Miner defies odds on coal and Russia PEOPLE often tell mining executive Craig Parry he is mad for trying to start up a coking coal mine in remote far eastern Russia. DIPLOMATIC ties with Russia are at a low point, but Mr Parry is determined not to let politics get in the way of trade. The Tigers Realm Coal boss says the share market-listed miner's Russian project should be up and running by the end of 2015. That would be an impressive achievement for a small player wanting to develop a new mine that produces a struggling commodity in a country that Australia has imposed economic sanctions on. But Tigers Realm does have Russia's backing. The country's biggest private equity firm, Baring Vostok, and the Russian government's investment fund collectively own 50 per cent of the Australian company, and have tipped in $35 million and $14 million respectively. The sanctions imposed in the wake of flight MH17 being shot down were narrow and do not affect Tigers Realm, Mr Parry said. "It is obviously less than ideal but it hasn't created any problems for us other than perhaps around perception," he told AAP. We would love to see the Ukraine situation die down and I think it will in the next 6-12 months anyway. People thought it was a risk going to Russia but it has been a tremendous place to do business where you get government support and can permit the project effectively and quickly as well. The one to two years it is expected to take to get the project into production since drilling its first hole would take five to 10 years in Australia, he said. Low coal prices have convinced Tigers Realm to develop the far smaller and cheaper Amaam North mine, rather than the larger Amaam resource at what is a two-mine project. Mr Parry has had to hit the road this year, selling the company's story and reassuring investors that are sceptical about the wisdom of building a coking coal mine in far eastern Russia, close to Alaska. Tigers Realm's share price has almost halved in the last year to 9.5 cents. The company hopes last week's release of a bankable feasibility study will arrest that slide and convince investors and customers to back the project. It will produce one million tonnes of semi-hard coking coal each year at about $US68.50 - over 11 years - and cost $133 million to build, says Tigers Realm, above the sub-$100 million cost it estimated a year ago. The coal will be trucked 35 kilometres to port, much shorter and cheaper than the distances coal giants such as BHP Billiton have to send it by rail in Queensland. It still wants to build the $1.3 billion-plus, 6.5 million tonne a year Amaam project when the market improves, believing it will eventually grow to a 10-million tonnes-plus, making it a top five producer globally and one of the lowest cost. Not only is the company facing political and geographic pressures, the current coal price is down almost 20 per cent this year to about $US112 a tonne. Tigers Realm is confident prices will rise again in the near future and it will have no trouble getting the funds to build its mine. The price of coal has been below the cost of production for the top 10 per cent highest cost producers for two years, according to energy analysts Wood Mackenzie. They predict that 90 million tonnes - or 10 per cent - of global supply will inevitably drop out in the next three months, and a rebound in prices longer term to $US180. When that happens, says Mr Parry, Tigers Realm will be well placed from its Pacific Ocean location to ship coal to China and Japan. "They never had a reason in the far east to develop it because there's no steel mills and no export mentality," he said. What's driving it now and the government investment in us is they want to build up and strengthen those ties with China. As well as a political rivalry, there is a resources-driven economic battle, with Russia trumping Australia earlier this year in sealing a $US400 billion deal to pipe natural gas to China.