June 4, 2010 / 11:58 AM / in 7 years

UPDATE 1-Western Coal reopening Willow Creek mine

* Says mine reopening two months ahead of schedule

* Says increased mine reserves at site by 88 percent

TORONTO, June 4 (Reuters) - Western Coal WTN.TO said on Friday it is reopening its Willow Creek coal mine in British Columbia, as demand and pricing for metallurgical coal have strengthened significantly in recent months.

The mine, which was on care and maintenance status, is being reopened two months ahead of schedule, said Vancouver-based Western Coal, in a statement.

The company also announced an 88 percent increase in coal reserves at the site to 29.6 million tonnes. This will allow the company to potentially expand output from the site, while simultaneously extending Willow Creek’s mine life.

Western Coal expects to raise output at its mines in British Columbia to 6 million tonnes over the course of the next three years, from the current 2.2 million-tonne level.

The Willow Creek mine can currently produce about 900,000 tonnes of metallurgical coal annually. Western Coal said it has work under way to increase production by late 2011 to 1.7 million tonnes per year.

Metallurgical, or coking, coal is used to manufacture steel, and increased Chinese steel production has helped strengthen the price of the commodity following the global economic downturn. (Reporting by Euan Rocha, editing by Dave Zimmerman)

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