Pike River Coal, New Zealand’s only listed coal miner, posted a $14.1 million first-half loss on Wednesday which, the company said, reflects the mine’s development phase.
The loss to 31 December 2009 compared to a $9.55 million loss for the same period last year and includes a $4.3 million unrealised exchange gain (relating to currency movements on the USD convertible bond), a $3.8 million depreciation and amortisation charge and $2.6 million of interest expenses.
Total investment in mine assets was $279.3 million including a $14.6 million investment was made in mine assets during the period.
Chief executive Gordon Ward commented: “Once hydro-mining is underway in the July-September 2010 quarter, the typical export shipment size of premium hard coking coal will be approximately 60,000 tonnes. Once full production rates from hydro-mining are achieved, the mine is expected to produce an average of approximately 1 million tonnes of premium hard coking coal a year.”
The company is also to raise $50 million in an equity issue. The company had suggested in its quarterly report last October that it needed $20 million in working capital. Biggest shareholder New Zealand Oil and Gas will refinance its existing $US28.9 million ($42m) bond facility, if shareholders approve. NZOG is to subscribe to its 29.5% interest in the rights issue and will also have a two-year option to buy Pike River coking coal at annually-negotiated market prices up to the existing un-contracted amount of coal to March 2013 and up to 30% of annual production for the rest of the mine’s life. Pike River said this would not affect contracts with Asian customers and it would still be able to sell on the spot market.
The new convertible bond will allow Pike River to repay its Liberty Harbor bond facility of $US27.5 million.
Last week Pike River despatched its first shipment of coal to India.
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