Peabody Obtains Option on Mongolian Coal Interests

Peabody Energy announced that it has obtained an option to purchase up to a 50% interest in a joint venture holding Polo Resources Ltd.’s coal and mineral interests in Mongolia. Polo’s Mongolian coal interests have potential resources of more than 1 billion metric tons (mt), with a majority of its coal licenses located in the South Gobi coal region. This region hosts some of the largest metallurgical and thermal coal resources in close proximity to China, with potential to also access the Russian and export markets. Polo also has an active mining operation in Mongolia, with more than 100 employees on-site, primarily supplying the domestic market.

Under the agreement, Peabody would also be granted warrants to enable the company to acquire an approximate 15% equity interest in Polo. The transaction is targeted to close during the first quarter of 2009, subject to the completion of Peabody’s due diligence review and other approvals. Polo is an emerging energy company focused on acquiring and developing advanced stage coal and uranium properties in Asia and Australia.

As featured in Womp 2009 Vol 02 -