New coal-mine-development considerations in financing
Economic feasibility of a proposed coal mine must be established by the firm as the first step in developing a coal mine. The second step is determining the source of capital, equity, or debt. Determination of the amount of debt (i.e., loans) follows. Mining loans are generally utilized for an agreed upon, specified purpose. Initially, creditability of the borrower as an investor and/or operator must be satisfactory. The lender (bank) must be comfortable that capital assets and labor can be brought together to cohesively exploit the mineral reserves. Finally, there must be a market and transportation to reach that market. These considerations, when properly interrelated, will generate cash over a defined period of time. It is this cash flow that validates the project. Present values are determined, and these are then related to market values of the property. Upon satisfactory resolution of all of these considerations, a loan is made. 9 references, 2 figures, 2 tables.
- Research Organization:
- Security Pacific National Bank, Denver, CO
- OSTI ID:
- 6472879
- Journal Information:
- Min. Year Book; (United States), Journal Name: Min. Year Book; (United States); ISSN MYBOD
- Country of Publication:
- United States
- Language:
- English
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