West Coast specialist coking coal mine developer Bathurst Resources has bought a small thermal coal mine near Christchurch.
The company has been unable to start mining at its Denniston Plateau development because of multiple legal challenges to council consents it was issued almost two years ago.
Bathurst has purchased several small operating coal mines around the South Island, including the Cascade mine, next to the Denniston Plateau, for domestic sales.
It bought Canterbury Coal Ltd, which has an open pit thermal coal mine near Coalgate about 70km west of Christchurch, for up to $600,000, and signed a three-year deal to supply up to 55,000 tonnes of coal annually to a dairy processing plant.
Bathurst managing director Hamish Bohannan said while annual mine production would start at 50,000 tonnes, he forecast it would grow ''over the next few years'' to 100,000 tonnes to meet Canterbury's dairy and industrial demand.
''The proximity of the mine to these markets gives us a distinct freight advantage over our competitors to target this growth potential,'' he said in a statement yesterday.
The mine's thermal coal was in high demand from local and dairy food processors because of its low sulphur and ash content, he said.
Recent drilling by Canterbury Coal identified an estimated coal resource of 3.3 million tonnes.
Bathurst is also negotiating for a 50% stake in Rolleston's Kenroll Coal Yard to provide a consented coal yard, plant and equipment, weighbridge, and screening facilities.
The company and assets purchase is conditional on consent to assignment of several permissions, and also the Minister of Energy and Resources agreeing to the permit transfer.
Following several court judgements in its favour, Bathurst is edging towards the start of mining around the Denniston Plateau by the end of the year.
However, Forest and Bird could yet appeal the latest decision, judgements on related issues are pending from the Supreme Court and Court of Appeal, and permission for road access to the plateau must be granted.
