L&L Energy buys majority stake in Chinese coal mine
L&L Energy, Inc. (NASDAQ: LLEN), a Seattle-based company with five-year track record of profitable coal operations in China, announced today, consistent with its consolidation strategy, the entry into an MOU to acquire the Lashu Mine (the “Mine” or “Lashu”) in HeZhang County, Guizhou Province.
The MOU, for 51% controlling stake in the Mine, is entered with Union Energy, previous owner of L&L’s Weishe Mine, also in HeZhang County. The repeat transaction illustrates the confidence in the Company’s mining operations and enhances the reputation of the Company as consolidator of mining operations in the region.
Upon production, scheduled for fall 2012 and fully implemented within 2013, the Mine will produce low-sulfur, high BTU, anthracite coal at the approved annual production rate of 300,000 tons on 7.17 million tons of reserves, with potential expansion to 450,000 tons and beyond on reconnaissance resources of 20 million tons.
L&L will pay an earnest deposit of approximately $314,000 (RMB 2,000,000) and the remaining balance, which is being finalized, will be paid in installments over time in accordance with the definitive agreement. Both L&L and Union Energy stand to profit from the enhanced mining operations supervised by L&L’s professional team.
L&L’s Chairman and CEO, Dickson Lee, commented, “The acquisition of the Mine is part of our consolidation strategy in HeZhang County. We are working with Union Energy and others to identify further opportunities. We are organizing our mining assets in a focused manner, to maximize return to our shareholders. ”
L&L was incorporated in 1995 by the Company’s Chairman and CEO. The Company has grown from a single employee to more than a thousand over the past 17 years. L&L has entered an expansion phase, seeking to consolidate mines in China and expand its sphere of business operations. Using its U.S.-style quality assurance processes, the Company is upgrading its mining portfolio and expanding its distribution network for strategic revenue growth.