Barnett threatens Griffin Coal exports

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WA Premier Colin Barnett has threatened to stop coal exports from Indian energy giant Lanco’s Griffin Coal mines if it abandons a key domestic supply contract.

The recently acquired mines near Collie have been a controversial topic in WA since the company first tried to stop supplying coal to local buyers.

Last month Lanco withdrew a threat to stop supplying coal to the Bluewaters power stations, which supply around ten per cent of the state’s electricity, but said the dispute had not been resolved.

It said the prices it supplies coal to Bluewaters would have to double for Griffin Coal to be viable.

According to The Australian, Lanco plans to export all or most of the Griffin coal back home to its own power stations in India.

Lanco is also close to cancelling a coal supply contract for a fertiliser project with Australian-based Perdaman Chemicals.

Perdaman has filed a $3.5 billion damages claim over the contract.

Barnett said last month that when Lanco bought the mines for $800 million from fallen tycoon Ric Stowe the company had been well aware of the local contracts. 

“Lanco is a large and sophisticated Indian company, so when they paid for that asset they had their eyes wide open, in my view,” he said.

“And I made it very clear that they cannot expect to be exporting coal out of here at a cost to the West Australian economy — we will simply not allow that.”

A Lanco spokesperson told The Australian the company was working to resolve a number of issues it had inherited when it bought the mines.

“When Lanco bought Griffin Coal, the mine was in administration and we have been working to resolve a number of legacy issues in order to return stability to the business and ensure sustainable growth,” he said.

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