The documentation for the proposed mine, which is anticipated to employ highwall, auger and surface methods, was turned over recently to the Kentucky Department of Natural Resources.
Both the Jellico and Blue Gem seams are included in the permit’s mine plan; the former is high-quality steam product while the latter is a specialty coal used typically for silicon metal production.
Durabo Drilling has been secured to perform drilling work at No. 3 as well as the planned No. 4 mine. The firm will drill at No. 3 during December, and the core data will allow the producer to prepare a report of estimated mineable coal reserves from Blue Gem as well any seams below.
In total, the producer has about 5000 acres of coal reserve leases in Knox and Whitley counties in Kentucky, and is actively developing seven for permits – the first of which, North American Gem No. 1, went into production less than a week ago.
Additionally, NAG said earlier this month, it is expecting approval for its official permit application on North American Gem No. 2 from the KDNR shortly.
In late October, the producer executed the operating agreement with Safeco for the Cobra Preparation Facility in Corbin, Kentucky; the first coal processed from the facility will be from the No. 1 mine. The facility is 4 miles (6.5km) from the planned location of No. 3.
The deal included an open-ended lease for the 19-acre property that includes the Cobra tippling production plant and rail loading facility. The facility will become a central operation and distribution point and will crush, screen and wash as well as allow the company to purchase outside product for blending.
“North American Gem Inc. now has the ability to service a variety of customers by not only preparing coal to meet specific requirements but also the ability to purchase outside coal for producing custom-blended products for increased market potential,” NAG said at the time.
The facility will be serviced by CSX railroad and enough rail capacity exists to accommodate the loading of unit trains (110 railcars), which in turn will help the company realize more favorable rates.
Based in Vancouver, North American Gem has a coal focus in North America, specifically Saskatchewan, Kentucky and West Virginia.
