THE planned reopening of Dartbrook underground coalmine has hit another roadblock with the $20-million sale of a half share in the project falling through a year after it was announced.
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Mine owner Australian Pacific Coal told the stock exchange on Tuesday that a share sale agreement begun last August with Canadian company Stella Natural Resources had been "terminated" after certain conditions relating to the deal had not been met.
Although the company says it is committed to reopening Dartbrook and converting it from a longwall operation to a bord-and-pillar mine, the failure of the Stella deal is the latest in a line of disappointments.
Environmental opponents are going all out to stop the mine reopening, and a proposed modification of its mining licence to enable the bord-and-pillar conversion is before the Independent Planning Commission.
Additionally, recent falls in the price of export coal have added another pall of gloom to the industry, although supporters say prices will again recover and Australian Pacific is seeking approval to extend the mine life by five years to 2027.
The June 26 edition of Australian Coal Report shows the spot price of benchmark Newcastle thermal coal fell from $US82 in May to $US70.10 in late June.
The industry newsletter said Newcastle exporters were still being hit by the unofficial Chinese go-slow on unloading Australian thermal coal cargoes.
Quotes for the type of lower-energy coal sold to China had fallen by $US8 since May, to $US51.50, with the possibility of further falls to below $US50.
In its statement to the stock exchange on Tuesday, the company said it had terminated its agreement with Stella because the Canadian company had not satisfied "certain conditions" of their agreement.
These conditions were not defined, but in previous updates Australian Pacific had said that one condition was Stella obtaining "secured funding" to support the Dartbrook project, while the other was "NSW ministerial consent to the transaction".
On Tuesday, the company said it had "recently been in discussions with other potential development partners in relation to their interest in recommencing underground mining at Dartbrook".
It would keep an "open dialogue" with Stella, and "importantly", the company's biggest shareholder, Trepang Services Pty Ltd was still lending it money had a "continued commitment to the project".
Trepang is owned by Northern Territory tourism identity John Robinson and Nick Paspaley of the Paspaley pearling family and holds more than 39 per cent of Australian Pacific.
Related content: Dartbrook underground a dusty mine
Ian Kirkwood
Reporting journalist at the Newcastle Herald since 1987. Editorial writer, general reporter, industrial relations, industry and coal.
Reporting journalist at the Newcastle Herald since 1987. Editorial writer, general reporter, industrial relations, industry and coal.
