Another coal mine is in the works for Hinton, Alberta

1 of 2This is an aerial view of the Vista Coal Project near Hinton, Alberta. — Photo courtesy Coalspur Mines Ltd.

2 of 2A map of Coalspur's flagship Vista coal project near Hinton, Alberta. — Photo courtesy Coalspur Mines Ltd.

Hinton, a community located in west central Alberta, is no stranger to mining. The town, according to Chris Borowski of Coalspur Mines, has supported coal mining operations for more than 100 years. There are currently four mines in operation in the area—and there will soon be a fifth.

Coalspur Mines, a coal development company focused on exporting its coal to the Asia/Pacific market (mainly Japan, South Korea and China) has big plans for a large thermal coal mine that could end up being one of North America's largest dedicated coal export operations. The Vista Coal Project is Coalspur's flagship mine.

"Coalspur is in a unique position as a development company, since we have our port allocation and rail transportation agreements secured well in advance of commencing production," said Borowski.

As of September 2012, the company had substantially progressed its applications with the regulatory authorities in Alberta for the first of two phases of Vista. Borowski said the Australian-based company—which has offices in Calgary, Hinton and Vancouver—expects approval in the first quarter of next year.

Once approved, Coalspur will commence construction of the mine in 2013, with first production beginning in 2015. Phase 1 will produce up to five million tonnes per annum (mtpa) and Phase 2 will increase production to 12 mtpa by 2018. The expected mine life of the Vista Coal Project is 28 years.

Borowski said the development cost to bring Vista to first production is about $870 million and the company is evaluating several initiatives to reduce that amount. These initiatives include an enhanced mine schedule—which will reduce the capital required during construction and the initial years of mining—and the utilization of mining contractors. Vista will be funded from proceeds received from a strategic partner, traditional debt financing and coal marketing arrangements.

"The management team at Coalspur has been involved in the commissioning and building of several coal projects in Alberta, so the regulatory process is very familiar to them," said Borowski. "We have been fully committed in public engagement and aboriginal consultation to keep stakeholders in the loop and to ensure that any issues can be resolved in a timely manner."

For the residents of Hinton and the surrounding area, the Vista Coal Project has the potential to create numerous jobs.

"Another great thing about the Hinton region is that there are about 20,000 people," said Borowski, "which provides a substantial base of potential skilled employees who are familiar with the mining industry. We continually receive job applications and resumés, which shows that there are many people in the area that want to work for Coalspur."

Borowski believes Hinton will be viewed as a desirable place that will attract future employees—when compared to other mining jurisdictions—due to its close proximity to the mountains, its emphasis on outdoor activities and its sense of community.