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Ramaco Resources, Inc. Announces Expansion of Future Production with Agreement to Acquire Maben Coal LLC and Expansion of Elk Creek Coal Preparation Plant

LEXINGTON, Ky., August 8, 2022 /PRNewswire/ — Ramaco Resources, Inc. (NASDAQ: METC) (“Ramaco” or the “Company”) announced that it has entered into a securities purchase agreement with Appleton Coal LLC to acquire 100% of the members’ interest in Maben Coal LLC for an aggregate purchase price of $30 million (the acquisition”). The purchase price will include (i) $9 million payable in cash at closing and (ii) $21 million to be paid out of the proceeds of a secured note payable to Investec Bank, PLC (the “Lender”) under a loan facility between the Lender and the Company. Completion of the Acquisition remains subject to customary closing conditions, including the receipt of certain consents and the delivery of ancillary transaction documents. The Company expects closing to occur in August. The acquisition is expected to be accretive to the company over the next 12 months.

Coal reserves held by Maben Coal LLC consist of approximately 33 million tonnes of mineable coal on over 28,000 leased acres located at Wyoming County and Raleigh County, West Virginia. The property contains various zones of low volume, high quality coal in the Pocahontas 3, Pocahontas 4, Sewell, and Pocahontas 6 (and all seams between the Sewell and Pocahontas 6) coal seams.

The Company expects the 1.5 million tonnes of coal contained in the Sewell vein to be mined immediately by open pit and high wall mining methods. The 31 million tonnes of coal contained in the Pocahontas 3 and the Pocahontas 4 veins can also be developed in the near future through deep mining.

The property has existing mining permits issued by the West Virginia Department of Environmental Protection that permit surface and highwall mining, as well as underground mining operations. The property has also issued permits covering an existing haul road, as well as an active waste disposal area as well as a preparation plant and unit train loadout, none of which have yet been built.

Development of the Sewell Seam mine will begin immediately after closure. Initial production is scheduled for the fourth quarter of 2022 and is expected to produce 25,000 tonnes in 2022. It will increase to approximately 250,000 tonnes in 2023 and will remain at this level through 2030. The Company estimates that if operating today, the maben reserves would have cash mining costs in the $80 per ton, plus trucking costs to our Knox Creek preparation plant.

Capital expenditures related to the maben acquisition and development, including equipment, is expected to be approximately $15 millionwith the majority of this investment in 2022.

The Company expects to determine in the future the timeline for advancing the development of deep mine reserves in the Pocahontas 3 and the Pocahontas 4 seams. Such future development would involve the addition of approximately 1 million tonnes per year to full production with the construction of a new preparation plant and loading mentioned above.

The Company also announced that it had recently approved the expansion of its Elk Creek the prep plant to 3.0 million tonnes of annual capacity from its current level of 2.1 million tonnes at the end of 2021. This expansion has already begun and is expected to reach full pace by mid -2023. This expansion will involve the expenditure of $5 million in 2022 and $4 million in 2023.

Randall AtkinsRamaco’s Chairman and Chief Executive Officer noted, “Today, Ramaco announced two significant milestones that will potentially increase our production capacity by an additional approximately 2 million tonnes over the next several years, compared to end-of-life levels. from last year.

The maben This acquisition fits well with Ramaco’s strategy of opportunistically acquiring advantageous reserves that we can develop at low capital and operating costs. We intend to immediately commence highwall mining of approximately 250,000 tonnes of annual production in the Sewell vein later this year, with the possibility of additional deep mining to follow. The Acquisition will be amortized on this immediate production in less than two years. Ramaco will then analyze the option of developing the largest Pocahontas 3 and 4 seams, which could generate an additional annual production of around 1 million tons.

We also approved the increase in production and processing capacity of our flagship Elk Creek mining complex to 3 million tonnes from its previous size of 2.1 million tonnes at the end of last year.

Together, these two additions, along with the organic development of our other existing properties, now position us towards a future level of approximately 6.5 million tonnes of production over the next three years. This will essentially triple the level of production we had at the end of 2021.”

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this press release, including statements regarding future operating results and financial condition, anticipated product and service revenues and other measures, business strategy and plans, management objectives, market size and growth opportunities, competitive position and technology trends and market, are forward-looking statements. These forward-looking statements represent Ramaco’s expectations or beliefs regarding directions, future events, expected revenues, future demand and production levels, macroeconomic trends, ongoing project development, costs and expectations regarding results of operations, and it is possible that the results described in this press release will not be achieved. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are beyond Ramaco’s control, which could cause actual results to differ materially from the results discussed in the forward-looking statements. These factors include, but are not limited to, risks related to the impact of the global COVID-19 pandemic, unforeseen delays in our current mine development activities, failure of our counterparties to undertake sale, increased government regulation of coal in United States or internationally, declining demand for coal in export markets and underperformance of the railroads, expected completion of the Acquisition and its timing, expected benefits of the Acquisition to shareholders of the Company, and the anticipated benefits and impacts of the acquisition. Any forward-looking statement speaks only as of the date it is made and, except as required by law, Ramaco undertakes no obligation to update or revise any forward-looking statement, whether new information, future events or the like. New factors appear from time to time, and it is not possible for Ramaco to predict all of these factors. When reviewing these forward-looking statements, you should keep in mind the risk factors and other cautionary statements contained in Ramaco’s filings with the Securities and Exchange Commission (“SEC”), including its report annual report on Form 10-K and its quarterly reports on Form 10-Q. The risk and other factors noted in Ramaco’s filings with the SEC could cause its actual results to differ materially from those contained in any forward-looking statements.

Contact: [email protected] or 859-244-7455

SOURCERamaco Resources, Inc.