Aquila's Isaac Plains sale draws closer

AQUILA is a step closer to offloading its 50% stake in the Isaac Plains coal mine in Queensland for $430 million after receiving approval from the Foreign Investment Review Board.
Aquila's Isaac Plains sale draws closer Aquila's Isaac Plains sale draws closer Aquila's Isaac Plains sale draws closer Aquila's Isaac Plains sale draws closer Aquila's Isaac Plains sale draws closer

Aquila's Isaac Plains mine.

Lauren Barrett

The Isaac Plains open cut mine east of Moranbah is an equal joint venture partnership with Brazilian giant Vale.

But the project became marred with difficulty after the JV partners were caught up in a bitter dispute over product loading arrangements at the mine.

The dispute was patched up in March after the companies extended a “lifting agreement” from the mine which was originally due to expire.

In early April, Aquila Resources subsidiary IP Coal announced it would sell its half share in Isaac Plains to Ocean Coal Mining, a wholly owned subsidiary of Japanese giant Sumitomo Corporation.

On Wednesday, Aquila said the FIRB did not object to Sumitomo Corporation taking Aquila’s 50% stake in the mine.

Aquila intends to sell its share in Isaac Plains so it can gain funds to construct its coal and iron ore assets.

Offloading its stake in Isaac Plains will also help the company secure two-thirds of the equity funding required for construction of the West Pilbara iron ore project in Western Australia once its 24.5% of the Belvedere coal project sale is concluded.

The transaction is dependent on Vale Australia now exercising its 60-day pre-emptive right to acquire the stake.

Isaac Plains has a production capacity of 2.8 million tonnes per annum and produces a mix of metallurgical and thermal coals.

In more Aquila news, the company reported a 268 million tonne JORC-compliant resource at its Wilpeena pulverised coal injection project in Queensland’s Bowen Basin.

Indicated resources of the Rangal coal measures stand at 28.8Mt while the inferred resource stands at 164.1Mt.

Aquila said initial quality testing indicated the Rangal coal measures would produce a PCI product.

A total of 32 holes have been drilled on the tenement, with 18 of the holes suitable for modelling purposes.

Established infrastructure is in close proximity to the project, with the Capricorn Highway and the Blackwater rail system located about 50km from the project.

Aquila is planning to undertake further exploration work at the tenement to further delineate the resource and determine detailed coal quality.

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