White Energy has announced an AUS$31.8 million loss for the six months to December 2015 after taking an almost AUS$10 million writedown on its US coal mining business, Mountainside Coal Co. (MCC). MCC operates a number of mines in Kentucky.
MCC currently mines low-ash stoker coal for the silicon smelting industry in the US, generating AUS$14.7 million in coal sale revenue for the half year. Despite this, the company reported a loss of AUS$6 million for 2H15, resulting in the company’s management scaling back coal production and reducing mining costs.
With only AUS15.4 million in cash reserves at the end of the half year, the company is facing bankruptcy unless additional funding can be raised.
The directors struck a confident note in their half-year report, however, saying they were confident that the company could raise the required cash through a variety of means including additional equity funding, third-party debt financing, the sale of assets and shareholder loans.
Despite the financial uncertainty, White Energy continued to test MCC fines at its Cessnock binderless coal briquetting (BCB) demonstration plant with the ultimate aim of constructing a BCB plant at MCC’s mining operations. According to the company, a final investment decision on the potential BCB plant will be made in the “near future” with construction taking 12 months.
Outside of the US, the company’s 51% joint venture in South Africa, River Energy JV Ltd, continues to progress a number of projects with a final decision to proceed with one project at a South African coal producer expected by 31 March.
White Energy also continues to perform due diligence work on a number of coal concessions in Indonesia, which have been identified by the company for potential acquisition.
Read the article online at: https://www.worldcoal.com/coal/01032016/white-energy-future-uncertain-after-half-year-loss-2016-324/