Solid Energy keen on Pike River but says mining years off

16:00, Mar 14 2011

New Zealand's largest coal miner Solid Energy has signalled a bid for the Pike River coalfield but warns preliminary work ahead of coal extraction could take years and cost up to $100 million.

Chief executive Don Elder said Solid Energy has confirmed its interest in Pike River and was "almost certainly the only company with the credibility, knowledge, experience and track record to mine the resource safely and economically".

Bids from competitors would almost certainly emerge, with "aspirational" claims from some, but these needed to be taken with a grain of salt, he said.

The West Coast mine was one of the most challenging coal resources in the world to develop with further substantial exploration needed.

"The existing mine assets may not form a significant part of any future mining operation, leaving only the coal permit and access agreements as the primary assets of value," Mr Elder said.

State-owned Solid Energy, if successful with a bid, would probably look to develop the mine in a joint opencast/underground approach. It would need to get part of the surrounding land removed from schedule 4 protected conservation land for opencast mining. Access would be difficult and so would resource conditions.