Peabody offloads mine
Newhope takes a big step toward mining hub in the northern Bowen Basin
Wednesday 06 September 2017
Peabody Energy has sold the recently mothballed Burton Coal mine North of Nebo to the Newhope Group controlled Lenton Joint Venture for around $14 million.
Following in the footsteps of other recent sales in the Bowen Basin, a large part of the actual cost of buying the mine comes through Newhope taking on significant liabilities associated with the cleanup costs of the mine in the future.
According to Peabody, the sale - if approved - will reduce their asset retirement obligation by approximately US$53 million while also releasing an estimated $30 million of restricted cash.
The Burton mine was entered into care and maintenance late in 2016.
The transaction is conditional on some regulatory and other requirements, and completion is expected to take place in the first half of 2018.
The Lenton Joint Venture controls the New Lenton Project between Hail Creek and the Burton mine. The project has a mining lease with environmental approvals for a 2 million tonne per year open cut coking coal mine.
In 2011, Newhope sold 10% of the project to Formosa Plastics Group a subsidiary company Mai-Lao Power Corporation.