Bundoora closure a blow to Bounty

ANGLO American will place its Bundoora mine at the German Creek complex in Queensland on care and maintenance, causing mining contractor Bounty Mining to forfeit 25% of expected revenue from the mine for the 2012 financial year.
Bundoora closure a blow to Bounty Bundoora closure a blow to Bounty Bundoora closure a blow to Bounty Bundoora closure a blow to Bounty Bundoora closure a blow to Bounty

Image courtesy of Bounty Mining.

Lou Caruana

Anglo American has also informed Bounty that the Aquila portion of the contract has now been converted from a production operation to a longwall development operation using the same employees and equipment included in the current contract for the Aquila mine.

This is not expected to have any financial impact on Bounty, it said.

“Bounty had previously advised the market that, under the contract with Anglo American, mining at Bundoora was due to commence in August 2011,” Bounty said.

“With the decision to place the mine on care and maintenance, commencement of mining at Bundoora is now deferred indefinitely. It is expected that the period of deferral will extend beyond the period of the current contract, which runs until July 2012.”

The news comes as a blow for the troubled Bounty, which is seeking to upgrade its second fleet and organise a capital raising to pursue other contracts in the underground mining sector.

“Bounty is exploring opportunities with Anglo American for future development work at the German Creek complex which could in part replace the anticipated revenue,” it said.

“This is likely to include a proposal by Bounty to introduce a second development unit into the Aquila mine after June 2012 with a possible extension of the current contract.

“In addition, the company continues to seek new contracts in anticipation of the upgrade of the company’s second fleet after the proposed capital raising is completed.”