MoE
has still not made available to Prairie a Mining Usufruct Agreement
for Jan Karski, therefore breaching the three-month obligatory
period for the agreement to be concluded. Advice provided to
Prairie concludes that failure of the MoE to grant Prairie the
Mining Usufruct Agreement is a breach of Polish law. Accordingly,
the Company commenced legal proceedings, which remain ongoing,
against the MoE through the Polish courts in order to protect the
Company's security of tenure over the Jan Karski concessions. Since
the MoE has not provided a decision within three months regarding
Prairie's Mining Usufruct Agreement application, the Polish civil
court has the power to enforce conclusion of a Usufruct Agreement
in place of the MoE. In the event that a Mining Usufruct Agreement
is not made available to the Company on acceptable terms or the
Company does not enter into a Mining Usufruct Agreement for any
other reason, other parties may be able to apply for exploration or
mining rights for all or part of the Jan Karski concession
area.
In April 2018, the Civil Court approved Prairie's motion for an
injunction against the MoE, which prevented them from entering into
a usufruct agreement or a concession with any other party besides
Prairie. A decision by an Appeal Court in Warsaw has since
overturned the injunction in place against the MoE. Prairie
believes that the Appeal Court's decision is fundamentally flawed.
Prairie has now received official notification from the Polish
government that the K6-7 deposit, which forms an integral part of
Prairie's Jan Karski project, has been granted to Bogdanka. Despite
multiple applications by Prairie to the MoE to be admitted as a
party of interest to Bogdanka's K6-7 mining concession proceedings,
the MoE has denied Prairie the status of party of interest which
effectively prevents Prairie from appealing the award of the K6-7
mining concession to Bogdanka. These events provide further
evidence of the unfair and inequitable treatment faced by Prairie
as a foreign investor in Poland and these and other measures
directed against Prairie by the Polish government, with respect to
the Company's permitting process and licenses, have entirely
blocked Prairie's pathway to any future production from Jan Karski.
Prairie has formally notified the Polish government that there
exists an investment dispute between Prairie and the Polish
Government. The dispute arises out of certain measures taken by
Poland in breach of the Energy Charter Treaty and the
Australia-Poland Bilateral Investment Treaty as discussed above.
Prairie's notification calls for prompt negotiations with the
government to amicably resolve the dispute, and indicates Prairie's
right to submit the dispute and lodge a claim to international
arbitration in the event the dispute is not resolved amicably.
Prairie will continue to take relevant actions to pursue its legal
rights regarding Jan Karski. Prairie is currently working with its
lawyers (including international arbitration legal experts) to
prepare submissions and finalise funding arrangements for
international arbitration claim(s) against Poland
(2) Under the terms of the Debiensko Mining Concession issued in
2008 by the MoE (which is valid for 50 years from grant date),
commencement of production was to occur by 1 January 2018. In
December 2016, following the acquisition of Debiensko, Prairie
applied to the MoE to amend the 50 year Debiensko Mining
Concession. The purpose of the concession amendment was to extend
the time stipulated in the Mining Concession for first production
of coal from 2018 to 2025. In 2018 Prairie received a final "second
instance" decision from the MoE that denied the Company's amendment
application. Prairie appealed this MoE decision to Poland's
Administrative Court and in November 2019 the Administrative court
ruled in Prairie's favour confirming that Prairie's concession
amendment application fulfilled all formal requirements under
Polish law and that the MoE was obliged to grant Prairie the
requested concession amendment. The court verdict indicated that
the MoE had not established legal grounds justifying rejection of
Prairie's amendment application. The MoE has now appealed this
decision to Poland's Supreme Administrative Court. Nevertheless,
Prairie also holds a valid environmental consent decision and
continues to have valid tenure and ownership of land at Debiensko.
Not meeting the production timeframe stipulated in the concession
does not automatically infringe on the validity and expiry date of
the Debiensko mining concession, which is June 2058. However, the
concession authority now has the right to request the concession
holder to remove any infringements related to non-compliance with
the conditions of the mining concession and determine a reasonable
date for removal of the infringements. Nevertheless, the actions of
the Polish government have effectively blocked any pathway to
production for Prairie at Debiensko therefore making it impossible
for the Company to continue with development at Debiensko. The
Company will consider any actions necessary to pursue its legal
rights regarding Debiensko. For this and other reasons, Prairie has
formally notified the Polish government that there exists an
investment dispute between Prairie and the Polish Government. The
dispute arises out of certain measures taken by Poland in breach of
the Energy Charter Treaty and the Australia-Poland Bilateral
Investment Treaty. Prairie's notification calls for prompt
negotiations with the government to amicably resolve the dispute,
and indicates Prairie's right to submit the dispute and lodge a
claim to international arbitration in the event the dispute is not
resolved amicably.
Appendix 2 : Related Party Payments
During the quarter ended 31 March 2020, the Company made
payments of $ 189,432 to related parties and their associates.
These payments relate to existing remuneration arrangements
(director fees, consulting fees and superannuation of $129,432) and
the provision of a serviced office and company secretarial and
administration
services ($60,000).
Appendix 5B
Mining exploration entity or oil and gas exploration entity
quarterly cash flow report
Name of entity
-----------------------------------------------------
Prairie Mining Limited
ABN Quarter ended ("current quarter")
--------------- ----------------------------------
23 008 677 852 31 March 2020
----------------------------------
Consolidated statement of cash Current quarter Year to date
flows
$A'000 (9 months)
$A'000
1. Cash flows from operating
activities
1.1 Receipts from customers - -
1.2 Payments for
(a) exploration & evaluation
(if expensed) (552) (1,991)
(b) development - -
(c) production - -
(d) staff costs (241) (727)
(e) administration and corporate
costs (255) (794)
1.3 Dividends received (see note - -
3)
1.4 Interest received 15 72
1.5 Interest and other costs of -
finance paid
1.6 Income taxes paid - -
1.7 Government grants and tax - -
incentives
Other (provide details if
1.8 material)
(a) Business development costs (5) (53)
(b) Property rental and gas
sales 107 259
---------------- -------------
Net cash from / (used in)
1.9 operating activities (931) (3,234)
----- ----------------------------------- ---------------- -------------
2. Cash flows from investing
activities
2.1 Payments to acquire:
(a) entities - -
(b) tenements - -
(c) property, plant and equipment - (3)
(d) exploration & evaluation - -
(if capitalised)
(e) investments - -
(f) other non-current assets - -
2.2 Proceeds from the disposal
of:
(a) entities - -
(b) tenements - -
(c) property, plant and equipment - -
(d) investments - -
(e) other non-current assets - -
2.3 Cash flows from loans to other - -
entities
2.4 Dividends received (see note - -
3)
2.5 Other (provide details if - -
material)
---------------- -------------
Net cash from / (used in)
2.6 investing activities - (3)
----- ----------------------------------- ---------------- -------------
3. Cash flows from financing
activities
3.1 Proceeds from issues of equity
securities (excluding convertible
debt securities) - -
3.2 Proceeds from issue of convertible - -
debt securities
3.3 Proceeds from exercise of - -
options
3.4 Transaction costs related
to issues of equity securities - -
or convertible debt securities
3.5 Proceeds from borrowings - -
3.6 Repayment of borrowings - -
3.7 Transaction costs related
to loans and borrowings - -
3.8 Dividends paid - -
3.9 Other (provide details if - -
material)
---------------- -------------
3.10 Net cash from / (used in)
financing activities - -
----- ----------------------------------- ---------------- -------------
4. Net increase / (decrease)
in cash and cash equivalents
for the period
Cash and cash equivalents
4.1 at beginning of period 4,314 6,620
Net cash from / (used in)
operating activities (item
4.2 1.9 above) (931) (3,234)
Net cash from / (used in)
investing activities (item
4.3 2.6 above) - (3)
4.4 Net cash from / (used in)
financing activities (item - -
3.10 above)
Effect of movement in exchange
4.5 rates on cash held 1 1
---------------- -------------
Cash and cash equivalents
4.6 at end of period 3,384 3,384
----- ----------------------------------- ---------------- -------------
5. Reconciliation of cash and Current quarter Previous quarter
cash equivalents $A'000 $A'000
at the end of the quarter
(as shown in the consolidated
statement of cash flows) to
the related items in the accounts
5.1 Bank balances 1,634 1,314
5.2 Call deposits 2,000 3,000
5.3 Bank overdrafts - -
5.4 Other (provide details) - -
---------------- -----------------
Cash and cash equivalents
at end of quarter (should
5.5 equal item 4.6 above) 3,384 4,314
---- ----------------------------------- ---------------- -----------------
6. Payments to related parties of the entity Current quarter
and their associates $A'000
Aggregate amount of payments to related
parties and their associates included in
6.1 item 1 (189)
-----------------
6.2 Aggregate amount of payments to related
parties and their associates included in -
item 2
-----------------
Note: if any amounts are shown in items 6.1 or 6.2, your quarterly
activity report must include a description of, and an explanation
for, such payments
-------------------------------------------------------------------------
7. Financing facilities Total facility
Note: the term "facility' amount at quarter Amount drawn
includes all forms of financing end at quarter end
arrangements available to $A'000 $A'000
the entity.
Add notes as necessary for
an understanding of the sources
of finance available to the
entity.
7.1 Loan facilities - -
------------------- ----------------
7.2 Credit standby arrangements - -
------------------- ----------------
7.3 Other (please specify) - -
------------------- ----------------
7.4 Total financing facilities - -
------------------- ----------------
7.5 Unused financing facilities available at -
quarter end
----------------
7.6 Include in the box below a description of each facility
above, including the lender, interest rate, maturity date
and whether it is secured or unsecured. If any additional
financing facilities have been entered into or are proposed
to be entered into after quarter end, include a note providing
details of those facilities as well.
---- ------------------------------------------------------------------------
Not applicable
8. Estimated cash available for future operating $A'000
activities
Net cash from / (used in) operating activities
8.1 (Item 1.9) (930)
8.2 Capitalised exploration & evaluation (Item -
2.1(d))
8.3 Total relevant outgoings (Item 8.1 + Item (930)
8.2)
8.4 Cash and cash equivalents at quarter end 3,384
(Item 4.6)
8.5 Unused finance facilities available at quarter -
end (Item 7.5)
8.6 Total available funding (Item 8.4 + Item 3,384
8.5)
Estimated quarters of funding available
8.7 (Item 8.6 divided by Item 8.3) 4
---- ---------------------------------------------------------
8.8 If Item 8.7 is less than 2 quarters, please provide answers
to the following questions:
1. Does the entity expect that it will continue to have
the current level of net operating cash flows for the
time being and, if not, why not?
-------------------------------------------------------------------
Answer: Not applicable
-------------------------------------------------------------------
2. Has the entity taken any steps, or does it propose
to take any steps, to raise further cash to fund its operations
and, if so, what are those steps and how likely does it
believe that they will be successful?
-------------------------------------------------------------------
Answer: Not applicable
-------------------------------------------------------------------
3. Does the entity expect to be able to continue its operations
and to meet its business objectives and, if so, on what
basis?
-------------------------------------------------------------------
Answer: Not applicable
-------------------------------------------------------------------
Compliance statement
1 This statement has been prepared in accordance with accounting
standards and policies which comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters disclosed.
Date: 30 April 2020
Authorised by: Company Secretary
(Name of body or officer authorising release - see note 4)
Notes
1. This quarterly cash flow report and the accompanying activity
report provide a basis for informing the market about the entity's
activities for the past quarter, how they have been financed and
the effect this has had on its cash position. An entity that wishes
to disclose additional information over and above the minimum
required under the Listing Rules is encouraged to do so.
2. If this quarterly cash flow report has been prepared in
accordance with Australian Accounting Standards, the definitions
in, and provisions of, AASB 6: Exploration for and Evaluation of
Mineral Resources and AASB 107: Statement of Cash Flows apply to
this report. If this quarterly cash flow report has been prepared
in accordance with other accounting standards agreed by ASX
pursuant to Listing Rule 19.11A, the corresponding equivalent
standards apply to this report.
3. Dividends received may be classified either as cash flows
from operating activities or cash flows from investing activities,
depending on the accounting policy of the entity.
4. If this report has been authorised for release to the market
by your board of directors, you can insert here: "By the board". If
it has been authorised for release to the market by a committee of
your board of directors, you can insert here: "By the [ name of
board committee - eg Audit and Risk Committee ]". If it has been
authorised for release to the market by a disclosure committee, you
can insert here: "By the Disclosure Committee".
5. If this report has been authorised for release to the market
by your board of directors and you wish to hold yourself out as
complying with recommendation 4.2 of the ASX Corporate Governance
Council's Corporate Governance Principles and Recommendations , the
board should have received a declaration from its CEO and CFO that,
in their opinion, the financial records of the entity have been
properly maintained, that this report complies with the appropriate
accounting standards and gives a true and fair view of the cash
flows of the entity, and that their opinion has been formed on the
basis of a sound system of risk management and internal control
which is operating effectively.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
UPDGBGDSXUXDGGG
(END) Dow Jones Newswires
April 30, 2020 02:00 ET (06:00 GMT)
Prairie Mining (LSE:PDZ)
Gráfica de Acción Histórica
De Feb 2024 a Mar 2024
Prairie Mining (LSE:PDZ)
Gráfica de Acción Histórica
De Mar 2023 a Mar 2024