West Coast miner: We're ready to hire

HAMISH RUTHERFORD
Last updated 05:00 06/09/2012

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Bathurst Resources is shrugging off the downturn in international coal prices and is ready to expand production near Westport if crucial resource consents are granted.

Last week, state-owned mining group Solid Energy blamed a downturn in international prices for the need to review its operations, including a suspension of operations at the Spring Creek mine near Greymouth.

Bathurst chief executive Hamish Bohannan said that although the price of coking coal had dropped by about US$100 (NZ$126) a tonne in 18 months, the size of the business meant it could still operate at that level.

"Our [financial] models allow for prices to go up and down," he said.

"Solid's a big company, with a lot of projects going on. It's a complex machine. We're much simpler; we're a single-focus company.

"If we were in operation today, our margins would be skinnier but that doesn't mean there's not a good future."

Bathurst has thermal coal operations in Southland but is focused on ramping up production of coking coal - used in steel-making - from the Denniston Plateau near Westport, to 1 million tonnes a year.

Bohannan told the Trans-Tasman Business Circle in Wellington yesterday that at this scale, the extraction price would be about US$85, compared with a current spot price of US$160-US$200 a tonne.

To ramp up production, Bathurst first needs to win an Environment Court hearing in October over its resource consent for the escarpment mine.

Domiciled in Australia but focused entirely on New Zealand, Bathurst has become a lightning rod for the environmental lobby, which claims mining Denniston will cause irreversible damage.

About 200 protesters gathered outside the official opening of the company's Wellington offices earlier this year.

As well as challenges to its resource consents, the company has faced a separate legal challenge from Forest & Bird as to whether climate change considerations should be applied to localised resource consents.

So far Bathurst has won cases in the Environment Court and the High Court, but Bohannan expected the matter to continue to the Supreme Court.

None of the challenges had deterred the company from operating here, he said, claiming Bathurst could provide a "net conservation gain" from its operations.

With Solid Energy's likely retrenchment, he expected "more focus" on Bathurst's investment plans in the coming months.

"There's a real opportunity for us to employ some people.

"We're ready to go now; we've just got to go through the hurdles, absolutely, of showing it's a net gain for the community."

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- BusinessDay.co.nz

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