Published: March 8, 2022 |

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Montem Resources’ Tent Mountain Coal Mine in Alberta, Canada, has been designated as an advanced coal project by the Government of Alberta’s Coal Policy Committee.

As advanced coal projects are unaffected by the ministerial order resulting from the Coal Policy Committee’s recommendations, Montem’s project remains unaffected.

The Coal Policy Committee released its review of the Alberta 1976 Coal Development Policy on March 4, 2022, adding additional exploration and development restrictions.

FAVORABLE OUTCOME

“Montem had been waiting for the outcome, which has now proved favorable. We have reviewed the Coal Committee reports and recommendations, and the accompanying ministerial order. The Tent Mountain Mine remains unaffected by the policy update and has been recognized as an advanced project.,” Montem Managing Director and CEO Peter Doyle said.

“We will continue to work with regulators, First Nations, and all stakeholders to establish a suitable path for the mine re-start. The world is demanding responsibly sourced steelmaking raw materials, and the Tent Mountain Mine represents an important new source of high-quality steelmaking coal,” Doyle added.

“We look forward to finalizing the engineering design and economic analysis of TM-REX later this year and making an informed decision on which development pathway to pursue at Tent Mountain,” Doyle concluded.

TWO-TIER STRATEGY

Montem is advancing two parallel strategies for developing Tent Mountain:
• Restart of the existing coal mine
• Transition of the existing coal mine to a renewable energy complex (TM-REX). Work on TM-REX will continue
  for the remainder of the first half of 2022 until the economic analysis of TM-REX is available, at which point the
  investment potential of both development pathways can be compared

Montem will also continue to advance the existing coal mine restart through the federal and provincial permitting processes.

The Tent Mountain Mine last operated in 1983 and is in advanced stages of planning for the restart of operations.

Feasibility studies were completed and Montem has been optimizing the mine plan, water management systems, and closure plan to accompany various environmental studies as part of its environmental impact assessment (EIA).

A component of this closure plan includes a passive water management system supported by an end of mine life pump-hydro energy storage system.

Montem must undertake both federal (Impact Assessment Agency of Canada (IAAC), and provincial (AER) regulatory processes, both of which are well advanced.

The company is currently concentrating on completing the next step of the IAAC process, which is the detailed project description in which it will provide a high-level summary of issues gathered during the public review period.

The provincial AER permitting process is on hold while the IAAC process is undertaken.

TM-REX UPDATE

Montem has also been assessing the viability and economic potential of a renewable energy complex as it evaluates the transition of Tent Mountain to become a renewable energy complex.

Independent expert studies in 2019 and 2021 demonstrated the project’s strong viability to host a renewable energy complex which will include:
• 320 MW pumped hydro energy storage (PHES)
• 100 MW green hydrogen electrolyser
• 100 MW wind farm (offsite)

Tent Mountain has inherent advantages for hosting a large renewable energy complex, including repurposing existing assets which include a 300-meter drop (or average hydraulic head) between two large water reservoirs that were formed during previous mining operations.

The site is near Alberta’s high voltage electricity grid, has great existing infrastructure to support development, is adjacent to rail, gas pipelines, and the interprovincial highway 3, and sufficient space to develop a green hydrogen plant.

Montem is also working closely with the Piikani Nation (Piikani) on wind power generation strategies.

Tent Mountain is in the traditional territory of Piikani, and Piikani’s reserve lands are in the center of southern Alberta’s major wind power generating region.

Montem has engaged Hatch to complete detailed design and engineering work for the Tent Mountain PHES, which will be followed by field geotechnical investigation work planned to start in the Canadian summer of 2022.

These are both key steps in de-risking the project and moving it toward commercialization.

Further to this, Montem is working through the Alberta Electric System Operator stage-gate process to establish a connection to the Alberta electricity transmission system and is progressing design and cost estimates for the green hydrogen element of the TMREX.

These workstreams will provide project economics for the green hydrogen electrolyser.

COAL REQUIREMENTS CHANGING

The committee’s recommendation was good news for Montem, particularly at a time when the world is not only recovering from the crippling COVID-19 pandemic, but also looking for alternative, ethical supply.

Steel demand is robust and steelmakers continue to report strong margins despite higher than usual raw material costs.

Over the past six months, coal prices have reached unprecedented levels, up to 50 percent higher than previous record prices on the back of the pandemic, as well as Russia’s invasion of Ukraine. The invasion has pushed steelmaking coal prices to unprecedented highs.

Asian and European buyers are now embargoing Russian steelmaking coal imports and increasingly seeking ethically produced raw materials.

The pricing basis of the 2020 Tent Mountain Mine feasibility study was long-term forecast premium hard coking coal (HCC) price of US$150/tonne (FOB, Qld), and discounted 13 percent for the Tier 2 HCC product to be produced at Tent Mountain.

Alberta has tremendous potential to be a safe, environmentally responsible producer of steelmaking coal for the world and Montem’s Tent Mountain Mine represents an important source of new, responsibly mined and ethically sourced steelmaking coal.

Source: Proactive Investors

About Montem Resources
Montem Resources Ltd. is a steelmaking coal development company that owns and leases coal tenements in the Canadian provinces of Alberta and British Columbia. The company’s objective is to become the operator of steelmaking coal mines in Canada by developing its properties in the Crowsnest Pass. Montem is also progressing the Chinook Project, which covers historical mines that previously exported hard coking coal to Japanese steel mills and the project has the potential to produce multiple open-cut hard coking coal mines.

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