L & L Energy, Inc. reported that the company has signed an agreement to finance coal operations at a mine in Colorado.
L & L Energy, Inc. has agreed to provide up to $3 million in funds to Bowie Resources LLC, which owns the Bowie mine in Paonia, Colorado. The company funded the first part of the loan, in the amount of $1 million, on November 23, 2010.
Bowie Resources LLC will pay interest at a rate of 9% per annum. In addition, L & L Energy, Inc. will also receive an option to buy 9% of Bowie Resources LLC at an undisclosed price. The Bowie Mine has been in operation since 1997, and produces high quality coal that is low in sulfur content. Historical production at the mine is between 4 million and 5.5 million tons annually.
L & L Energy, Inc. estimates that the Bowie Mine contains proved reserves of 25 million tons of coal, and potential reserves of 15 million tons of coal. The company’s largest contract is with the Tennessee Valley Authority, and calls for deliveries of 3 million tons annually.
For more information on the company, go to www.llenergyinc.com