Junior coal scene heats up

LINC Energy will buy a 9.6% stake of South Africa-focused Firestone Energy, Stanmore Coal has signed up for significant capacity from Dudgeon Point and MetroCoal has landed more Chinese investment.
Junior coal scene heats up Junior coal scene heats up Junior coal scene heats up Junior coal scene heats up Junior coal scene heats up

The Coppabella coal mine in Queensland's Bowen Basin supplies 30% of the global pulverised coal injection market.

Blair Price

A savvy investor, Linc sold its undeveloped Galilee Basin thermal coal tenement to Adani Group for $A500 million in cash plus a royalties agreement a year ago.

The underground coal gasification and gas-to-liquids player has agreed to buy 150 million Firestone shares at 12c each in a $1.8 million placement which will give Linc about 9.6% of Firestone’s issued capital.

Aside from Firestone’s billions of tonnes of resources in the Waterberg coal region, Linc chief executive officer Peter Bond said some of the coal appeared suitable for Linc’s UCG and above-ground gasification processes.

Stanmore

Stanmore has struck conditional agreements for 12 million tonnes per annum of export capacity from the proposed Dudgeon Point terminal, next door to the Dalrymple Bay Coal Terminal, from 2016.

The explorer expects to split this capacity up among its Queensland projects, including 5Mtpa from the Tennyson project near Emerald, 5Mtpa from the Kerlong project near Moranbah and 2Mtpa from the Mackenzie project near Emerald.

Dudgeon Point is targeting 90Mtpa with construction slated to start in 2013 after the feasibility study is completed – and Stanmore is not required to commit funding for its capacity until after this milestone is reached.

A joint development between DBCT Management and Adani, Dudgeon Point requires various regulatory approvals.

Stanmore’s deal for 11Mpta capacity is also conditional on its board approval and an agreement on the port tariff.

“This transaction is complementary with our recent acquisition of 7Mtpa of priority capacity rights for Wiggins Island Coal Export Terminal Stage 2 terminal at Gladstone and puts us in a very strong position for our future port capacity requirements,” Stanmore managing director Nick Jorss said.

“We now have significant port capacity earmarked at the next planned coal terminals at both Mackay and Gladstone, Queensland’s two largest coal export hubs.”

MetroCoal

An explorer aiming to introduce longwall mining to Queensland’s Surat Basin, MetroCoal has made a $24 million share placement to major Chinese coal services group DADI Engineering Development.

The placement of 32 million shares at 75c each is expected to take place over two tranches, with the bulk of 28.8 million shares requiring Chinese government and MetroCoal shareholder approvals.

Should the deal go through, DADI is expected to hold a 15% stake of MetroCoal once the new shares start trading in mid-September and will also gain one seat of MetroCoal’s board.

SinoCoal, a subsidiary of China National Coal Group, is already a significant joint venture partner to MetroCoal.

In what was a fairly grim trading day on the ASX, shares in Firestone closed up 6.7% yesterday to 1.6c, Stanmore shares closed down half a cent to 89c and MetroCoal shares ended 2% down to 75c.

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