Major mine sale raises eyebrows amid $3.9bn WICET trouble

MINER TROUBLE: The remaining owners of WICET are under stress to repay $3.9 billion to 19 lenders.
MINER TROUBLE: The remaining owners of WICET are under stress to repay $3.9 billion to 19 lenders. Mara Pattison-Sowden

WIGGINS Island Coal Export Terminal's major owner Glencore has placed its Rolleston coalmine in the Bowen Basin up for sale.

The decision is part of Glencore's ongoing program to optimise its portfolio and redeploy capital into other opportunities.

The announcement follows fears for Glencore and the four other miner owners of WICET who have $3.9 billion of debt hanging over their heads.

The Australian reported the sale could be a move by Glencore to improve its negotiating position with WICET's lenders, advised by McGrath Nicol.

In a statement released this week the company said it would sell the Rolleston mine if they receive an offer that "delivers value for our shareholders".

"The Rolleston mine is a high quality asset that offers potential buyers the opportunity to gain a strong foothold - or significantly increase their current position - in the Australian and Queensland coal industry," the company said.

The five coal export terminal owners are attempting to negotiate a new funding model for its 19 lenders, instead of the original "take or pay" agreement.

Since opening in 2015, three of the original WICET owners - Bandanna Energy, Caledon Coal and Cockatoo Coal - have collapsed and the coal price has plummeted.

Demonstrating the rising costs for WICET's owners, a Caledon Coal administrator's report said the terminal's handling charge rose from A$14.16/t in 2016 to A$21.83/t in 2017.

Caledon's exposure to WICET's debt was one reason the coal miner cited for its collapse earlier this year. The Rolleston asset is one of Glencore's 24 mines in Australia, including four coal mines in Queensland.

Glencore has hired BAML's Merril Lynch for the sale of the open-cut mine. The Rolleston mine produced 13.3 million tonnes of saleable coal in 2016 of Glencore's total 93 million tonnes produced.

Topics:  gladstone industry wicet

Stay Connected

Update your news preferences and get the latest news delivered to your inbox.

All's Wells for Madi after third national silver medal

RISING STAR: Lockyer District Athletic Club's Madison Wells celebrates her latest silver medal success with mum Sharyn and dad Lee in Melbourne.

Madison Wells won silver at the Australian Multi-events titles.

Bid on hot cross buns to help raise funds

GOING HOT: The Old Fernvale Bakery aim to raise $40,000 for the Lady Cilento Childrens Hospital by donating $1 from every pack of hot cross buns sold. Pictured here are Lyn and Bill Rose with the latest hot cross bun creation, cranberry, pistachio and white chocolate.

Help the Old Fernvale bakery get over the line.

Home Affairs visits Gatton

HELPING HAND: Department of Home Affairs staff Michael and Zepphorah at the department's visa outreach event in Gatton on Tuesday.

Immigration visits Gatton to advise on visas

Local Partners