7 Sep 2016

Buller coal project 'definitely not dead'

12:09 pm on 7 September 2016

Bathurst Resources plans to talk to stakeholders about its coal project on the Denniston Plateau, inland from Westport, now prices are on the rise.

Bathurst Resources plans to mine this area of the Denniston Plateau.

Bathurst had put the Denniston Plateau mine on hold because the low price of coal made it uneconomic. Photo: Debs Martin

The company received its last approvals for the project two years ago after a marathon legal battle with environmental opponents, but later put the mine on hold storage because the price of coal fell so far that the project became uneconomic.

Similar problems sent rival Solid Energy into bankruptcy.

Coal prices have since turned around, and the best grades have gained over 50 percent in price since February.

Bathurst Resources chief executive Richard Tacon has sounded a positive note at a mining conference in Wellington.

"The Buller Project is definitely not dead, especially with the coal price heading (upwards)" he said.

"I think the spot price today was $158 [a tonne], and we are doing some cashflow modelling around that now.

"With a view to that coal price, we anticipate talking to our major stakeholders in the very near future."

Mr Tacon added a caveat, saying he still wanted to make sure higher coal prices were sustained.

The recent rise in prices have brought confidence over the assets of defunct Solid Energy as well as to Bathurst Resources.

But the sustainability of that revival has been questioned by experts, who say it is based on disruption in China, and might not last.

Get the RNZ app

for ad-free news and current affairs