Boom! This ASX coal share has rocketed 90% in a week

The MC Mining Ltd (ASX: MCM) share price was on fire again on Monday after returning from a trading halt.

The coal explorer’s shares jumped a further 14% to 57 cents.

This means the MC Mining share price is now up 87% since this time last week.

Why is the MC Mining share price on fire?

Investors have been scrambling to buy MC Mining and other ASX coal shares such as Whitehaven Coal Ltd (ASX: WHC) recently in response to sky high coal prices.

In addition, after the market close on Friday, the company responded to a price query response from the ASX.

MC Mining suggested that the positive work that has been happening at its operations recently could be behind the rampant buying. The company explained:

[T]he Company has recently made a number of positive announcements (including in relation to the potential optimisation of its flagship Makhado hard coking coal project (Makhado) and in relation to a sales and marketing agreement which is expected to facilitate the sale and export of coal from the Company’s Uitkomst Colliery) at favourable API4 prices.

MC Mining also notes that these positive developments have occurred at a time when coal is a hot commodity.

The above noted positive announcements have been made by the Company at a time of robust hard coking coal prices, recent major corporate activity in the (increasingly buoyant) coal sector in Australia, and internationally, and renewed investor interest in advanced coal exploration, project development and mining companies.

Funding update

MC Mining also provided a small update on the its plans to implement a comprehensive financing solution to enable the development of the Makhado project.

While no agreement or decision has been entered into or made, the company continues to explore various fundraising options including both debt and equity financing. However, although talks are well advanced, it warned that they are still incomplete and there can be no certainty that any such transaction will be initiated.

The post Boom! This ASX coal share has rocketed 90% in a week appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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