The fate of Bowen Coking Coal is in the hands of voluntarily-appointed administrators, but its board is hopeful a recapitalisation or sale of the business are still possible.
Voluntary administrators Mark Holland and Shaun Fraser, of McGrathNicol Restructuring, were appointed on July 30, after the Queensland Revenue Office (QRO) rejected a revised request for a deferral of royalties on July 29.
This came after the state’s tax authority rejected Bowen’s initial proposal on July 23.
The QRO and mining services provider BUMA Australia are the two largest creditors of Bowen Coal and its related entities.
It is understood that BUMA operated the Bowen’s largest asset, the Burton Mine Complex, for two years ending June 30. Bowen has since been operating its mines itself, under an owner-operator model.
BUMA claims it is owed over $15 million, although Bowen has noted that part of that sum is disputed. On July 16, BUMA made a statutory demand, requiring payment of close to $7 million within three weeks.
Bowen’s shares have been suspended from trading on the ASX since June 26.
The board said it was disappointed to have to appoint administrators after failing to come to any agreement with either BUMA or the QRO.
“The board’s decision also reflects the current challenging environment for the coal industry in Queensland from higher costs, lower global coal prices and higher royalty rates,” Bowen said in a statement to the ASX.
“The Burton Mine Complex is a quality asset, and management has been successful in delivering operational improvements that have seen (it) transform into one of the most productive and low-cost metallurgical coal mines in Australia.”
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