It is reported that Erdene Resource Development Corp will probably have to pull out of the Donkin coal project in Cape Breton unless it finds a new partner.

In April, global giant Xstrata Coal which owns a 75% interest in the Donkin mine said it was pulling out and trying to find another project operator.

Mr Peter Akerley Erdene president and chief executive officer said that Xstrata had hired Citibank to beat the bushes for potential buyers. That process should be concluded by the end of the year.

If Xstrata fails to find someone to operate the project, he said it was extremely unlikely that Erdene which has a 25% interest in the project would continue the exploration phase by itself.

That admission is not overly surprising: the Dartmouth junior mining company had revenues of less than USD 900,000 in 2011.

Later this fall, Mr Akerley told shareholders, the company plans to separate the company’s coal assets and its metals interests in Mongolia into two separate entities. He said that the move would prevent unnecessary dilution of both assets.

Source - The Chronicle Herald

(www.coalguru.com)