American Resources Corporation's American Carbon Corporation Completes Strategic Acquisition of 51% Interest in Iron Ore and Titanium Assets

Rhea-AI Summary

American Carbon Corporation, a subsidiary of American Resources Corporation (NASDAQ:AREC), has acquired a 51% ownership interest in a mineral asset with a focus on iron ore, titanium, and vanadium, representing an initial estimated deposit of 212.9 million tons of raw feedstock. The acquisition value is approximately $19.3 million, with exclusive offtake rights for 6% of American Carbon. The asset contains both onshore and offshore reserves off the southern shore of Jamaica. The initial reserve analysis indicates significant potential for high-value assets in the iron ore and titanium markets, making it a world-class asset. The acquisition positions American Carbon as a strategic player in the global supply chain for high-value raw materials and refined minerals.

Insights

Market Research Analyst

The acquisition of a 51% ownership stake in TR Mining by American Carbon Corporation, with its sizable estimated reserve of over 212.9 million tons of raw feedstock, is a strategic move that could significantly bolster American Carbon's position in the metallurgical and specialty carbon markets. The emphasis on diversification, particularly in iron ore, titanium and vanadium, aligns with current market demands for these materials in various industries, including aerospace, defense and construction.

From a market perspective, the exclusive offtake rights secured by American Carbon Corporation ensure a steady supply of critical minerals, which could provide a competitive edge in price negotiations and long-term supply agreements. This move is also timely, as the global economy continues to focus on infrastructure development and expansion, potentially increasing the demand for steel and associated raw materials.

Environmental Analyst

The commitment to employing 'highly environmentally sensitive technologies' for mineral concentration and processing is noteworthy, especially as the industry faces increased scrutiny regarding its environmental impact. This approach could not only reduce operational costs but also enhance the company's reputation and compliance with environmental regulations. The location of the reserves off the southern shore of Jamaica, away from residential areas, minimizes potential social and environmental conflicts, which is a positive aspect for stakeholders concerned with sustainable practices.

Financial Analyst

The acquisition value of approximately $19.3 million, paid through the issuance of equity, reflects a significant investment by American Carbon Corporation. Investors and shareholders will likely scrutinize the initial reserve analysis and third-party evaluations to assess the potential return on investment. The reported range of iron content in the black sand resource suggests variability that could impact the economic viability of the deposits. The financial implications of this acquisition will depend on the accuracy of the reserve estimates, the efficiency of the extraction and processing operations and the prevailing market prices for the minerals involved.

Jamaican-based resource deposit further establishes American Carbon's foothold in the steelmaking supply chain for infrastructure development and expansion

Acquisition of mineral deposit and exclusive offtake rights for six percent of American Carbon establishes an acquisition value of approximately $19.3 million

Initial reserve analysis represents over 212.9 million tons of total feedstock deposits

FISHERS, IN / ACCESSWIRE / February 7, 2024 / American Resources Corporation's (NASDAQ:AREC) ("American Resources" or the "Company") subsidiary American Carbon Corporation ("American Carbon"), an owner and operator of low-cost, high-quality metallurgical and specialty carbon assets, has acquired a 51% ownership interest in a diversified mineral asset with a focus on iron ore, titanium and vanadium with an initial estimated deposit of 212,925,000 tons of raw feedstock with an estimated 106,462,500 tons of ore body, based on an average of 50% magnetic material.

Tarlis Thompson, Chief Executive Officer of American Carbon Corporation, emphasized the importance and expansion into the broader supply chain for infrastructure and steel inputs stated, "This project is a diversified and high-quality asset that our team and colleagues have worked on for over a year to evaluate the market need and importance for high value assets in the iron ore and titanium markets. We believe the initial reserve analysis that has been completed and the assays of the material potentially make this a world class asset for iron ore, titanium as well as the potential for other critical and strategic elements. We are excited to work with our local partners as we further expand the reserve evaluation, mine plan, permitting and operational game plan to work with the local community utilizing low cost, highly environmentally sensitive technologies for mineral concentration and processing in the future."

Mark Jensen, CEO of American Resources Corporation added, "We currently sit at a very strategic and unique position within the global supply chain of high value raw materials and refined, technical-grade minerals. Our unique asset base, operational expertise, entrepreneurial foresight and nimble, low cost structure has enabled us to provide, what we think are, the most efficient and meaningful solutions in a highly-competitive, and geopolitical mineral supply chain for commercial and national security applications. Our innovative solutions position us to bring attractive and sought after value for stakeholders, our shareholders and partners alike. We will continue to aggressively work to deploy our value-added solutions and broaden our resource base along the way."

American Carbon Corporation acquired its 51% ownership stake of TR Mining and Equipment Limited ("TR Mining") (including equipment, leases, permits etc.) with 100% offtake rights to mineral feedstock located within the Special Exclusive Prospecting License No. 611, or any successor permit. The total consideration for the 51% ownership interest and offtake rights is the issuance of approximately 6% of the equity of American Carbon Corporation to the owners of TR Mining equating to a total equity consideration of approximately $19.305 million.

The initial assessment and laboratory results from the magnetite and titanomagnetite indicate the black sand resource typically range from 9% to 57% in surface iron content. The asset base contains both onshore and offshore reserves off the southern shore of Jamacia outside of any residential regions of the island. The minerals identified though the initial assessment included titanomagnetite, magnetite, hematite, ilmenite, plagioclase, quartz, epidote, olivine, augite, hornblende, apatite, calcite, garnet, hypersthene, rutile, zircon, etc. Third-party analysis and reserve report evaluation were conducted by the Geological and Geographical Solutions field team, Ja-GeoS, and commissioned by T.R. Mining and Equipment Limited.

About American Carbon Corporation
American Carbon Corporation is a raw material supplier to the infrastructure marketplace with a focus on metallurgical carbon, iron ore and titanium. Current operations are primarily focused on the extraction, processing, transportation, and distribution of coal for a variety of industries, with a primary focus on metallurgical quality coal to the steel industry. We have six coal mining and processing operating subsidiaries in the metallurgical carbon industry located in Eastern Kentucky and West Virginia along with a substantial iron ore and titanium asset base in the mining region of Jamaica. For more information visit americancarboncorp.com or connect with the Company on Facebook, Twitter, and LinkedIn.

About American Resources Corporation
American Resources Corporation (NASDAQ: AREC) is a next-generation, environmentally and socially responsible supplier of high-quality raw materials to the new infrastructure market. The Company is focused on the extraction and processing of metallurgical carbon, an essential ingredient used in steelmaking, critical and rare earth minerals for the electrification market, and reprocessed metal to be recycled. American Resources has a growing portfolio of operations located in the Central Appalachian basin of eastern Kentucky and southern West Virginia where premium quality metallurgical carbon and rare earth mineral deposits are concentrated.

American Resources has established a nimble, low-cost business model centered on growth, which provides a significant opportunity to scale its portfolio of assets to meet the growing global infrastructure and electrification markets while also continuing to acquire operations and significantly reduce their legacy industry risks. Its streamlined and efficient operations are able to maximize margins while reducing costs. For more information visit americanresourcescorp.com or connect with the Company on Facebook, Twitter, and LinkedIn.

Special Note Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks, uncertainties, and other important factors that could cause the Company's actual results, performance, or achievements or industry results to differ materially from any future results, performance, or achievements expressed or implied by these forward-looking statements. These statements are subject to a number of risks and uncertainties, many of which are beyond American Resources Corporation's control. The words "believes", "may", "will", "should", "would", "could", "continue", "seeks", "anticipates", "plans", "expects", "intends", "estimates", or similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Any forward-looking statements included in this press release are made only as of the date of this release. The Company does not undertake any obligation to update or supplement any forward-looking statements to reflect subsequent events or circumstances. The Company cannot assure you that the projected results or events will be achieved.

Investor Contact:
JTC Team, LLC
Jenene Thomas
833-475-8247
arec@jtcir.com

RedChip Companies Inc.
Robert Foley
1-800-RED-CHIP (733-2447)
Info@redchip.com

Company Contact:
Mark LaVerghetta
Vice President of Corporate Finance and Communications
317-855-9926 ext. 0
investor@americanresourcescorp.com

SOURCE: American Resources Corporation

View the original press release on accesswire.com

FAQ

What is the ticker symbol for American Resources Corporation?

The ticker symbol for American Resources Corporation is AREC.

What is the acquisition value of the mineral deposit by American Carbon Corporation?

The acquisition value of the mineral deposit by American Carbon Corporation is approximately $19.3 million.

What percentage of ownership interest did American Carbon Corporation acquire in the mineral asset?

American Carbon Corporation acquired a 51% ownership interest in the mineral asset.

Where are the mineral reserves located?

The mineral reserves are located off the southern shore of Jamaica, outside of any residential regions of the island.

What type of minerals were identified in the initial assessment of the mineral deposit?

The initial assessment identified minerals including titanomagnetite, magnetite, hematite, ilmenite, plagioclase, quartz, and others.

Who conducted the reserve report evaluation for the mineral deposit?

The reserve report evaluation was conducted by the Geological and Geographical Solutions field team, Ja-GeoS, commissioned by T.R. Mining and Equipment Limited.