TerraCom is one step ahead in fulfilling its progressive rehabilitation obligations at the Blair Athol mine in Clermont, Queensland, which forms part of the conditions for acquiring the mine from Rio Tinto for just $1.
The company established a $72 million bonding facility with an underwriter, but it only required a cash backing of $45 million.
TerraCom chairman Wal King said the establishment of this bonding facility was extremely positive for the company.
The facility released $27 million of restricted cash, or money that is held for a specific purpose, on TerraCom’s balance sheet.
“It demonstrates that an independent third party has assessed the maximum rehabilitation exposure at the Blair Athol mine site to be no more than $45 million,” King said.
The Blair Athol Coal joint venture managed by Rio Tinto had previously paid the Queensland Government nearly $80 million for rehabilitation purposes.
TerraCom didn’t meet its 2018-2019 rehabilitation commitment of 40 hectares due to a focus directed towards the capping of the decommissioned tailings storage facility (TSF).
The company, however, rehabilitated 50 hectares of the site in the first six months of its operation, and established an additional 10 hectares of treatment trials in 2017.
TerraCom aims to rehabilitate nearly 100 hectares for the 2019-20 financial year, which is a combination of historical areas and active mining works. The company is also set to produce three million tonnes of thermal coal a year over an eight-year mine life.
Operations at Blair Athol have also ramped up to a production rate of over 2.7 million tonnes a year within 18 months of TerraCom taking ownership.
“The imminent completion of the refinance will provide the opportunity for the board to consider delivering on its short-term goal of paying a maiden dividend to shareholders,” King concluded.