The Canada-based company said coal production and brokerage firm Blue Star Energy would purchase up to 15,000 clean tons of product monthly from the operation, which is scheduled to officially begin production “within the week”

Kentucky-based Blue Star serves industrial coal users and electricity suppliers in the Appalachian region.

With the completion of its analysis of the Jellico seam from which mine No. 1 will extract, NAG is expecting coal deliveries to begin immediately when the mine ramps up.

NAG announced the start of mine No. 1 last month, stating that production would begin sometime in October. It inked an agreement with Engle Hollow Mining, a NAG operator, and Kentucky Mine Power for mining and auger services as it extracts from the Jellico seam.

The company noted that Kentucky Mine Power would mobilize two units immediately, perform development work over the following 10 days and begin production the following week. The coal from No. 1 will be the first to be processed by the Cobra tippling production plant.

When in full production, the complex is expected to use both auger and highwall mining methods.

Dean Schafer is acting as operations manager for all of NAG’s coal leases in the state and is implementing an overall mine plan for the company.

The producer said in mid-September that it had inked a letter of intent with Safeco to operate the new Cobra preparation plan complex. The 19-acre property, which also includes a rail loading facility, will become a central operation and distribution port for NAG.

“Based on the thickness of the coal seam, auger mining can produce 4000-6000 net tons per month with an increase to plus-20,000 net tons per month if highwall mining techniques are commenced,” the company said.

Production from the permit is expected to last between 12 and 18 months.

Samples pulled from the complex on August 26 reflect an ash range of 2.27-4.67%, 0.79-1.1% sulfur, and 13,656-13,996 BTU.

Based in Vancouver, North American Gem has a coal focus in North America, specifically Saskatchewan, Kentucky and West Virginia.