Company's Deane Mining complex is a state-of-the-art facility with operator projecting 1.0 million tons of production in the first year
Multi-year lease allows Company to further monetize its extensive asset base and generate high-margin revenue
Lessee takes over holding costs for permits and agrees to pay American Resources the higher of $5.00 per ton for or 5% of gross sales price for processed coal
FISHERS, IN / ACCESSWIRE / April 29, 2022 / American Resources Corporation (NASDAQ:AREC) ("American Resources" or the "Company"), a next generation and socially responsible supplier of rare earth and critical elements, carbon and advanced carbon materials to the new infrastructure and electrification marketplace, today announced that it has entered into a multi-year lease of it Deane Mining complex to a high quality, local, third-party operator named Bluegrass Resources.
Mark Jensen, CEO of American Resources Corporation commented, "As one of the largest owners of mining infrastructure in our region, we are happy to have entered into this lease and partnership with a very reputable local operator. Our Deane Mining complex is a top-tier asset and idled complex, but does not happen to be in our current operational plan, nor in our next phase of growth plans over the next five years. Given the current strength in the worldwide carbon markets, this lease allows us to continue to capitalize on the current environment by monetize our noncore assets, help keep the community working and brings additional value to our shareholders. We have known the owners of Bluegrass Resources, for a number of years and have confidence in their ability to execute and create value for our shareholders and theirs."
Jason McCoy, Manager of Bluegrass Resources commented, "Our team has owned and operated numerous complexes over the years and based on our extensive planning and due diligence, the Deane Mining complex is one of the top-tier. The American Resources team has kept this complex in pristine condition and coal ready, which enables us to move quickly in getting the complex back up and running and to create jobs within the region. I, and the rest of the Bluegrass Resources team are excited to hit the ground running at this complex and take advantage of this structure and market environment for both our shareholders and American Resources shareholders."
The Company's Deane Mining complex, located in Letcher County, Kentucky, contains a state-of-the-art, 800 ton per hour carbon processing facility, logistics infrastructure including batch weight unit train loadout on CSX rail, and access to abundant onsite and nearby mining capabilities. American Resources acquired the Deane Mining complex in December of 2015 from Rhino Resources Partners LP and operated it until 2019.
Under the terms of the lease to the third party, American Resources will receive an upfront cash payment of $100,000 a month for the first two months and then $20,000 monthly minimum until in production. Once in production American Resources will receive the higher of $5.00 per ton or 5% of gross sales price generated from the Deane Mining complex, among other terms of the transaction. The term of the lease is for a five-year period with renewable options thereafter.
American Resources continues to focus on running efficient streamlined operations in being a new-aged supplier of raw materials to the infrastructure and electrification marketplace in the most sustainable of ways, while also helping the world achieve its goals of carbon neutrality. By operating with low or no legacy costs and having one of the largest and most innovative growth pipelines in the industry, American Resources Corporation works to maximize value for its investors by positioning its large asset base to best fit a new-aged economy, while being able to scale its operations to meet the growth of the markets it serves.
About American Resources Corporation
American Resources Corporation is a next-generation, environmentally and socially responsible supplier of high-quality raw materials to the new infrastructure market. The Company is focused on the extraction and processing of metallurgical carbon, an essential ingredient used in steelmaking, critical and rare earth minerals for the electrification market, and reprocessed metal to be recycled. American Resources has a growing portfolio of operations located in the Central Appalachian basin of eastern Kentucky and southern West Virginia where premium quality metallurgical carbon and rare earth mineral deposits are concentrated.
American Resources has established a nimble, low-cost business model centered on growth, which provides a significant opportunity to scale its portfolio of assets to meet the growing global infrastructure and electrification markets while also continuing to acquire operations and significantly reduce their legacy industry risks. Its streamlined and efficient operations are able to maximize margins while reducing costs. For more information visit americanresourcescorp.com or connect with the Company on Facebook, Twitter, and LinkedIn.
About American Rare Earth LLC
American Rare Earth is redefining how critical and rare earth elements are both sourced and processed while focusing on the recycling of end-of-life products such as rare earth permanent magnets and lithium-ion batteries, as well as coal-based waste streams and byproducts to create a low-cost and environmentally-safe, circular supply chain. American Rare Earth has developed its innovative and scalable "Capture-Process-Purify" process chain in conjunction with its licensed intellectual property including 16 patents and technologies and sponsored research partnerships with three leading universities to support the domestic supply chain's growing demand for magnet and battery metals. For more information visit arareearthcorp.com or connect with the Company on Facebook, Twitter, and LinkedIn.
Special Note Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks, uncertainties, and other important factors that could cause the Company's actual results, performance, or achievements or industry results to differ materially from any future results, performance, or achievements expressed or implied by these forward-looking statements. These statements are subject to a number of risks and uncertainties, many of which are beyond American Resources Corporation's control. The words "believes", "may", "will", "should", "would", "could", "continue", "seeks", "anticipates", "plans", "expects", "intends", "estimates", or similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Any forward-looking statements included in this press release are made only as of the date of this release. The Company does not undertake any obligation to update or supplement any forward-looking statements to reflect subsequent events or circumstances. The Company cannot assure you that the projected results or events will be achieved.
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SOURCE: American Resources Corporation
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