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While NZOG will retain a 65% majority stake in Pike River Coal Company (PRCC), India’s Saurashtra Fuels Private (SFL) will acquire a 10.6% stake through investment of $NZ17 million.
NZOG will commit the remaining $NZ23 million, $NZ6.9 million immediately.
The remaining development cost of up to $NZ30 million will be funded by PRCC’s proposed initial public offering, planned for March 2006.
Pike River, near Greymouth on New Zealand’s south island, will produce 1.2 million tonnes per annum, recovering 20Mt of premium hard coking coal.
The proposed mine will use hydraulic (high pressure water) extraction and continuous mining.
PRCC general manager Gordon Ward said SFL will purchase at least 150,000 tonnes per annum of Pike River’s coal for the entire mine life at market price. A SFL representative will also be appointed to the PRCC board to assist in marketing Pike coal in India.
