Aim- and ASX-listed Beacon Hill Resources would move into full production at it Minas Moatize project, in Mozambique, in the coming weeks, CEO Rowan Karstel reported last week.

The company started mining and processing operations at Minas Moatize in May, following the completion of the first phase of the operation’s wash plant upgrade.

A total of 153 520 t of run-of-mine (RoM) coal was mined, with 14 354 t of saleable coal produced. Production at the mine was only active during the final six weeks of the quarter ended June.

Karstel said that Beacon Hill would complete the commissioning of the Phase 2A wash plant in the coming weeks. The plant was wet-commissioned in May and the ramp-up was progressing well.

Beacon Hill was now focusing on pursuing the Phase 2B/2C implementation for the first half of 2014, subject to the availablity of bank or vendor funding to deliver the required volume of 2.8-million tons of RoM coal that would reduce unit production costs to that of a Tier 1 global hard coking coal producer.

The junior miner indicated that it was in discussions with various financial institutions to arrange a pre-export senior secured debt facility and/or a mezzanine debt facility to start its Phase 2B/2C capital expenditure.

The company also entered into negotiations with several equipment providers to submit finance proposals on a build-own-transfer (BOT) basis to fund the Phase 2B/2C wash plant upgrades.

“If the BOT vendor financing is completed satisfactorily, this would be expected to replace the senior debt facility requirement,” Beacon Hill said, pointing out that a decision on the funding for Phase 2B/2C was expected shortly after final BOT proposals had been assessed.

Post period-end, the production ramp-up continued to progress well, with the plant pro- ducing coking coal and thermal coal to expected specification and qualities. Produc- tion ramp-up was expected to increase further during the third quarter of 2013, as the com-missioning progressed.

Owing to the reduction in hard coking coal prices during the June quarter, inventory was being carefully phased to produce volumes that would coincide with rolling stock avail- ability in the third quarter of the year, Beacon Hill stated.

The company has prioritised the development of the associated rail infra-structure, most notably the Carbonoc trans-fer station in the town of Moatize, in Tete province, and the Beira transfer station.

The development of the Carbonoc transfer station is advancing on schedule to reach com- pletion at the end of August. However, the trans- fer station in Beira is currently behind sched-ule, with the company remaining in dialogue with Mozambique’s ports and railways auth-ority regarding interim measures until the final siding location is approved and construction work completed.