BUFFALO COAL CORPORATION - Restructuring of Companys Dundee Operations

Release Date: 05/09/2018 16:03
Code(s): BUC
 
Wrap Text
Restructuring of Company’s Dundee Operations

BUFFALO COAL CORP.
Registration number: 001891261
External company registration number: 2011/011661/10
Share code on the TSX Venture Exchange: BUF
Share code on the JSE Limited: BUC
ISIN: CA1194421014
"Buffalo Coal" or "the Company"

RESTRUCTURING OF COMPANY’S DUNDEE OPERATIONS

The company announced today that STA Coal Mining Company Proprietary Limited (“STA”), a mining
contractor engaged by the Company to provide contract mining services at the Company’s Magdalena
underground mine in South Africa, has provided notice to the Company of its intention to not renew the
contract mining services agreement (the “STA Agreement”) dated October 31, 2015 entered into by
STA, the Company and certain subsidiaries of the Company, following the expiry of such contract in
accordance with its terms on October 31, 2018. Under the terms of the STA Agreement, STA currently
conducts all underground coal mining operations at the Magdalena mine under the supervision of the
Company.


In light of the foregoing, and having regard to the Company’s current financial position, the Company is
initiating a restructuring process at its Magdalena mine operations aimed at ensuring the viability of the
business going forward. If no feasible alternatives are found, such process may ultimately result in
employee retrenchments and may involve the closure of the Magdalena mine operation. A consultation
process has commenced in South Africa with organised labour and relevant stakeholders, as required
pursuant to section 189A of the South African Labour Relations Act. Further details on the outcome of
this process will be announced at the appropriate time.


About Buffalo

Buffalo is a coal producer in southern 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 a 100% interest in the Magdalena bituminous mine and the Aviemore anthracite mine in
South Africa. Buffalo has an experienced coal-focused management team.


Cautionary Notes:

This press release contains “forward-looking information” within the meaning of applicable Canadian
securities legislation. Forward-looking information includes, but is not limited to, information relating to
the Company’s restructuring initiatives and the impact of such initiatives on the Company’s operations
and financial condition. Generally, forward-looking information can be identified by the use of forward-
looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”,
“scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or
variations of such words and phrases or state that certain actions, events or results “may”, “could”,
“would”, “might” or “will be taken”, “occur” or “be achieved”. Forward-looking information is subject to
known and unknown risks, uncertainties and other factors that may cause the actual results, level of
activity, performance or achievements of Buffalo to be materially different from those expressed or
implied by such forward-looking information, including but not limited to: general business, economic,
competitive, foreign operations, political and social uncertainties; a history of operating losses; delay or
failure to receive board or regulatory approvals; timing and availability of external financing on
acceptable terms; not realizing on the potential benefits of the proposed transaction; conclusions of
economic evaluations; changes in project parameters as plans continue to be refined; future prices of
mineral products; failure of plant, equipment or processes to operate as anticipated; accidents, labour
disputes and other risks of the mining industry; and, delays in obtaining governmental approvals or
required financing or in the completion of activities. Although Buffalo has attempted to identify
important factors that could cause actual results to differ materially from those contained in forward-
looking information, there may be other factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such information will prove to be accurate, as actual results
and future events could differ materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking information. Buffalo does not undertake to
update any forward-looking information, except in accordance with applicable securities laws.

Neither the Toronto 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:

Rowan Karstel                                             Graham du Preez
Chief Executive Officer                                   Chief Financial Officer
Email: rowan.karstel@buffalocoal.co.za                    Email: graham.dupreez@buffalocoal.co.za


Johannesburg
05 September 2018


Designated Adviser
Questco Corporate Advisory (Pty) Ltd

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