A consortium led by contracting company RStar and including staff at the mine is preparing a bid to buy the Tahmoor coal mine from billionaire Sanjeev Gupta’s parent company.
RStar has partnered with GBA Capital to produce a bid for the closed New South Wales-based coking coal mine, ABC News reported.
The mine has been closed since February after it ran out of cash, as the mine got caught up in the financial turmoil around Gupta’s GFG Alliance.
The New South Wales government also placed a restriction on the company’s mining leases to secure outstanding royalties.
RStar’s legal representative, Olivia Hitchens, principal at Artemide Law, said the consortium was moving quickly to place a bid on the mine to ensure that the contracted workforce would remain.
“RStar’s workforce is a contracted workforce that would remain, as would the existing workforce … our proposal also carves off a piece of the pie for management to participate as equity owners,” she said.
About 500 workers were stood down on minimum pay since the mine closed, and in November, about half were told they would no longer be paid.
William Buck, the appointed administrator of Liberty Primary Metals Australia, released a creditors’ report that found tens of millions were borrowed against Tahmoor to support a failed US$1 billion project to shift an electric arc furnace from South Korea to Romania.
Administrators said they had received letters of interest from third parties in acquiring Tahmoor Coal.
The RStar consortium has asked analysts to assess the mine’s assets and future potential after it conducted a tour of the mine with management.
Hitchens said the mine’s management has a clear plan to reopen the mine.
However, the situation is very complicated with regulatory approvals and the state government’s decision to remain a secured credit still unresolved.
“There is a lot of hope here, and hopefully governments, unions, investors and powers that be [will] back our consortium and can move quickly, because it is a great asset — a really solid asset.”