ITOCHU Announces Investment in North Central Resources, LLC and its Longview Coking Coal Mine
December 25, 2019
ITOCHU Corporation (headquartered in Minato-ku, Tokyo; Yoshihisa Suzuki, President & COO; hereinafter “ITOCHU”) announced today that it has concluded a definitive agreement with US-based American Metals & Coal International, Inc. (hereinafter “AMCI”), South Korea-based POSCO, and US-based JAZ Ventures, L.P. (hereinafter “JAZ”) for the purpose of acquiring a 25% membership interest in North Central Resources, LLC (hereinafter “NCR”), owner of the Longview coking coal mine under development in West Virginia, USA. AMCI, POSCO and JAZ are existing members of NCR.
The Longview coking coal mine is currently being developed towards the commencement of full-scale production at the end of 2022. The total development cost is estimated at approximately 450 million U.S. dollars (approx. 49.5 billion yen). ITOCHU and other members will fund this cost as development progresses in proportion to its interests. The mine is expected to have an average annual production capacity of 4 million tons, and will be one of the largest coking coal mines in USA. It will produce high-quality coking coal with world-class cost competitiveness. For the purpose of marketing products, AMCI, JAZ and ITOCHU will establish a new company that will exclusively conduct worldwide sales and marketing activities.
Amid firm growth in global steel production, coking coal demand is expected to continue to increase in the future. With the new development of the Longview mine and its involvement in the marketing JV, ITOCHU will be contributing a stable supply of high quality metallurgical coal to global customers, particularly in Japan and Asia.
Outline of the Longview coking coal mine
| Ownership composition | AMCI 42.38% ITOCHU 25.00% POSCO 22.05% JAZ 10.58% |
|---|---|
| Location | Barbour County, West Virginia, USA |
| Coal type | Hard coking coal |
| Extraction method | Underground mining |
| Mining life | 30 years (Production scheduled to start at the end of 2022) |
| Production capacity | 4 million tons per year |