The sale of a controversial underground coal mine in the NSW Hunter Valley has fallen through, with the cancellation of a previous transaction and two other offloading options hitting a snag.
Financial reports from earlier this year revealed Australian Pacific Coal (AQC) is in "dire financial straits", but in February AQC told the ASX an offer had been made by Trepang Limited to buy the Dartbrook site outright.
Yesterday, AQC told the ASX that Trepang backed out on that offer on September 1.
"The termination notice was unexpected and was received while the Company was working towards re-convening the postponed extraordinary general meeting to approve the Trepang Transaction as soon as reasonably possible," a statement said.
AQC has now turned to investors to source $100 million to pay off an outstanding debt to Trepang and two other related parties.
The company told the ASX it had planned to raise $100 million regardless, in case the Trepang offer was rejected by the board.
"As a result of the termination, the fallback position has become an essential path to ensure the Company is suitably funded to service its ongoing obligations," the company said.
Tinkler takeover TBC, coal prices soar
Last month, two other companies put in bids to take over AQC: Nakevo Limited and M Resources Pty Limited.
Nakevo, the first to lodge an offer, is fronted by former AQC director Nathan Tinkler.
Tinkler, who also previously owned the Newcastle Knights NRL club, was declared bankrupt and banned from managing businesses in Australia in 2017.
That ban expired last year, meaning he can pursue opportunities to direct companies in Australia again.
The push for the mine to restart is an attempt to cash in on record coal prices, currently trading at about US$425 per tonne, according to analyst Tim Buckley.
"Thermal coal prices have hit an all-time high ... prices are up eightfold in the past two years and that can change absolutely everything," Mr Buckley said.
The Dartbrook mine has been in a care-and-maintenance phase since 2006, after a series of safety concerns and three deaths.
Buckley says the push by Tinkler, and the other interested parties, is a "serious punt" as it could take two years to get the mothballed mine operational again.
"Even a mine that's been in care and maintenance — in other words, totally abandoned — for the last 15 years could be resurrected.
"But in this market ... you're talking about billions and billions of dollars of coal that could potentially be mined even in a three-year period."
In 2019, the NSW Independent Planning Commission gave AQC the green light to restart the Dartbrook mine, but it refused a five-year mining extension.
That was overturned earlier this year after years in and out of the courts.
The Hunter's thoroughbred industry has long opposed plans to restart the mine, as have environmental groups.
All interested parties in the site are yet to comment.
