Bandanna Energy has gone into voluntary administration after failing to secure take or pay contracts for a proposed coal mine in Queensland’s Bowen Basin.
The exploration company had been in talks with Credit Suisse to secure take or pay obligations for its $1.2 billion Springsure Creek project to Wiggins Island Coal Export Terminal for ship loading capacity and to Aurizon for rail access.
Bandanna said while it was well advanced on issues balked at by investors, the company was unable to reach an agreement with Credit Suisse.
The company said it had little ability to raise funds which would allow it to develop the mine and had no choice but to call in administrators.
Company chairman John Pelger said Bandanna had worked hard to progress the project including obtaining EIS approval from the state government, environmental approval from the federal government and support from the local community.
“Unfortunately, progress has been impacted by delayed approval of the Springsure Creek mining lease and the deepening cyclical decline in seaborne thermal coal prices, which together have further exacerbated delays in investor interest and participation,” Pelger said.
The company thanked its employees and management team for their “relentless and energetic efforts during extremely challenging market conditions”.
Springsure Creek coal mine was going to be an underground mine 47 km south-east of Emerald that would produce 5.5 million tonnes of coal per annum.
Expected to have a life-span of 40 years the mine was expected to employ close to 600 people.
In June the company said it was working to resolve farmer objections to the project, but conceded that until this process was finished, a final investment decision was uncertain.