Griffin debt grows

Griffin Coal’s failure to meet royalty payments has added to its debt woes.

Griffin Coal has added to its growing debt by missing the payment of royalties worth almost $900 000 in January.

The miner failed to pay the Western Australian Government potentially $860 000 in royalties for coal produced in January and is predicted to miss another upcoming payment.

This follows negotiations with the Government which saw Griffin receive a $4 million capital injection as an advance on coal to be delivered to state owned power company Verve Energy.

The Department of Mines and Petroleum confirmed the miner had missed the scheduled payment.

While Griffin was not in arrears with its royalty payment when it entered administration, shortly after that royalty payments were missed.

Despite an exact amount for the royalty payments not being given, Griffin’s potential for an output of 340 000 tonnes per month and with coal royalties estimated to be around $2.50 per tonne, the expected royalty payment is thought to be around $860 000.

The missed payment adds to the company’s growing debt, with Griffin owing at least $700 million after entering administration in January following its failure to make a $25 million payment to US bond holders who are owed $525 million overall, as well as defaulting on a $5 million payment to the Australian Tax Office.

The miner’s collapse has led to its owner, Ric Stowe, carrying out a sale of his other assets to pay down the debts of the beleaguered coal company.

Administrators KordaMentha is looking to appoint advisors for the sale of the company and its assets, which are estimated to have debts up to $2 billion.

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