Canada-listed coal producer Novadx Ventures Corp. (TSX VENTURE:NDX) announced Jan. 19 that during December 2011, the company moved to full commercial production at the Rosa strip mine in Alabama.
Since the commencement of full production, the wash plant at the mine has produced about 13,800 tons of coal, which were sold at an average price of $166 per ton to customers in the coking coal and activated carbon industries. Total coal sales over this period were about $2.3 million yielding net revenues for coal sales of about $2 million to Novadx after payment relating to the Sandstorm Metals and Energy Ltd. coal sales agreement.
Novadx CEO Neil MacDonald said: "We are pleased that the Rosa mine and wash plant are beginning to operate at our commercial production target of 120,000 tons per year of clean coal. As we expected, our Rosa wash plant is producing a high quality product and we have recently negotiated higher contract prices for our coal in 2012. Accordingly, we anticipate our average selling price moving towards $180 per ton in this calendar quarter. We are continuing to look for ways to improve mine and wash plant efficiencies with the goal of exceeding our targets."
Novadx is a Vancouver-based mining investment company. Through its MCoal Corp. subsidiary, Novadx's primary focus is to invest its capital to acquire and develop companies with active or near production high quality coal reserves in Appalachia. MCoal operates the Rosa coal mine in Blount County, Ala., and is developing the Rex No.1 coal deep mine in Campbell County, Tenn.
Novadx said in a Dec. 28, 2011, financial filing that it anticipates the start of full-scale production at Rex No. 1 in the second calendar quarter of this year, with output of 20,000 tons per month once full production is achieved. Expansion could happen from there as the market dictates. The company said it intends to sell this coal into the silicon metal and other markets for prices of over $140/ton.
Notable is that as of July 2011, Novadx changed its presentation currency from Canadian dollars to U.S. dollars. The company also said in the Dec. 28 financial report that to better reflect its emphasis on coal operations, it plans to rename itself in fiscal 2012.