Friday 19th February 2010 |
Text too small? |
Pike River Coal, which has been forced to raise additional capital during development of its coal mine near Greymouth, announced its first export shipment – 20,000 metric tons of coking coal, worth $3.4 million, being sent to India.
The customer, Gujarat NRE, one of two India coke companies that have agreed to buy Pike’s output for the life of the mine, estimated to be at least 18 years. The company’s long-term assumptions are for $1 billion of coal to be extracted, based on an average price of US$140 a ton and an average exchange rate of 59 US cents.
Gujurat and Saurashtra Fuels will take about 55% of Pike’s coal, with Japanese steel mills contracted to buy 22% of the mine’s output over the next three years.
Shares of Pike were unchanged at 93 cents on the NZX today and have sunk almost 20% in the past six months as the company had to contend with unforeseen extra development and remedial work at its site 50 kilometres northeast of Greymouth.
The delays drained Pike’s cash reserves as it continued spending on development without any revenue from coal sales, forcing it to tap investors for additional funds.
Chief executive Gordon Ward has said Pike needs at least $20 million more to tide it over and investors are awaiting details of its plans, which could include a mix of debt and equity offered at a discount.
Pike is 30% owned by New Zealand Oil & Gas.
Businesswire.co.nz
No comments yet
Daily ShareChat: Pike River Coal
Pike River cuts production forecast, shares tumble near month-low
Pike River gains $25m short-term facility from NZOG
Pike River seeks short-term funding
Pike River announces new CEO
Pike River CEO steps down, shares fall
Pike River loss widens ahead of mining
Daily ShareChat: Pike River Coal
MARKET CLOSE: NZ stocks rise; Pike River leads gains
Pike River gets first $10 million away no trouble