/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/ TORONTO, March 3 /CNW/ - (TSX:SCP) - Sprott Resource Corp. ("SRC") today announced that it has received a production forecast from PBS Coals, Inc. ("PBS Coals") for the years 2008 - 2010. With the injection of new capital from SRC and other investors (see Dec. 5, 2008 press release), PBS Coals has initiated a capital spending program which is expected to double its metallurgical coal production. PBS Coals expects to solidify contracts with its key customers, while also offering significant quantities for sale in the spot market. "We are pleased to see that the expansion of production is on track and on budget, and that PBS Coals appears to be on its way to ramping up production to become an annual producer of more than 4 million tons of low volatile metallurgical coal by 2010," said Kevin Bambrough, President and CEO of SRC. "PBS Coals believes it is amongst the lower cost producers of low volatile metallurgical coal in the U.S. With serious global supply issues persisting in the metallurgical coal market, we believe PBS Coals, a U.S. producer with low operating costs, to be uniquely positioned to achieve sustainable, high profit margins for years to come."Highlights of the capital program include: - Throughout 2008, PBS Coals plans to develop two new deep mines, Kimberly Run and Horning, and add a second continuous mining unit at its Roytown mine, as well as to ramp up production at its new Trent surface mine. - PBS Coals will upgrade the Shade Creek Coal Prep Plant in order to increase overall output and further improve product quality. - PBS Coals will also rebuild the existing Cambria Fuel Coal Prep Plant, which will allow PBS Coals to significantly increase its overall production capacity. Approvals have been received from the relevant authorities, which allows for the construction of the new plant complex. PBS Coals will then have a processing plant on each of the CSX and the Norfolk Southern rail lines, both of which offer access to the export piers, providing flexibility in serving its customers. - As part of the expansion program PBS Coals will be adding four new continuous miners and related ancillary mining equipment to the deep operations and on the surface mines refurbishing PBS Coals' 7820 Marion walking dragline and upgrading the shovel and truck capacity.In addition, Sithe Global has submitted an Air Quality Permit application for a 350-500 MW coal-fired power plant to be constructed adjacent to PBS Coals' Shade Creek Plant. PBS Coals intends to negotiate coal supply contracts and review the potential for equity participation in the project as it proceeds towards approval. The construction of this project would bring important environmental and financial benefits to PBS Coals and the surrounding communities. About Sprott Resource Corp. SRC is a Canadian based company, the primary purpose of which is to invest, directly and indirectly, in natural resources. Through acquisitions, joint ventures and other investments, SRC seeks to provide its shareholders with exposure to the natural resource sector for the purposes of capital appreciation and real wealth preservation. SRC is well positioned to draw upon the considerable experience and expertise of both its Board of Directors and Sprott Consulting Limited Partnership (SCLP), of which Sprott Asset Management Inc. is the sole limited partner. Pursuant to a management services agreement between SCLP and SRC, SCLP provides day-to-day business management for SRC as well as other management and administrative services. Forward Looking Statements Certain statements regarding SRC and its indirect investment in PBS Coals, including management's assessment of future plans, may constitute forward-looking statements under applicable securities laws. Forward-looking statements may include words such as "plans", "intends", "anticipates", "should", "estimates", "expects", "believes", "indicates", "suggests" and similar expressions. Forward-looking statements necessarily involve risk, including without limitation, risk associated with future commodity prices, foreign exchange rate fluctuation, government regulation relating to the production of coal, environmental risks, changes in laws, capital expenditure cost increases, increases in mining and energy costs and operational issues at mine sites. SRC's and PBS Coals' actual results or achievements could differ materially from those expressed in, or implied by, the forward-looking statements. No assurance can be given that any events anticipated by the forward-looking statements will occur. These forward-looking statements, which are based on management's current expectations, are made as at the date of this news release. SRC does not undertake any obligation to publicly update or revise any of these forward-looking statements, except as required by applicable securities laws.
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