2 Feb 2018

Solid Energy payments to creditors increasing

6:59 pm on 2 February 2018

New information shows payments inching up for creditors of the failed former state coal miner Solid Energy.

Last September the company said they would get 60 cents in the dollar, but the company has now confirmed they will get 62 cents.

The Bathurst Resources-Talleys consortium paid $46 million for a big chunk of Solid Energy last year.

It undertook to pay up to $50m more if it was able to trade profitably because of rising prices for coal.

Those prices have duly risen, and the first tranche of the extra payments - $6 million - was made to creditors yesterday.

Solid Energy chief executive Tony King said if the price of coal stays up the company would be able to pay a total of 13 cents more in the dollar, taking final payments up to 75 cents in three and a half years from now.

He said creditors would have got just 15 to 20 cents if the company had been liquidated as proposed in 2015.

The price of coal for steelmaking has risen substantially since the company failed.

'Operation Lightswitch'

Solid Energy collapsed in 2015 owing $380m in debt.

Most of its assets have been sold, and a few that could not be were shut down.

The remnants of Solid Energy will formally go out of existence in March, under a plan nicknamed "Operation Lightswitch."

There are nine people still working for the company, five of who are employed to maintain the site of the Pike River Mine.

They will transfer to a new agency being set up by the government to oversee a re-entry to that mine under a pledge by the new government.

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