A ”tumultuos” year for would-be West Coast coal exporter Bathurst Resources appears set to spill over into 2015 – with specialist hard coking coal prices still in the doldrums.
Bathurst has been treading water, relying on coal from three small South Island mines for domestic use, to keep it in cash flow, since it won a string of legal challenges to allow it to start mining. However, consent to mine coincided with a massive slump in global coal prices and made export operations uneconomic.
Other than site preparation work on the Denniston plateau, above Westport, Bathurst is waiting out the price slump, with coking coal on Monday selling for about USD 110 per tonne, or less. As with the coal price, Bathurst shares have similarly slumped, having plunged from 23c in mid January to 2c in recent weeks.
Mr Hamish Bohannan, MD, said that it ‘had been a tumultuous year for Bathurst, and detailed domestic activities, but gave no estimate on the export market. Mr Bohannan said that “Its a tough market out there but we’re fortunate to have a base business to sustain us until the time is right to get back into the export market.”
He said that its domestic operations produced revenue of USD 55.5 million as a stand-alone business unit, compared with USD 41 million the previous year, on coal sales of about 350,000 tonnes.
He added that “The global coal market is cyclical and, as long as the world needs steel, it will recover.”
Mr Bohannan said that the company had the benefit of a good domestic business to support it, until coking coal prices recovered, and then Bathurst could develop its great resource.
The Cascade mine adjacent to Denniston has a three-year contract with a cement plant, while Takitimu in Southland and Canterbury Coal have respectively seven-year and three-year contracts with dairy plants.
Source – odt
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