As Solid Energy's 1,200 staff await the latest restructuring details and whether it needs a Government bailout to survive, listed coal mine developer Bathurst Resources Ltd (ASX & NZX: BTU) is forging ahead with further South Island acquisitions.
Bathurst is to pay L&M Coal Holdings Ltd $16.8 million for a 658 hectare tenement at Takitimu in Southland, adjacent to its Takitimu mine, for production of domestic thermal coal.
Last July Bathurst purchased the Takitimu operations of Eastern Coal Ltd from Brisbane-based Galilee Energy for $A14 million ($NZ17.2 M), which at the time was producing about 175,000 tonnes of coal per annum.
While the coal industry is still reeling from last week's disclosure of Solid Energy's precipitous financial position, Bathurst's operations remain mired in litigation, with only small-mine coal production underway on the West Coast and the Takitimu operations in Southland.
Bathurst - which wants to begin substantial opencast mining of specialist hard coking coal on the Denniston Plateau near Westport - is awaiting the outcome of Environment Court challenges to its resource consents on the Escarpment leases.
After having spent more than $120 M and being almost a year behind schedule, Bathurst's share price has borne the brunt of frustration, having declined from $1.10 almost a year ago to trade around 40c recently.
Last year Bathurst had about $150 million in cash and banking facilities available, plus income of more than $30 M from boutique mine coal sales, out of Southland and the small Cascade coking coal mine adjacent to the Denniston Plateau.
In July 2011, Bathurst paid $US12 M ($NZ14.4 M) to expand its Denniston Plateau holdings, by a further 341 ha, acquisition of the consented Coalbrookdale leases from Brookdale Mining Ltd.
*Simon Hartley is senior business reporter for the Otago Daily Times.