A coal mine in Queensland that reopened only eight months ago has called in administrators after running into financial strife and boardroom upheaval.
Administrators from BRI Ferrier were appointed to entities within the New Wilkie Energy Group two days after Christmas. Entities in administration include the company overseeing its Wilkie Creek coal mine in the Surat Basin, about 250 kilometres west of Brisbane. BRI’s Andrew Cummins, Jonathon Keenan, Peter Krejci and Stefan Dopking have taken over operations and the mine is still running. They are examining whether to sell the mine or set up a debt restructuring deal.
“Our initial inquiries indicate that there may be a viable business remaining to save or restructure,” they said in an initial report to creditors, seen by The Australian Financial Review.
The financial turmoil comes after prices for thermal coal, used to generate electricity, fell from highs of almost $US400 a tonne in the latter half of 2022 to almost $US170 in May last year. Queensland budget papers forecast an average price of $US153 in the current financial year, which is still higher than the 2019 average of $US75 a tonne.
In 2021, New Wilkie Energy bought the mine from Peabody Energy, which itself had mothballed the operation in 2014 and had tried to sell it to different parties including Nathan Tinkler.
The new privately owned venture restarted the mine in April last year, and it was part of a vision for the group to “become an Australian energy producer that offsets the carbon emissions inherent in the coal business with large-scale renewable energy projects over the longer term”. It would have used former mining areas at Wilkie Creek for a solar-energy project.
The mine employs more than 200 people – many contractors – and the mine operating company has about 30 staff.
The coal mine was forecast to churn out 2.4 million tonnes of coal annually, shipped to Asian markets. The company had indicated progress was being made, and a newsletter in September said a new modular plant was processing up to 1600 tonnes a day.
But Queensland legal records indicate the New Wilkie Creek Energy mine entity had gone to court three times since June last year to set aside statutory demands from other companies. Under the administration, legal proceedings are stayed.
BRI’s administrators are examining how the mine ran into difficulty, and will investigate areas such as contracting and start-up costs. New Wilkie’s head group entity is not in administration.
The companies in administration include New Wilkie Energy Pty Ltd, which is the main asset holding and operating entity. The other entities were not trading, BRI’s report said.
Company searches show a flurry of director changes in December before the administrators were appointed. That includes two directors of the New Wilkie Energy mine entity departing in December, one of them the head group company’s managing director, Gary Williams.
Mr Williams, who has more than 40 years’ experience in the sector including in Africa and North America, is still listed in company searches as a director of the main entity, but his profile has been removed from the company’s website. Mr Williams declined to comment on Wednesday. Sources with knowledge of the situation said upheaval with an investor had resulted in boardroom changes.