Vale ignores Eagle Downs deadline

Aquila Resources today confirmed that Vale-subsidiary Bowen Central Coal (BCC) had not signed off on the infrastructure arrangements for the Eagle Downs project by last Friday’s deadline.

Aquila Resources today confirmed that Vale-subsidiary Bowen Central Coal (BCC) had not signed off on the infrastructure arrangements for the Eagle Downs project by last Friday’s deadline.

The $2.3 billion coking coal project, a 50-50 joint venture between Aquila and BCC located in Queensland’s Bowen Basin, is now in some doubt.

The company has issued BCC with a default notice, however the partner has indicated it does not think it has breached any agreements.

The arrangements included an allocation of storage capacity at the expanded Abbot Point coal terminal ready for export in 2012-13, as well as access to Queensland Rail’s upgraded rail network.

“As the relevant agreements were not executed and returned to the relevant counterparties by the deadline, capacity on the rail project and at the Abbot Point coal terminal has not been secured by the joint venture,” Aquila said in a statement.

The company had agreed to the infrastructure arrangements before the close date, but it is thought that Vale would prefer to export out of the Dalrymple terminal in Mackay.

This would push any export date back to 2015.

“Aquila will continue to investigate the infrastructure opportunities available to the joint venture,” the company said.

“Whilst Aquila will continue to seek to resolve this matter with BCC, in the meantime it will pursue its rights under the joint venture agreement, in respect of the default notice it issued on BCC.”

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