Indian owned Australian metallurgical coal producer, Wollongong Coal, will have to wait another two months before it can move ahead with plans to expand its Russell Vale coal mine to 1 million tpy, after the New South Wales (NSW) planning minister asked the Planning Assessment Commission (PAC) to review the plan's approval.
The NSW government last month recommended that the PAC approve the mine expansion, which Wollongong Coal said is essential to keep the mine operating. But last week planning minister Pru Goward asked the PAC to review the plan because of intense environmental and community opposition to the mine. She gave the PAC until 20 March to complete its review of the extension, amid concerns that it may damage water supplies to nearby Sydney.
According to Argus Media, Wollongong, which was previously NRE Gujarat, has been under financial pressure while it awaits approval for Russell Vale's expansion. The company was forced to close its other mine, Wongawilli, in late July because it was uneconomic. The further delay to approval for the expansion of Russell Vale, which should make the mine much more profitable, will add to the company's financial stresses in the current climate of depressed metallurgical coal prices.
In April last year, the company held talks with workers at Russell Vale over possible job losses, as it looked to cut costs.
Wollongong Coal raised AUS$53.74 million (US$44 million) last month from a capital raising that had been designed to raise AUS$66.67 million. The funds were raised to pay down debt. Indian steelmaker Jindal Steel increased its stake in Wollongong Coal to 82.04% from 74.39%, through the rights offer. If Jindal acquires more than 90% of Wollongong Coal it has the right to compulsorily buy all outstanding shares and take over the company.
Wollongong made a loss of AUS$62.6 million in the 2014-15 fiscal half year to 30 September. Russell Vale produced 49,867 t of metallurgical coal during July-September, up by 31.6% from 37,885t in April-June.
Edited from various sources by Sam Dodson
Read the article online at: https://www.worldcoal.com/exploration-and-development/13012015/new-south-wales-coal-mine-under-review-once-more-1739/