Bathurst confirms Stockton purchase
Company expects huge rise in production
Bathurst Resources has confirmed the purchase from receivers of Solid Energy’s Stockton mine, which has infrastructure strategically placed to service its Buller Coal Project.
The ASX-listed company with Wellington headquarters projects a huge uplift in production thanks to the output of Stockton and two mines near Huntly that previously supplied the Huntly Power Station.
Bathurst yesterday said it had agreed a 30-month contract to supply up to 150,000 tonnes a year from its Rotowaro and Maramarua mines. Analysts say it is likely to supply the power station as needed.
Macquarie Research analysts last month raised their full-year 2018 forecast for hard coking coal by 18 per cent to US$155 ($213.8) a tonne in line with its upgrade for iron ore tied to what it saw as “improving sentiment for Chinese demand and strong macro-economic data” that had driven most spot commodity prices higher.
BT Mining, the Bathurst-Talley’s Group joint venture formerly known as Phoenix Coal, has acquired Solid Energy’s Stockton, Rotowaro and Maramarua mines and other properties for $96 million.
It is buying mines that will lift production by 1.8 million tonnes a year to 2.2 million tonnes. Of that, 1.7 million tonnes is steelmaking, or coking, coal.
Stockton’s rail link runs to Lyttelton Port and it has existing steelmaker customers in India and Japan.
“Stockton is the jewel in the crown but I wouldn’t dismiss the Waikato assets — I would expect BT Mining to start supplying the Huntly Power Station, which for Bathurst will provide valuable local trade cash flow,” said John Kidd, an energy analyst at Woodward Partners.
Bathurst turned to a loss of A$1.9m in 2017 from a year-earlier profit of A$1m.
Solid Energy was placed in voluntary administration last year after concluding it had no realistic prospect of refinancing $239m of debt facilities.