Coronado Global Resources Inc. Form 10-K December 31,
2022
89
(1)
Pricing for resources is described in Section 11.3.1 of the Logan TRS.
For Logan resources as of December 31, 2021, based on
assumed long-term average price of $130 per
ton (FOB loadout) for underground-mineable
resources, representing the long-term
average price
forecast for
HVB provided
by Coronado;
surface resources
were assessed
at a
sales price
of $52
per Mt
(FOB
loadout) based on estimated historical
pricing for Coronado’s surface operations.
For Logan resources as of December
31, 2022,
based on assumed long-term average price of $154 per Mt (FOB loadout) for underground-mineable resources, representing the
long-term average price forecast for HVB provided by Coronado; surface resources were assessed at a sales price of $83 per Mt
(FOB loadout) based on estimated historical pricing
for Coronado’s surface operations.
(2)
Exclusive of reserve tons.
Table 1-1 of the Logan TRS provides a summary of Logan
resource tons inclusive of reserve tons
as of
December 31, 2022.
(3)
Reported on a dry basis.
Surface moisture and inherent moisture are excluded.
(4)
Some numerical figures in the
above table have been subject
to rounding adjustments. Accordingly,
numerical figures shown as
totals may not equal the sum of the figures that
precede them.
Table 9.
Logan – Summary of
Coal Reserves (Marketable Sales
Basis) at the End
of the Fiscal Year Ended December
31, 2022 and 2021.
(1)
Demonstrated Coal Reserves (Wet
Tons,
Washed or Direct Shipped, MMt)
(2)
Quality (Air-Dried Basis)
Proven
Probable
Total
Ash
Sulfur
Volatile
Matter
December 31, 2022
53
17
71
8.0%
0.9%
36.0%
December 31, 2021
53
20
74
8.0%
0.9%
35.0%
(1)
Pricing data as
provided by Coronado is
described in Section
16.2 of the
Logan TRS.
For Logan reserves
as of December
31,
2021, the
pricing data
assumes respective
HVA,
HVB, specialty
markets and
thermal FOB-mine
prices of
approximately $224,
$123, and $51 per Mt for calendar year 2022; HVA, HVB, and thermal prices decrease to approximately $145, $115, and $51 per
Mt, respectively, through year 2026,
and then increase
to $227, $189, and
$51 per Mt,
respectively, through year 2050 (after
which
sales prices were held constant). For
Logan reserves as of December 31,
2022, the pricing data assumes
respective HVA, HVB
and thermal FOB-mine
prices of approximately
$192, $170, and
$227 per Mt
for calendar
year 2023; HVA, HVB,
and thermal prices
decrease to approximately
$151, $132, and
$83 per Mt,
respectively, through
year 2027, and
then increase to
$271, $237, and
$150 per Mt, respectively, through year 2056.
(2)
Reported on a 4.5% - 6.0% moisture basis.
(3)
Some numerical figures in the
above table have been subject
to rounding adjustments. Accordingly,
numerical figures shown as
totals may not equal the sum of the figures that
precede them.
From December 31, 2021 to December 31, 2022, total reserves decreased by approximately 3.9%, from approximately 73.5
MMt to 70.6
MMt.
This net reduction
of 2.9 MMt
of total reserves
was attributable to
a combination of
updates to the
mine
plans along
with one year
of mining
depletion. A
TRS with
respect to
Logan, updating
the TRS
with respect
to Logan
filed
with Coronado’s Annual
Report on Form
10-K for the
year ended December
31, 2021, was
prepared in February
2023 due
to
material
differences
in
the
key
financial
modifying
factors
including
coal
sales
price
assumptions,
operating
costs
and
capital costs from
December 31, 2021,
to December 31,
2022. Coal sales
price assumptions underlying
the reserve estimates
are discussed in Sections
12 and 16 of the
Logan TRS, while operating
costs and capital costs
assumptions underlying the
reserve estimates
are discussed
in Sections
18 and
19 of
the Logan
TRS.
The differences
in the
key financial
modifying
factors
did
not
have
a
material
impact
on
the
reserve
estimates
as
of
December
31,
2022,
as
compared
to
the
reserve
estimates as of
December 31, 2021.
From December 31,
2021, to December
31, 2022, measured
and indicated resources
decreased by approximately 0.7%,
from approximately 82.8 MMt
to 82.2 MMt. This
net reduction of 0.6
MMt of measured
and
mineral resources
was attributable
to one
year of
mining depletion
along with
changes to the
mine plan.
Updated financial
inputs, including coal sales price assumptions and
operating and capital costs used in estimating
the resources exclusive of
reserves, as discussed
in Section 11.3.1
of the Logan
TRS, did not
have a material
impact on the
measured and indicated
resource
estimates
as
of
December
31,
2022,
as
compared
to
the
measured
and
indicated
resource
estimates
as
of
December 31, 2021.
Marshall Miller & Associates, Inc., a third-party firm comprising mining experts,
whom we refer to as the U.S. QPs, prepared
the estimates of
coal resources
and reserves as of
December 31, 2022 summarized
in Tables
8 and 9.
A copy of the
U.S.
QPs’ TRS with respect to Logan, dated as
of February 15, 2023, or the Logan TRS,
is filed as Exhibit 96.3 hereto. The
U.S.
QPs are not affiliated with Coronado.
The
U.S.
QPs
prepared
the
estimates
of
coal
resources
and
reserves
using
core
drilling
data
available
from
exploration
activities at Logan conducted
by numerous entities over
time.
Most of this information
was obtained prior to
our acquisition
of the
property,
using varying drilling
and core-logging
techniques, survey methods
and testing procedures.
As a result,
in
verifying the data,
the U.S. QPs
made certain assumptions
about the adequacy
of the processes
performed and comparability
of
the
data
based
on
their
professional
experience
and
familiarity
with
Logan.
Per
Section
12.1
of
the
Logan
TRS,
coal
reserves were
classified as
proven or
probable considering
“modifying factors,”
including mining,
metallurgical, economic,
marketing, legal, environmental, social
and governmental factors.
Section 22.2 of the
Logan TRS includes a
risk assessment
of
the
key
modifying
factors
that
could
potentially
impact the
operations
and
therefore
the
estimate
of
coal
reserves
and
resources.