A mothballed coal development could be revived soon due to ambitious plans to resume work.
Mining magnate Nathan Tinkler, M Resources, Evolution Capital, and a joint venture between Tetra Resources and Javelin Private Capital Group, are all trying to reopen Australian Pacific Coal’s Dartbrook Coal Project – 122km northwest of Newcastle.
The operation has been under care and maintenance since 2006, following multiple workplace accidents and low commodity prices.
The JV, backed by “international coal experts” Trey Jackson, Brian MacDonald and Michael Mapp, want to dilute existing Australian Pacific Coal (AQC) shareholders by more than 90 per cent to just 6.9 a per cent stake.
The companies will raise capital to cover the cost of restarting operations. Javelin Global Commodities will also lead a private debt placement facility that provides up to a quarter of necessary capital. QMEB can reveal the cost of replacing infrastructure is estimated to be about $300 million.
Mining/operational diligence, five year mine planning, capital budgeting for resuming work, and most commitments for personnel, equipment, and contractor/vendor services are already complete.
“While Nathan Tinkler and M Resources have been jousting for control of AQC in proposals that did not address the how, when or estimated costs to restart the Dartbrook Coal Project, this team of experienced coal operators has quietly been working in the background for 10 months to provide AQC a comprehensive proposal,” the JV said in a public statement.
“[We intend] to begin the restart work immediately upon financial close.”
M Resources and Evolution Capital alternatively proposed to conduct a different, “highly dilutive” entitlement offer.
“The highly dilutive capital raising is being done at 34 cents per share whilst the shares trade today at 57.5 cents per share – nearly a 50 per cent discount to the current trading price,” the JV said.
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