Linc Energy leaves ASX under administration

Underground coal gasification pioneer company Linc Energy has entered voluntary administration in Australia, angering environmental groups who say the company has done so to avoid facing the damage caused by their experimental plant at Chinchilla.

On Friday last week the Australian arm of Linc Energy relinquished control to PPB Advisory as administrators.

Information about the company has been withdrawn from the Australian Securities Exchange, but the company is still listed on exchanges in Singapore (SGX) and the US (OTCQX).

Linc Energy face up to $56 million in fines relating to environmental breaches and pollution caused at their experimental plant near Chinchilla, in Queensland’s gas fields of the Surat Basin, although the company has denied charges, and described evidence against it as circumstantial.

“It is going to be difficult to get any money out of this company…”

-Drew Hutton, Lock the Gate

The company has also been charged with exposing workers to uncontrolled releases of toxic Syngas between 2007 and 2013.

Syngas or synthesis gas contains carbon monoxide, benzene and toluene among other toxic compounds, and is the product of combustion of underground coal seams, or Underground Coal Gasification (UCG).

Although the UCG process is often described as “burning” underground coal seams, a spokesperson for Linc Energy said that description was inaccurate, as the coal is heated to the point of combustion under pressure without flame.

Lock the Gate’s Drew Hutton said the withdrawal from trading in Australia was a common legal strategy for avoiding fines and the cost of environmental rehabilitation.

“It is going to be difficult to get any money out of this company now that it is in administration,” he said.

Hutton warned that other companies around the state, in particular coal mines, could use the same strategy in future.

“We have already seen at Clive Palmer’s nickel refinery near Townsville, they have gone into administration with a rehabilitation bond, and there are many other mines around the state with inadequate bonds,” he said.

 

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