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Item 2. Properties

2024-03-14 compared with 2023-03-14 · 58 added, 67 removed, 248 unchanged (34% of the section changed)

Summary Overview of Mining Operations

Information concerning our mining properties in this Annual Report has been prepared in accordance with the requirements of subpart 1300 of Regulation S-K, which requires us to disclose our mineral resources, in addition to our mineral reserves, as of the end of our most recently completed fiscal year both in the aggregate and for each of our individually material mining properties.

As used in this Annual Report, the terms “mineral resource,” “measured mineral resource,” “indicated mineral resource,” “inferred mineral resource,” “mineral reserve,” “proven mineral reserve” and “probable mineral reserve” are defined and used in accordance with subpart 1300 of Regulation S-K.

Under subpart 1300 of Regulation S-K, mineral resources may not be classified as “mineral reserves” unless the determination has been made by a qualified person that the indicated and measured mineral resources can be the basis of an economically viable project.

You are specifically cautioned not to assume that any part or all of the mineral resources will ever be converted into mineral reserves, as defined by the SEC.

See “Item 1A “Risk Factors”

You are cautioned that, except for that portion of mineral resources classified as mineral reserves, mineral resources do not have demonstrated economic value.

Inferred mineral resources are estimates based on limited geological evidence and sampling and have a too high of a degree of uncertainty as to their existence to apply relevant technical and economic factors likely to influence the prospects of economic extraction in a manner useful for evaluation of economic viability.

Estimates of inferred mineral resources may not be converted to a mineral reserve.

It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category.

A significant amount of exploration must be completed in order to determine whether an inferred mineral resource may be upgraded to a higher category.

Therefore, you are cautioned not to assume that all or any part of an inferred mineral resource exists, that it can be the basis of an economically viable project, or that it will ever be upgraded to a higher category.

Likewise, you are cautioned not to assume that all or any part of measured or indicated mineral resources will ever be converted to mineral reserves.

See “Item 1A “Risk Factors”

The information that follows relating to the Elk Creek Complex, Berwind Complex, and Knox Creek Complex is derived, for the most part, from, and in some instances is an extract from, the technical report summaries (“TRS”) relating to such properties prepared in compliance with the Item 601(b)(96) and subpart 1300 of Regulation S-K.

Portions of the following information are based on assumptions, qualifications and procedures that are not fully described herein.

Reference should be made to the full text of the TRS’s, incorporated herein by reference and made a part of this Annual Report.

The following map shows the location of our mining properties and offices, excluding our property near Sheridan, Wyoming, as of December 31, 2022:

At December 31, 2022, we had four mining properties, as summarized in the table below (tons produced in 000s), excluding the Brook Mine property being used to support the Company’s CORE initiatives:

Item 2 Properties, Figure 1 below shows the location of our mining properties and offices as of December 31, 2023:

At December 31, 2023, we had five mining properties, as summarized in the table below (tons produced in 000s), excluding the Brook Mine property:

Processing Facilities -

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Knox Creek Preparation Plant - Truck, Norfolk Southern RR

Maben Complex

Wyoming and Raleigh Counties, WV

Underground, Highwall, Surface

Berwind Preparation Plant - Truck, Norfolk Southern RR

Washington County, PA

Commercial Development or Other

High Volatile C

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3.2 million tons for fiscal year 2023, 2.7 million tons for fiscal year 2022, and 2.2 million tons for fiscal year 2021.

Our preparation plants and loadout facilities

are located on properties owned by us or held under leases which expire at varying dates over the next 30 years.

Our preparation plants and loadout facilities are located on properties owned by us or held under leases which expire at varying dates over the next 30 years.

Most of the leases contain options to renew.

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In addition, the Company owns office space in Charleston, West Virginia that serves as an operations center.

The Company also owns offices in Sheridan, Wyoming as part of its CORE initiatives.

The Company also owns offices in Sheridan, Wyoming.

“Business - Our Projects” for additional information about our mining operations and CORE initiatives.

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A majority of the underground mines implement retreat mining, which results in mining recovery of greater than 80 percent.

Contour mining has an average mining recovery of approximately 90 percent, and the highwall mines have and average mining recovery of approximately 40 percent.

Contour mining has an average mining recovery of approximately 90 percent, and the highwall mines have an average mining recovery of approximately 40 percent.

The Elk Creek Complex is mining several seams and seam splits, including the Chilton A, Upper Dorothy, Upper Dorothy 2, 3, and 4, Middle Dorothy, Lower Dorothy, Upper Cedar Grove, Lower Cedar Grove A, Lower Cedar Grove B, Lower Cedar Grove C, Upper Alma, Lower Alma, Powellton, Eagle, and No.

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● Michael Powellton Deep Mine;

● Crucible Lower Cedar Grove B and C seams.

● Crucible Deep Mine Lower Cedar Grove B and C seams

There are three planned and permitted mines within the complex:

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2 Surface and Highwall Mine (which is the extension of Ram No.

1 above), scheduled for 2023 startup;

● Glenalum Tunnel #1 Deep Mine, scheduled for 2027 startup.

There is one permitted inactive mine, the Eight-Kay Deep Mine that is projected to start in 2027 and the Bens Creek Deep Mine is planned but is not yet permitted.

1 above), scheduled for late 2024 startup;

● Glen Alum Tunnel #1 Deep Mine, scheduled for 2027 startup.

There are two permitted inactive mines, the Eight-Kay Deep Mine that is projected to start in 2027 as well as the Monarch Deep Mine that is scheduled to start in 2026.

The Bens Creek Deep Mine is planned but is not yet permitted.

The projected startup date for this mine is 2028.

It is likely future mines will be planned and scheduled, as necessary, from resource areas within the complex, to meet internal Ramaco production goals aligned with market conditions.

With the exception of the Ram No.

3 mine, all planned mines are subject to future Board approval.

The current Elk Creek Complex Life-of-Mine (“LOM”) Plan projects mining through 2040;

an expected mine life for the complex of 17 years.

The Company projects total annual mine production to range from 2.1 to 2.3 million clean tons in 2023.

All Run-of-Mine (“ROM”) coal is washed at the Elk Creek Preparation Plant.

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During 2022, we began work on a throughput upgrade at our Elk Creek Preparation plant.

We expect this upgrade will raise the nameplate processing capacity to 1,150 raw tons per hour and our annual processing capacity from this complex to approximately 3.0 million tons per year.

We expect that this upgrade will be completed in the second quarter of 2023.

In order to meet this increased capacity, we also began development work on additional low-cost, high- volatile underground and surface mines at Elk Creek.

These mines began production during the second quarter of 2022 and are expected to reach full levels of productivity during 2023.

Production is expected to increase at Elk Creek commensurate with the increase in processing capacity discussed above.

The book value of the Elk Creek Complex property and its associated plant and equipment was $264 million as of December 31, 2022.

We completed the expansion in 2023, which raised the nameplate processing capacity to 1,050 raw tons per hour and our annual processing capacity from this complex to approximately three million tons per year.

We also began development work on additional low-cost, high-volatile underground and surface mines at Elk Creek.

These mines began production during the second quarter of 2022 and reached full levels of productivity during 2023.

Production increased at Elk Creek during 2023 commensurate with the increase in processing capacity discussed above.

The gross book value of the Elk Creek Complex property and its associated plant and equipment was $269 million as of December 31, 2023.

The Elk Creek Complex utilizes industry standard, modern surface and underground mining equipment, processing equipment and infrastructure that is in good operating condition and capable of meeting planned production requirements using prudent operating methods and operating schedules.

The Elk Creek Complex produces a high quality, high-volatile metallurgical coal.

The Elk Creek Complex produces high-quality, high-volatile metallurgical coal.

Historically, the market for metallurgical coal from the Elk Creek Complex has been domestic metallurgical coal consumers and the global seaborne metallurgical coal market.

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The Berwind Complex is within the Southwestern Virginia and Southern West Virginia coal fields of the CAPP Region of the United States.

The Berwind Complex and surrounding area has an extensive history of coal mining, primarily by underground mining methods.

The Berwind Complex and surrounding area have an extensive history of coal mining, primarily by underground mining methods.

Mining within the Berwind/Knox Creek Complex likely began in the early-1900s and there have been many different mine operators both large and small in the region since then.

The Berwind Property consists of approximately 62,500 acres of leased coal holdings located in McDowell County, West Virginia and Buchanan and Tazewell Counties, Virginia.

Ramaco obtained their initial lease for this property in 2015 and commenced mine operations in 2017.

The Berwind Complex is in the production stage and currently has three active mines, one mine that was idle at December 31, 2022 and subsequently reactivated in the first quarter of 2023, and one permitted mine.

The three mines that were active at December 31, 2022 include one contour surface mine developing areas for a highwall miner, and two underground room and pillar mines, which use continuous miners for mine development.

Ramaco started operations at the Berwind Pocahontas 4 Deep Mine in 2017 and idled the mine in mid-July 2022 due to an ignition that an investigation by the Mine Safety and Health Administration (MSHA) suggests was caused by lightning that struck a pilot hole for a new shaft.

Ramaco obtained its initial lease for this property in 2015 and commenced mine operations in 2017.

The Berwind Complex is in the production stage and currently has three active mines.

The three mines that were active at December 31, 2023 are underground room and pillar mines, which use continuous miners for mine development.

caused by lightning that struck a pilot hole for a new shaft.

Production at the Berwind No.

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● Laurel Fork Pocahontas 3 Deep Mine

● Triple S Surface and Highwall Mine

● Berwind No.

1 Pocahontas 4 Deep Mine (idle at December 31, 2022 but reactivated in the first quarter of 2023)

1 Pocahontas 4 Deep Mine

Permitted Mines:

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The current Berwind Complex Life-of-Mine (LOM) Plan projects mining through 2049, an expected mine life for the complex of 20+ years.

Ramaco projects total annual production to be approximately 0.9 million clean tons until another super-section is started in the Berwind No.

1 Deep Mine in 2027, and average 1.2 million clean tons per year through 2040 when the Berwind No.

1 Deep Mine is nearing end of mine life.

After this, the single-section Laurel Fork Deep Mine is currently planned to operate into 2049 at an average annual rate of approximately 307 thousand clean tons per year.

However, it is likely future mines will be planned and scheduled, as necessary, from resource areas within the complex, to meet internal Ramaco production goals aligned with market conditions.

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Ramaco refurbished the preparation plant in 2021 and 2022 based on a design by Ramsey Industrial, with a current ROM processing capacity of 600 tons per hour.

The book value of the Berwind Complex property and its associated plant and equipment is $148 million as of December 31, 2022.

The gross book value of the Berwind Complex property and its associated plant and equipment was $155 million as of December 31, 2023.

The Berwind Complex utilizes industry standard, modern surface and underground mining equipment, processing equipment and infrastructure that is in good operating condition and capable of meeting planned production requirements using prudent operating methods and operating schedules.

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The Knox Creek Complex is within the Southwestern Virginia and Southern West Virginia coal fields of the CAPP Region of the United States.

The Knox Creek Complex and surrounding area has an extensive history of coal mining, primarily by underground mining methods.

The Knox Creek Complex and surrounding area have an extensive history of coal mining, primarily by underground mining methods.

Mining within the Knox Creek Complex likely began in the early-1900s and there have been many different mine operators both large and small in the region since then.

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It is anticipated that future mines will be planned and scheduled, as necessary, from resource areas within the complex, to meet internal Ramaco production goals aligned with market conditions.

Both planned mines listed above are subject to future Board approval.

All Run-of-Mine (ROM) coal is washed at the Knox Creek Preparation Plant.

The Knox Creek Preparation Plant, built in 1981 by Powell Construction Company located in Johnson City, Tennessee, is a well designed and constructed preparation plant, with ROM processing capacity of 750 tons per hour.

The book value of the Knox Creek Complex property and its associated plant and equipment is $31 million as of December 31, 2022.

The gross book value of the Knox Creek Complex property and its associated plant and equipment was $47 million as of December 31, 2023.

The Knox Creek Complex utilizes industry standard, modern surface and underground mining equipment, processing equipment and infrastructure that is in good operating condition and capable of meeting planned production requirements using prudent operating methods and operating schedules.

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We are unaware of any significant encumbrances to the Knox Creek Complex, including current and future permitting requirements and associated timelines, permit conditions, and violations and fines.

Other Properties

Refer to the discussion of our Maben Complex and our RAM Mine under Item 1.

“Business - Our Projects” for information about these properties, which are not included in the disclosures of mineral resources and reserves at December 31, 2023 to follow.

Additional information regarding the acquisition of Maben can be found in Part II, Item 8, Note 4 of this report.

Summary of Mineral Resources and Reserves

Summaries of our mineral resources and reserves at December 31, 2022, are set forth in Tables 1 and 2.

Summary Mineral Resources at end of Fiscal Year ended December 31, 2022

Summaries of mineral resources and reserves at our material properties as of December 31, 2023, are set forth in Tables 1 and 2.

Summary of Mineral Resources at the end of Fiscal Year ended December 31, 2023

Measured Mineral Resources

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2 Alma Deep Mine

Michael Powellton Mine

Rockhouse Eagle Deep Mine

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Lower War Eagle

Glenalum Tunnel #1 Deep Mine

Glen Alum Tunnel #1 Deep Mine

Gilbert Deep Mine

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Mineral Resources reported here are exclusive of Mineral Reserves.

● Resource probable economic mineability is based on underground minable resources with 2.0 feet minimum seam thickness, surface and highwall mines with 1.0 feet minimum seam thickness, area mining with a cutoff stripping ratio of 20:1, and primarily metallurgical low and mid-volatile coal at the Berwind Complex realizing a sales price of $169 per ton at a cash cost of $101 per clean ton (FOB Mine), primarily metallurgical mid and high-volatile at the Knox Creek Complex realizing a sales price of $184 per ton and cash cost of $99 per clean ton (FOB Mine), and primarily metallurgical high-volatile A and high-volatile B coal at the Elk Creek Complex realizing a sales price of $131 per ton at a cash cost of $77 per clean ton (FOB Mine).

● Numbers in the table have been rounded to reflect the accuracy of the estimate and may not sum due to rounding.

Summary Mineral Reserves at end of Fiscal Year ended December 31, 2022

Summary of Mineral Reserves at the end of Fiscal Year ended December 31, 2023

Proven Mineral Reserves

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Bens Creek Deep Mine

Glenalum Tunnel #1 Deep Mine

Glen Alum Tunnel #1 Deep Mine

● Clean recoverable reserve tonnage based on underground mining recovery of 50 to 80 percent (contingent upon retreat mining capability), 90 percent for surface mining, 40 percent for highwall mining, theoretical preparation plant yield, and a 95 percent preparation plant efficiency.

● Mineral Reserves estimated for the Berwind Complex are based primarily on metallurgical low and mid-volatile coal realizing a sales price of $169 per ton at a cash cost of $101 per clean ton (FOB Mine), primarily metallurgical mid and high-volatile coal at the Knox Creek Complex realizing a sales price of $184 per ton and cash cost of $99 per clean ton (FOB mine), and primarily a metallurgical high-volatile A and high-volatile B coal at the Elk Creek Complex realizing a sales price of $131 per ton at a cash cost of $77 per clean ton (FOB Mine).

● Numbers in the table have been rounded to reflect the accuracy of the estimate and may not sum due to rounding.

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Changes in mining methods or the utilization of new technologies may increase or decrease the recovery basis for a coal seam.

The most recent studies of our coal reserves for the Elk Creek Complex, Berwind Complex, Knox Creek Complex, and RAM Mine were prepared by an independent engineering firm,

Weir International, Inc.

In periods between third party updates, we update reserves utilizing our internal staff of engineers and geologists based upon production data.

The most recent studies of our coal reserves for the Elk Creek Complex, Berwind Complex, and Knox Creek Complex were prepared by an independent engineering firm, Weir International, Inc.

In periods between third party updates, we update reserves utilizing our internal staff of engineers and geologists based on production data.

We intend to continue to periodically retain outside experts to assist management with the verification of our estimates of our coal reserves going forward.

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Weir initiated this process with us by completing a historical project review as well as its validation of our complete drill hole database.

Weir validated that property control is accurately reflected in reserve modeling, verifying the latest property boundaries, including control by each individual seam.

Weir validated that property control is accurately reflected in reserve modeling, verifying the latest property boundaries, including control by each seam.

Weir also examined reserve boundaries to ensure agreement with mining parameters, such as minimum thickness, minimum yield and minimum inter-burden between seams.

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Weir served as the QP and prepared the estimates of mineral resources and mineral reserves at the Berwind Complex, Knox Creek Complex, and Elk Creek Complex.

A copy of the QP’s TRS with respect to the mineral resource and reserve estimates at the Berwind Complex, dated March 9, 2023, with an effective date of December 31, 2022 (the “Berwind TRS”), is filed as Exhibit 96.1, and at the Knox Creek Complex, dated March 9, 2023, with an effective date of December 31, 2022 (“Knox Creek TRS”), is filed as Exhibit 96.2.

Since a material change has not occurred from the last TRS filed for the Elk Creek Complex, the previous year’s TRS has not been updated.

Refer to Exhibit 96.3.

Since a material change has not occurred from the last TRS filed for each complex, the previous years’ TRSs have not been updated.

Refer to Exhibit 96.1, 96.2, and 96.3 for access to the previous TRS for the Berwind Complex, Knox Creek Complex, and Elk Creek Complex, respectively.

Year ended December 31,

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Estimates of coal reserves and resources are updated annually to reflect changes resulting from active mine production, mine plan modifications, property acquisitions/sales, impacts of additional exploration drilling, and any other changes that impact remaining coal reserve and resource tonnage.

The combined proven and probable reserves at the Berwind, Knox Creek and Elk Creek Complexes increased by 23 million tons, driven by 14 million tons resulting from property acquisitions within the Berwind Complex as well as the conversion of mineral resources to mineral reserves within the Knox Creek Complex.

Similarly, measured and indicated coal resources increased by 387 million tons, driven by 384 million tons resulting from property acquisitions within the Berwind Complex.

The combined proven and probable reserves at the Berwind, Knox Creek and Elk Creek complexes decreased by three million tons due to 2023 production.

Measured and indicated coal resources decreased by 37 million tons during 2023, approximately 25 million tons were due to property control changes (assignment of coal leases) at the Knox Creek Complex and 11 million tons were due to the permit denial at the RAM mine and our decision not to pursue an appeal.

Key assumptions and parameters relating to the mineral resources and mineral reserves are discussed in sections 11 and 12, respectively, of each TRS.

Exploration Target

Brook Mine is an exploration property that includes three drillhole programs involving a total of 123 new core drillholes.

Specifically, targeting REEs has been completed within the current Brook Mine permit area.

So far, the results of these drilling programs indicate elevated levels of REEs, along with significant concentrations of other critical elements such as Yttrium, Gallium, and Germanium.

Work is ongoing to evaluate the potential exploitation of these minerals within the current Brook Mine permit area.

There has been insufficient exploration of the Brook Mine to estimate a mineral resource and it is unclear, at present, whether further exploration will result in the estimation of a mineral resource.

The exploration target therefore does not represent, and should not be construed to be, an estimate of a mineral resource or mineral reserve as such terms are used in subpart 1300 of Regulation S-K.

Internal Controls

In our exploration and mineral resource and reserve estimation efforts, we utilize an American National Standards Institute certified third-party laboratory, which has in-house quality control and assurance procedures.

In our exploration and mineral resource and reserve estimation efforts, we utilize a certified American National Standards Institute third-party laboratory, which has in-house quality control and assurance procedures.

Once in possession of the samples, the laboratory standard sample preparation and security procedures are followed.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 2. Properties