ACQUISITION OF MAJORITY STAKE IN BUFFALO COAL

TORONTO, ONTARIO – Marketwired - June 15, 2022: Buffalo Coal Corp. announces on June 14, 2022, Belvedere Resources DMCC (“the Acquiror”) purchased from Resource Capital Fund V L.P. (the “Seller” and together with the Acquiror, the “Parties”) 347,945,097 Common Shares in the capital of the Issuer. The Acquiror also assumed a US$27 million convertible loan (the “Loan”) pursuant to a convertible loan agreement between the Seller and the Issuer. The Loan with a maturity date of 30 June 2023 is optionally convertible by the Acquiror into Common Shares in the capital of the Issuer at the conversion rate of CA$ 0.0469 per common share. The purchase of the Common Shares and the Loan are collectively referred to as the “Transaction” in this release. The Transaction took place by private agreement between the Parties.

The Acquiror purchased the 347,945,097 Common Shares at a price of US$ 0.001552 per Common Share, for an aggregate purchase price of US$540,000 C$689,958) and acquired the Loan for US$2,000,000 (C$2,555,400). The total consideration paid in connection with the Transaction was US$2,540,000 (C$3,245,358) (in each case determined using the daily average exchange rate of the Bank of Canada, of 1.2777 at June 10, 2022).

Prior to the completion of the Transaction, the Acquiror did not own any Common Shares of the Issuer. After purchasing the Common Shares and the Loan in connection with the Transaction, the Acquiror owns 82.58 percent of the issued and outstanding Common Shares of the Issuer on a partially diluted basis. The number of common shares to be issued on conversion of the Loan would depend on the prospective exchange rate between US$ and C$. For illustrative purpose, 735.563 million Common Shares would be issued on conversion at the daily average exchange rate of the Bank of Canada, of 1.2777 on June 10, 2022, if the conversion had taken place on that date, and fully diluted ownership would be 92.88 percent, comprising of 1,083.51 million common shares in total.

The Acquiror has acquired the Common Shares and will acquire the Common Shares underlying the Loan, if converted on or before the date of maturity of 30 June 2023, for investment purposes with active management participation. The Acquiror may, depending on price, market conditions or other conditions or factors it considers relevant from time to time, increase or decrease its beneficial ownership, control or direction over Common Shares or other securities of the Issuer through market transactions, private agreements or otherwise.

About Buffalo Coal

Buffalo is a coal producer in South Africa. It holds a majority interest in two operating mines through its 100% interest in Buffalo Coal Dundee, a South African company which has a 70% interest in Zinoju. Zinoju holds aBuffalo is a coal producer in South Africa. It holds a majority interest in two operating mines through its 100% interest in Buffalo Coal Dundee, a South African company which has a 70% interest in Zinoju. Zinoju holds a100% interest in the Magdalena bituminous mine, the Aviemore East anthracite mine and the Balgray and North Adit anthracite projects in South Africa. Buffalo Coal has an experienced coal-focused management team.

The Company has its primary listing on the TSX Venture Exchange and has a secondary listing on the Alternative Exchange, operated by the JSE Limited.

Forward-Looking Statements

This press release may contain forward looking information within the meaning of applicable securities legislation, which reflects the Company’s current expectations regarding future events. Forward-looking statements include, but are not limited to, statements with respect to: the completion of the Transaction, the assumption of the Loan by the Acquiror, and the ability or willingness of the Acquiror to acquire some or all of the Common Shares underlying the Loan. Forward looking information is based on a number of assumptions and is subject to a number of risks and uncertainties, many of which are beyond the Company’s control, which could cause actual results and events to differ materially from those that are disclosed in or implied by such forward looking information. The Company does not undertake any obligation to update such forward looking information, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.

Neither the TSX Venture Exchange, nor its regulation services provider (as that term is defined in the policies of the exchange), accepts responsibility for the adequacy or accuracy of this release.


FOR FURTHER INFORMATION PLEASE CONTACT:

Emma Oosthuizen
Chief Executive Officer
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Registered office:
Greytown Road
Industrial Area
Dundee
Kwazulu-Natal
3000

15 June 2022

 



AGM 2022 - Notice to shareholders

Notice of Annual General and Special Meeting....

Notice to shareholders 

RESOURCES AND RESERVES TECHNICAL REPORT

TORONTO, ONTARIO – Marketwired - April 8, 2022: Buffalo Coal Corp. announces that the Group has filed a Competent Person’s Report titled “Buffalo Coal Dundee Resources and Reserves Technical Report Update National Instrument 43-101” (the “2022 Technical Report”) dated April 4, 2022 for the Group’s Aviemore Mine’s (Aviemore East, Aviemore North and Balgray) Reserve Statement and Magdalena Colliery’s Reserve Statement as at January 1, 2022. 

The 2022 Technical Report is compliant with the Canadian system of reserve and resource reporting as required under the National Instrument 43-101 (“NI 43-101”) Standards of Disclosure for Mineral Projects and that required by The South African Code for the Reporting of Exploration Results, Mineral Resources and Mineral Reserves (“SAMREC”). The 2022 Technical Report presents an update of the October 1, 2012 NI 43-101 compliant Mineral Resources and Mineral Reserves report issued on March 6, 2013 (the “2012 Technical Report”)

A comparison of the 2022 Technical Report and 2012 Technical Report is provided below:

 

 

Proven (kt)

Probable (kt)

Total Saleable (kt)

Reserve Block

Seam

Oct 2012

Jan 2022

% Change

Oct 2012

Jan 2022

% Change

Oct 2012

Jan 2022

% Change

Aviemore East

Gus

*

257

*

*

-

*

*

257

*

Aviemore North

Gus

*

2,930

*

*

2,526

*

*

5,456

*

Balgray

Gus

*

547

*

*

1,539

*

*

2,086

*

Total Aviemore

Gus

559

3,734

85.0

7,095

4,065

(42.7)

7,654

7,799

1.9

Magdalena

Alfred + Gus

23,616

3,219

(86.4)

-

-

-

23,616

3,219

(86.4)

Total Buffalo Coal

All Seams

24,175

6,953

(71.2)

7,095

4,065

(42.7)

31,270

11,018

(64.8)

* Only total Aviemore reserves reported in 2012

  1. 1. Column totals may not add up due to rounding differences.
  2. 2. October 2012 estimate for Aviemore only provided as total reserves.
  3. 3. Magdalena's reserves now only includes >16% volatile coal, whereas the 2012 report also included < 16% volatile coal. The mining of <16% volatile coal will be reconsidered when suitable markets are evaluated. There was also a change in the mining height cut-off used from 0.8 m used in October 2012 to 1.5 m cut-off used in January 2022. The exclusion of the <16 volatile coal along with the change in mining height cut-off were the main drivers in the reduction of Magdalena's saleable reserves from 2012 to 2022.

Qualified Person

Mr Ian Alexander MacFarlane, BSc (Mining), MBL (UNISA), FSAIMM and AMSACMA is the Qualified Person, as defined in NI 43-101, responsible for the mineral resource estimate and mineral inventories reported in the 2022 Technical Report. He has read and approved the relevant technical portions of this news release related to the mineral resource estimates for which he is responsible.

The 2022 Technical Report can be found on the Company’s website at www.buffalocoal.co.za and on SEDAR at www.sedar.com.

Restructuring of the Investec Loan

Further to the Company’s announcement dated March 3, 2022 the Company and Investec Bank Limited (“Investec”) concluded negotiations regarding the restructuring of the R46,114,971 owing on the Investec Loan, on March 30, 2022. The following salient terms were agreed to:

   • Monthly capital repayments of R250,000 for March 2022 to June 2022;
   • Monthly capital repayments of R250,000 for March 2022 to June 2022;
   • Subject to the Group having secured R120 million in funding for the development of the Balgray project, an amount of R6.5 million to be repaid at the earliest of 30 June 2022 or the date on which the funding has been           secured;
   • Monthly capital repayments of R1,250,000 for July 2022 to August 2022;
   • Monthly capital repayments of R2,500,000 for September 2022 to December 2022;
   • The final maturity date and date by when the restructuring of the remaining capital balance owing should be agreed to be extended to December 31, 2022;
   • The Group would be allowed to spend R6.5 million on the development of the Balgray project in the absence of any third-party funding until June 30, 2022; and
   • The reserve bank account and cash sweeping mechanism will continue.


Emma Oosthuizen, the Company’s Chief Executive Officer, commented that “The Resources and Reserves Technical Report Update supports positive confirmation that value can be unlocked from the Group’s Balgray, Magdalena and Aviemore North’s mining projects.

The agreement reached with Investec regarding the restructuring of the Investec Loan allows the Group to continue with limited scale development of Balgray whilst discussions with existing and potential new investors are ongoing.”

Balgray is the Group’s highest priority project and will extend the Group’s anthracite operations by approximately 7 years and would need to become operational during the first quarter of 2023 to replace the diminishing Aviemore East reserves.”

About Buffalo Coal

Buffalo is a coal producer in South Africa. It holds a majority interest in two operating mines through its 100% interest in Buffalo Coal Dundee, a South African company which has a 70% interest in Zinoju Coal Proprietary Limited (“Zinoju”). Zinoju holds a 100% interest in the Magdalena bituminous mine, the Aviemore East anthracite mine and the Balgray and North Adit anthracite projects in South Africa. Buffalo Coal has an experienced coal-focused management team.

The Company has its primary listing on the TSX Venture Exchange (“TSXV”) and has a secondary listing on the Alternative Exchange (“AltX”), operated by the JSE Limited.

Neither the TSX Venture Exchange, nor its regulation services provider (as that term is defined in the policies of the exchange), accepts responsibility for the adequacy or accuracy of this release.

FOR FURTHER INFORMATION PLEASE CONTACT:

Emma Oosthuizen
Chief Executive Officer
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.