ST. LOUIS, Jan. 27 /PRNewswire-FirstCall/ -- Peabody Energy (NYSE: BTU)
today announced that it has obtained an option to purchase up to a 50 percent
interest in a joint venture holding Polo Resources Limited's (AIM: PRL) coal
and mineral interests in Mongolia.
Polo's Mongolian coal interests have potential resources of over 1
billion tonnes, with a majority of its coal licenses located in the South Gobi
coal region. This region hosts some of the largest metallurgical and thermal
coal resources in close proximity to China, with potential to also access the
Russian and export markets. Polo also has an active mining operation in
Mongolia, with over 100 employees on-site, primarily supplying the domestic
Under the agreement, Peabody would also be granted warrants to enable the
company to acquire an approximate 15 percent equity interest in Polo. The
transaction is targeted to close during the first quarter of 2009, subject to
the completion of Peabody's due diligence review and other approvals.
"A joint venture with Polo's existing platform will accelerate the
development of Peabody's presence in one of the world's premier undeveloped
coal regions," said Peabody Chairman and Chief Executive Officer Gregory H. Boyce.
"Because Polo has existing assets, coal resources and personnel in Mongolia,
this transaction advances our goal of expanding our presence in high-growth,
"Polo is excited about the opportunity to join forces with a company of
the calibre of Peabody," said Stephen R. Dattels, Polo's Chief Executive
Officer. "This alliance will provide the mining expertise and resources
required to develop our asset base and unlock the currently unrecognized value
of Polo's Mongolian interests."
Peabody is the world's largest private-sector coal company. Its coal
products fuel approximately 10 percent of all U.S. electricity generation and
2 percent of worldwide electricity.
Polo is an emerging energy company focused on acquiring and developing
advanced stage coal and uranium properties in Asia and Australia.
Certain statements in this press release are forward-looking as defined in
the Private Securities Litigation Reform Act of 1995. These forward-looking
statements are based on numerous assumptions that the company believes are
reasonable, but they are open to a wide range of uncertainties and business
risks that may cause actual results to differ materially from expectations as
of Jan. 27, 2009. These factors are difficult to accurately predict and may
be beyond the company's control. The company does not undertake to update its
forward-looking statements. Factors that could affect results include those
described in this press release as well as risks detailed in the company's
reports filed with the Securities and Exchange Commission.
SOURCE Peabody Energy