July 21, 2011 / 12:38 PM / 7 years ago

UPDATE 1-Grande Cache Coal warns on FY sales volume

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July 21 (Reuters) - Canadian coal miner Grande Cache Coal Corp warned that sales volumes for the year would be at the low end of its forecast after first-quarter sales were hit by lower production at a mine and vessel delays at Westshore Terminals ports.

The Alberta-based metallurgical coal miner said sales volumes in the current quarter would be the lowest of the year as volumes at the No. 8 pit were hurt by tight mining conditions.

The initial stages of mining have also led to a higher proportion of oxidized coal, which is sold as thermal coal, the company said in a statement.

Grande Cache sold 0.39 million tonnes of coal in the three months ended June 30, of which 84 percent was met coal. It sold 0.45 million tonnes in the same period a year-ago.

The company blamed lower production on an equipment malfunction at Westshore Terminals in late June and the loading of two vessels being delayed until the first week of July.

The company’s No. 8 pit at the Smoky River Coalfield, which went into production in the summer of 2010, has been plagued by various problems.

However, the company received an amended mine permit and a new mine licence from Alberta regulators to start development of its new No. 12 South B2 underground mine.

Production form the mine, which has an estimated resource base of 12.3 million tonnes, is expected to start during the third quarter.

Shares of the company closed at C$9.35 on Wednesday on the Toronto Stock Exchange. (Reporting by Savio D’Souza in Bangalore; Editing by Don Sebastian)

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