Athabasca’s acquisition of Aggregates Management Inc
by Jo Black

Athabasca Minerals announces details concerning its proposed non-arm’s length acquisition of all of the issued and outstanding shares of Aggregates Management Inc. (AMI).
AMI is a private company with long term contracts to manage two major sand and gravel pits for the Alberta government located in the heart of the oil sands industry in the Fort McMurray region.
AMI’s mandate is to manage the removal of surface materials for public use and reclaim the site after the area is depleted of the surface material. AMI is responsible for:
salvaging all merchantable timber;
soil salvaging and handling;
overburden management;
supervising and managing the removal of surface materials;
maintaining the road network within the pit;
providing aggregate washing facilities;
operating scales and weighing all highway trucks;
conducting a volumetric survey of aggregate removed;
reclaiming depleted areas;
collecting the royalties for the Crown; and
reporting and paying royalties collected to Alberta Sustainable Resource Development on a monthly basis.
For these services, AMI receives a management fee for each cubic metre of sand and gravel removed from the pits for the duration of the contracts.
The two sand and gravel pits are the Susan Lake Gravel Pit (Susan Lake), located approximately 80 km north of Fort McMurray, and the Poplar Creek Gravel Pit (Poplar Creek), which is located approximately 30 km north of Fort McMurray.
These two sand and gravel pits are currently the two major suppliers to the Fort McMurray region.
Susan Lake is approximately 9,400 acres (3,760 hectares) in size. AMI started operating this pit in 1998.
In 2006, Susan Lake produced 5.2 million tonnes of sand and gravel and in 2007 it produced 7.2 million tonnes of sand and gravel, all for use by neighbouring oil sands companies and the surrounding area of the City of Fort McMurray.
The purpose of the acquisition is that it is consistent with Athabasca’s evolving business model to create and capitalize on market opportunities in the sand and gravel sector in Alberta.
The acquisition will generate predictable cash flow to the company and establish Athabasca as the major sand and gravel suppler to the oil sands industry and other developments in the Fort McMurray area.
An additional reason for the acquisition is that the predictable revenue stream resulting from the Acquisition will enable management of Athabasca to finance Athabasca’s exploration for minerals used in oil sands processing and construction such as salt, silica sand, gypsum and limestone.
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