Acquiring capital funds for coal mining
Because of the unique mix of financial and technical risk in a mine project, the domestic coal industry requires a diverse selection of financial arrangements. Commercial banks, offering the widest variety of loans, are employed most often to meet this demand. Of the various arrangements offered by commercial banks, the term and project loans are selected most often. The wide use of these two programs is attributed to their adaptability in financing many different types of coal mining projects. Consequently, the mine operator has more available financing alternatives by dealing with a bank. In seeking capital financing, the coal mine operator then must deal with several problems. High interest rates and market uncertainty are the most pressing. Without some indication of future coal sales, lenders are hesitant to enter into a loan agreement. Lack of equity and high initial capital investment, largely due to government environmental regulations, further complicates the capital funding acquisition process.
- OSTI ID:
- 6068600
- Journal Information:
- Min. Eng. (Littleton, Colo.); (United States), Journal Name: Min. Eng. (Littleton, Colo.); (United States) Vol. 34:9; ISSN MIENA
- Country of Publication:
- United States
- Language:
- English
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