Canadian Mining Journal

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COAL: Morien receives first royalty payment from Donkin mine



NOVA SCOTIA – Morien Resources Corp. of Halifax has received the first royalty payment from Kameron Collieries (an affiliate of the Cline Group) for production from the Donkin metallurgical coal mine on Cape Breton. The payment was “nominal in value,” said Morien, but it does mark the start of coal sales to third parties.

The Donkin colliery is in production at long last. (Credit: Morien Resources)

Originally proposed for development by the long-defunct Cape Breton Development Corp., Donkin has gone through a number of owners in recent history – Xstrata, Erdene, Morien, Glencore, and now Kameron. The 2013 positive environmental decision paved the way for production. Morien gave up its 25% working interest in the project in 2014, retaining a royalty instead.

Morien owns a gross production royalty of 2% on the first 500,000 tonnes of coal sales per calendar quarter (excluding the initial 10,000 tonnes of coal produced and sold from Donkin) and 4% on any coal sales from quarterly tonnage above 500,000 tonnes. The royalty is payable to Morien on a quarterly basis over the anticipated 30 plus year mine life.

A snapshot of the Donkin project is posted at www.MorienRes.com/donkin-snapshot.