Bowen Coking Coal enters voluntary administration
Bowen Coking Coal has entered voluntary administration, a move that has heightened concerns regarding the future of the coal industry in Queensland, Australia, and the security of more than 500 jobs at the Burton Mine near Moranbah.
The company had previously sought a royalty deferral from the Queensland Revenue Office, which was rejected on 29 July.
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Mark Holland and Shaun Fraser of McGrathNicol Restructuring have been named the voluntary administrators.
“The administration process is expected to provide a window which will allow for a sale or recapitalisation to be completed,” the company said in a stock exchange filing.
Bowen Coking Coal has attributed the introduction of Queensland’s high royalty rates, peaking at 40% in 2022, as a factor impacting the profitability of coal producers in the state, stated mining.com.au.
The royalty regime, which was introduced during a period of record coal prices spurred by the Covid-19 pandemic, has been maintained by the new Queensland Government under Premier David Crisafulli.
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By GlobalDataDespite being more aligned with the resource industry than its Labor predecessor, the government has chosen to keep the royalty rates unchanged, with many state spending measures depending on the revenue generated from these royalties.
Over the past three years, global uncertainty and challenging operating conditions have affected the viability of coal companies along Australia’s eastern seaboard. The Australian newspaper highlighted the administration of Dartbrook Mine, owned by Australian Pacific Coal and Tetra Resources, earlier this month due to debt issues.
Glencore has declared its Mount Isa copper smelter in Queensland unsustainable and is seeking support from state and federal governments to continue operations, reported Reuters in June.
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