New South Wales-based coal producer Bounty Mining has announced its purchase of the Cook Colliery and Minyango coking coal project in Queensland from Caledon Coal and Blackwater Coal for $31.5 million.
The deal, announced November 10, is due to take place by the end of November; Bounty will pay an initial $6.7 million, with the remaining balance to be paid over 18 months.
In addition, Bounty will pay a further $10 million to Glencore subsidiary Cook Resource Mining for the purchase of assets associated with the Cook Colliery, such as rail loops, coal marketing agreements and wash plants.
Bounty aims to start coal production in the first quarter of 2018 with an aim to increase production to 1.8 million tonnes (Mt) in a year, subject to satisfactory due diligence.
Cook Colliery suffered from flooding in May 2017, an event which placed Caledon into administration. Bounty has received over $17 million from investors, going a fair way towards paying for the company’s purchases.
Gary Cochrane, the executive chairman of Bounty said he was pleased with the “elevated interest” in the mines.
“Our company has negotiated very attractive deal terms that will benefit shareholders both in the short term and through the life of the mine,” he said.
“We welcome new shareholders as they join us in recommencing mining operations at Cook and, in time, finalising mine plans and commencing operations at the outstanding and advanced Minyango project.”