Hartshorne Mining in Poplar Grove has experienced production and financial setbacks due to “unplanned geological faults,” according to announcements released by Hartshorne’s parent company, Paringa Resources Limited.

The Poplar Grove mine first encountered its issues in December, according to the announcement. The company released an announcement on Dec. 23 stating that a geological fault was found to displace the coal seam by 12 feet.

While the company decided to continue mining through the fault and into the coal seam, the process will prolong coal production due to cutting through rock and experiencing unfavorable mining conditions.

“The occurrence of geological faults in the region are not uncommon, however this fault was not identified by any of the company’s consultants in preparing the mine plan,” the press release stated. “The company has instigated a drilling program to try to understand why the fault was not previously identified, whether there are any additional faults, and to define the geological conditions going forward …”

In addition to production setbacks, the company is also experiencing financial concerns. Due to “operational challenges,” the company has been unable to reach anticipated production volumes thus far and its cash balances may potentially fall below its minimum allowed cash balance per its loan agreement.

According to a Jan. 8 announcement, in light of prolonged production, Hartshorne has hired a consulting agency to assess its financial outlook and any additional funding needs. The company has also deferred its quarterly interest and fees payment on its loan, equalling $1.5 million, which enables the loan company to require immediate full repayment of the loan facility.

McLean County Judge-Executive Curtis Dame said “Basically they have encountered environmental issues related to fault formations and issues with production.”

He said he believes the company will be able to continue the production levels it originally anticipated “if they can overcome these short-term obstacles. Demand is there.”

cnetherton@mcleannews.com, 270-691-7360

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