Aquila has issued BCC with a default notice under their joint venture agreement after BCC did not support committing to the infrastructure arrangements. BCC does not agree it is in default.

“As the relevant agreements were not executed and returned to the relevant counterparties by the deadline, capacity on the GAPE rail project and at the Abbot Point Coal Terminal have not been secured by the joint venture,” Aquila said in a statement today.

“Aquila Coal will continue to investigate the infrastructure opportunities available to the joint venture. While Aquila Coal will continue to seek to resolve this matter with BCC, in the meantime it will pursue its rights under the Bowen Central Coal Joint Venture Agreement, in respect of the default notice it issued on BCC.

First production from Eagle Downs could be pushed back by two years if the plan to export out of Abbot Point is not approved, Aquila says.

It wants to export out of Abbot Point and commit to partially funding the Goonyella Abbot Point expansion project to link Eagle Downs to the port, but Vale has proposed alternative plans.

“The main issue in question is the development of Abbot Point with the certainty of first production in 2013 compared to the Dalrymple Bay option with first production in 2015,” an Aquila spokesperson told International Longwall News.

A Vale spokesperson confirmed Vale and the joint venture partners held different views over the logistics for Eagle Downs.

Aquila’s shares were up by 4.12% to $9.86 this morning.