Over the past few weeks Coalspur has distinguished itself by performing a close impersonation of a diver plunging off the 10m board, with a few twists and turns on his way into the pool below.

From 18c at the start of May Coalspur hit a 12-month share-price low last week of 4.6c, a 74% decline over 22 trading days. It has rebounded a bit to around 5.6c, though that is cold comfort for most investors in the stock.

Few other coal companies can come close to the fall of Coalspur. Nor can many match Coalspur’s performance over the past three years as it has dived from a peak of $2.38 on January 17 2011, to last week’s all-time low.

The fall from the peak to the trough represents a 98% price plunge.

The reason The Hog has selected Coalspur for a nomination in the worst-performer stakes is that it was seen, until a few weeks ago, as the company most likely to defy the coal price decline and emerge as a profitable producer of high-quality Canadian thermal coal.

As recently as April 11 Coalspur was sufficiently confident of its Vista project in Alberta that it appointed coal specialist Sedgman as its new engineering, procurement and construction contractor.

There is no doubt the management team at Queensland-based Sedgman was delighted to get the Vista assignment, albeit over the dead body of the failed Forge Group that beat Sedgman to the gig last year.

Just how happy Sedgman was with the assignment can be seen in a statement filed by the engineering firm at the stock exchange last week when it noted a few problems and a few wins, including the Vista job, which would help the company “position itself for improving market conditions in the medium-term”

Why Sedgman said that on May 26 when Coalspur was already flagging a delay to Vista is interesting in itself.

Presumably a May 14 announcement from Coalspur (12 days earlier) that it “no longer intends to commence construction [at Vista] in June, 2014, due to delays in securing all financing and permits” was seen as a short-term blip.

Unfortunately for everyone involved the blip appears to be somewhat more serious because last Friday, May 30, Coalspur updated its May 14 statement with a stern warning about the company facing a few financial strains.

After noting that Vista remained an attractive development proposition Coalspur added these cautionary comments: “The company’s ongoing viability and its ability to continue with development work on Vista is subject to it raising additional capital”

Blame for the discovery that more capital was required was apportioned to the low price of coal, challenging debt and equity markets and “the company’s current share price”

“Coalspur is facing a substantial challenge in its attempts to secure full funding for the development of Vista,” it said.

“In the absence of being able to fully fund Vista, the company’s primary objective is to protect and preserve the value of the Vista asset.”

Talks continue with possible providers of the estimated $C458 ($A451) million to develop Vista into a 6 million tonne a year mine with the potential to double that output in later years.

In the meantime jobs are being cut and cash conserved.

In a way, what is happening at Coalspur should not come as a surprise. It is certainly not an orphan when it comes to being hit by the low coal price and the reluctance of bankers and equity investors to support a new coal project.

The importance of accessing a fresh source of cash was obvious in the company’s March quarter report when it noted a bank balance of $C4.19 million and forecast spending during this June quarter of $C10.2 million.

What is surprising is that some investors ignored the warning signs and continued to invest in Coalspur as conditions deteriorated, perhaps in the belief that management would be able to pull a funding rabbit out of the hat.

Last week’s announcement was a sobering reminder that conditions in the coal sector are close to being the worst in living memory, if not the worst, which means most mine development activity is grinding to a halt.

For a company such as Coalspur, with high-class management connections and a high-class Canadian coal project, the share price dive into the cellar is an unpleasant experience and one that will deeply dismay many investors who had expected better.