BOISE, Idaho, Oct. 21, 2013 /PRNewswire/ -- Blaze Energy (OTC Markets: BLZE) today announced that, effective October 1, 2013, it has entered into a partnership agreement to process and sell coal at the GreenFields coal mine located in Gary, West Virginia.
The GreenFields coal mine was previously owned and operated by U.S. Steel Corporation, depositing over its 40 years in operation, an estimated 10 million tons of coal fines and 20 to 25 million tons of coarse coal. The Company plans to process this high-quality, metallurgical grade coal for re-sale domestically and abroad. Effective October 2, 2013, the Company has executed an initial allocation letter with a third-party purchaser for the sale of 960,000+/- metric tons of processed coal; a more definitive agreement is currently pending. At current market conditions, full performance under the agreement would result in $117,500,000 in gross revenues annually, and based on internal projections, net revenue of approximately $26,000,000.
Pursuant to the agreement, the Company will (i) purchase annually a minimum of $4,080,000 worth of mined coal for processing from GreenFields; (ii) make advances on its coal purchase in the amount of $500,000 to GreenFields; if necessary, make additional advances to GreenFields in improvements to the mine, estimated at $600,000. The agreement has an initial term of 24 months, with renewals for an additional 48 months if agreed to by the Company and GreenFields.
A. Leon Blaser, Chairman and CEO commented: "We are grateful to GreenFields for the opportunity before us. With its existing reserves, rail accessibility, and geographic location, the ability to operate out of the GreenFields site was critical to the Company's business model, and the fulfillment of the pending coal sales agreement abroad. We look forward to working with GreenFields, and enjoying great returns in the process."
The Company will continue to report its progress as it business and operations develop, and may also be viewed at www.blazeenergycorp.com on the web, and by searching "Blaze Energy Corp" via Twitter and Facebook. Information on GreenFields Coal Company may be viewed at www.greenfieldscoal.com. The above release should be read in conjunction with past submissions of the Company filed with the Securities and Exchange Commission, future filings detailing the underlying acquisition, on Form 8-K or otherwise, and can be obtained online at www.sec.gov.
This press release includes forward-looking statements as defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 relating to matters such as prospects, anticipated operating and financial performance. Actual prospects and performance may differ from anticipated results due to economic conditions and other risks, uncertainties and circumstances partly or totally outside the control of the company, including risks of production variances from expectations, market volatility, the level of capital expenditures required to fund ongoing drilling initiatives and the ability of the company to execute its business strategy. These and other risks are described in the company's reports filed with the United States Securities and Exchange Commission. These forward-looking statements are made only as of the date of this communication and Blaze Energy undertakes no obligation to update or revise these forward-looking statements.
SOURCE Blaze Energy