CQ mine owner in receivership, $34m owed to contractors
THE owner of Bluff mine, 150km west of Rockhampton, has fallen into receivership owing more than $34 million.
Carabella Resources was bought by China Kingho Energy Group in 2014 and construction of the Bluff PCI (Pulverized Coal Injection) Coal Project began in 2018.
Contracting company MACA Mining was appointed on a 10-year $700m contract to operate the mine in 2018, and is responsible for all day to day operations of the mine.
MACA Limited manages projects in Australia and Brazil.
The first coal at Bluff was dug in February 2019, with a 1.2mt per year output of PCI coal for use in iron manufacturing.
MACA Limited announced late last month the Bluff mine had been placed into care and maintenance, citing the coal price slump as the underlying reason.
“While the coal price remains below economic levels and uncertainty remains regarding Chinese Government policy relating to Australian metallurgical coal imports. The parties are working to fulfil current coal sales obligations with mining services expected to halt around the end of November 2020,” the statement read.
The statement went on to read MACA Limited was owed $34.7 million, as of June 30, 2020, for mining services performed and the working capital facility.
“We believe it is prudent to cease operations until a sustained recovery in the PCI coal price occurs,” the MACA Limited statement said.
It is unclear how many staff were employed at the mine however most have been transferred to other sites.
“MACA are able to redeploy the majority of the Bluff fleet to existing and new projects which are commencing shortly,” the statement said.
“A relocation of the Bluff fleet will reduce the expected capital expenditure for FY21 by $35M as a result.
“Work in Hand at the end of September, after removing Carabella, stands at $2.4 billion.
“WIH and work already delivered for FY21 currently stands at $823 million of which $649 million relates to the mining segment.
“WIH for FY22 now stands at $546 million of which $521 million relates to the mining segment.”
MACA Limited yesterday called in FTI Consulting as receivers and managers of its contract with Carabella Resources in a bid to recoup debts.
The metallurgical coal price has recently fallen below $US100/t for the first time since mid-2016, creating pressure on many Australian metallurgical producers.
MACA Limited announced in it AGM, its statutory results had been impacted by COVID-19 in the second half of the financial year.
While it didn’t limit operations, it “significantly influenced the reported results through its detrimental effect on broader economic drivers, such that MACA reported an overall net loss after tax of $17.4m”.
All operations at Bluff PCI Coal Project are expected to be completed by the end of this month.