Verve may have to relax

The WA Government says it may advise Griffin Coal's biggest customer to waive some conditions of an existing purchase contract.

The Western Australian Government said it is prepared to advise the State’s key energy provider Verve Energy to relax the conditions of its contract with struggling miner Griffin Coal.

Acting WA Premier Kim Hames said yesterday that Verve should waive conditions of a pre-purchase contract in an attempt to throw the debt-laden Griffin a financial lifeline.

Griffin was placed in administration on 4 January after failing to meet payment deadlines on debts of $25 million, possibly endangering the jobs of the company’s 480 workers.

Verve, Griffin’s biggest customer, has reportedly placed a number of tough conditions on an existing $4 million contract.

Griffin’s administrator KordaMentha says that the conditions, namely verifying the quality of the coal, will take up a valuable portion of the payment that could be better spent elsewhere.

“We have made it clear that those conditions can be waived in order to make this a meaningful offer that will, in effect, save those jobs for those working for Griffin Coal,” Hames told journalists yesterday in Perth.

“The quality of the coal now has been the same as it has ever been.

“There is no reason to suspect otherwise.”

It was revealed at a meeting with creditors on Wednesday that Griffin’s overall debts could ultimately total more than $1 billion.

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