Regency Mines PLC raised the possibility of forfeiting its 47% stake in Mining Equity Trust LLC, operator of the Omega coal mine in Virginia, as it remains unable to access the capital markets.

The company said March 11 that it has failed to attract new funding as shareholders recently disagreed to lift their pre-emption rights over the 500 million new ordinary shares the company intends to issue to new investors.

As a result, Regency could not keep up with its required contributions to the Mining Equity Trust joint venture, leading to operational issues at Omega that included the idling of one of the two highwall miners.

Regency noted that it needs to pay its joint venture partner US$565,000 as well as an additional working capital of between US$400,000 and US$500,000 to boost the operations at Omega and pay off creditors.

Regency also said it is in discussions with lenders over an existing loan note. With its stake in the joint venture pledged as collateral, the company fears that it may have to give up its interest in the joint venture if it continues to miss payments.

For now, Regency said it is considering running an open offer of the shares, which may become part of a larger restructuring of its capital structure.

After resolving its current funding woes, the company said it intends to make managerial changes and conduct a strategic review of its entire portfolio.