Wednesday 18th June 2014
|Text too small?|
Bathurst Resources is to begin site works and extracting coal from a much reduced area of its consented Escarpment mine on the Denniston Plateau, above the South Island west coast town of Westport following the extension of its $22 million, five-year commitment to payments for the Department of Conservation to seven years.
Bathurst earlier this year all but put the Escarpment coking coal project in mothballs, reducing local staff and warning the development would have to await better prices for the high quality coal, which is used in the steel-making process.
However, the company went on to raise some $10 million in a placement to institutions and a rights issue shareholders in April and May respectively, and has now gained an Authority to Enter and Operate (AEO) on the site, whose development was hotly contested by environmental groups, whose appeals against the resource consents originally granted in August 2011 stretched the permissions process out by more than two years, to the frustration of Australian investors in Bathurst unused to New Zealand resource law constraints.
Conservation Minister Nick Smith announced the change from a five to a seven year schedule for payment of $22 million to DoC to compensate for the loss of conservation values caused by the project, and outlined a smaller mining plan than originally envisaged.
"Bathurst Resources will now construct the mine over an extended period and reduce the area that will be mined in the first two years from 62.2 hectares to 19.3 hectares and reduce the amount of coal extracted in this time period from 558 kilotons to 75 kilotons."
Production would ramp up further "when market conditions are more favourable," said Smith.
The announcement of a cautious start at Escarpment comes on a day when the government's resource extraction strategy took a serious knock, with the rejection of an application by TransTasman Resources to mine ironsands in the Exclusive Economic Zone, 22 kilometres off the coast of Patea in the south Taranaki Bight.
In a separate statement to the NZX, Bathurst said it planned to enter the site from July 1 and that initial works would comprise site clearing, initial water management dams and drainage systems, installation of coal stockpile areas, site roads and basic infrastructure, including a site office and the site readied for "when economic conditions warrant full commercial production."
No comments yet
MARKET CLOSE: Blue-chip stocks Meridian, A2 lead market lower
NZ dollar rises on Brexit hopes, rate cut reassessment
Three not failing, just needs a new owner - MediaWorks CEO
Major investors back new CBL class action targeting directors
Rip Curl purchase a done deal on Kathmandu proxies alone
Comvita chair Neil Craig eyes the exit once he finds a new CEO
Mercury raises guidance on increased storage, high spot prices
Eroad reports strong 3Q sales growth, eyes ASX listing
MediaWorks puts TV business on the block
NZ dollar benefits as preliminary Brexit deal improves risk appetite