<p>Warrior Met Coal Inc is relaunching the development of its Blue Creek reserves into a new, world-class longwall mine located in Alabama near its existing mines. Once completed, this transformational growth investment will reinforce Warrior’s position as the premier US pure-play producer of premium metallurgical coal products that are sought by customers throughout the global steel industry. Previously, the Company had delayed the development of the Blue Creek reserves due to the uncertainty of COVID-19, as well as market conditions and the labor strike. As market conditions have significantly improved and the Company’s cash generation and cash on hand have significantly increased, the Company has decided now to move forward with the development.</p><p>Since the initial announcement, inflation in steel and other commodity prices, including labor costs, have increased the total capital spending requirements of the project. However, during a refresh of the project, the Company has identified potential production increases of approximately 10% and anticipates being able to accelerate the start of longwall production by approximately fifteen months based on design modifications and projected stronger available liquidity to fund the project. Based on an assumed met coal price of USD 150 per metric ton, the projected net present value is approximately USD 1 billion over the life of the mine with a projected after-tax internal rate of return of nearly 30% and an expected payback of approximately two years from initial longwall production.</p><p>The Blue Creek development will be a single longwall mine and is expected to have the capacity to produce an average of 4.8 million short tons per annum of premium High-Vol A met coal over the first ten years of production. It is one of the last remaining large-scale, untapped premium High Vol A met coal reserves in the US.</p><p>Once fully developed, the Company expects Blue Creek to increase Warrior’s annual production capacity by 60% and expand its product portfolio to its global customers, by offering three premium hard coking coals that are expected to achieve the highest premium met coal prices in the seaborne markets.</p>
<p>Warrior Met Coal Inc is relaunching the development of its Blue Creek reserves into a new, world-class longwall mine located in Alabama near its existing mines. Once completed, this transformational growth investment will reinforce Warrior’s position as the premier US pure-play producer of premium metallurgical coal products that are sought by customers throughout the global steel industry. Previously, the Company had delayed the development of the Blue Creek reserves due to the uncertainty of COVID-19, as well as market conditions and the labor strike. As market conditions have significantly improved and the Company’s cash generation and cash on hand have significantly increased, the Company has decided now to move forward with the development.</p><p>Since the initial announcement, inflation in steel and other commodity prices, including labor costs, have increased the total capital spending requirements of the project. However, during a refresh of the project, the Company has identified potential production increases of approximately 10% and anticipates being able to accelerate the start of longwall production by approximately fifteen months based on design modifications and projected stronger available liquidity to fund the project. Based on an assumed met coal price of USD 150 per metric ton, the projected net present value is approximately USD 1 billion over the life of the mine with a projected after-tax internal rate of return of nearly 30% and an expected payback of approximately two years from initial longwall production.</p><p>The Blue Creek development will be a single longwall mine and is expected to have the capacity to produce an average of 4.8 million short tons per annum of premium High-Vol A met coal over the first ten years of production. It is one of the last remaining large-scale, untapped premium High Vol A met coal reserves in the US.</p><p>Once fully developed, the Company expects Blue Creek to increase Warrior’s annual production capacity by 60% and expand its product portfolio to its global customers, by offering three premium hard coking coals that are expected to achieve the highest premium met coal prices in the seaborne markets.</p>
