Solid Energy's briquette plant south of Mataura has been sold to Australian-based company GTL Energy.
Solid Energy spokesman Bryn Somerville said construction of the plant began in late 2011. It took about a year to complete at a cost of about $29 million. Although it was commissioned, it never produced briquettes for the commercial market.
Mr Somerville declined to say how much the plant had sold for, saying the information was confidential. The sale was finalised last month.
An agreement was reached early last year that GTLE Development Ltd, a joint venture between Solid Energy and GTL Energy, would operate the Mataura plant.
It used GTL Energy's coal upgrading technology.
GTL director Blake Williams, who is based in Australia, said earlier this week the plant was in standby mode while the company reviewed its options for future use. It was still in the early stages of investigating how it would proceed.
Only one staff member remained at the plant. GTL Energy developed technology to remove moisture from low-rank coals, Mr Williams said.
The company's focus was on developing markets in the Asian region. The upgraded product was suitable for use in thermal power stations. GTL Energy also had a pilot plant in Colorado in the United States and a demonstration plant in North Dakota. Mr Williams said the company had viable technology and it was pursuing markets despite a global downturn in coal prices.
''In certain markets the economics still work.''
The raw product prices were still low.
Mataura Community Board chairman Alan Taylor said the community was disappointed when the briquette plant did not go into commercial production as planned. It created uncertainty about the plant's future. It would be good for the community if GTL Energy made use of the plant and created more employment opportunities, he said.
Clutha-Southland National Party candidate Todd Barclay said the sale of the plant was positive for Mataura.
Mr Barclay hoped it continued as an ongoing business and the new owners saw the potential in expanding the business and providing employment for local people.
If the business grew, it had the potential to provide economic flow-on effects for industries such as transport, maintenance and servicing companies.
Gore Mayor Tracy Hicks said the whole process, involving the state-owned coalminer's plans for developing lignite-based industry in Eastern Southland and ''the hype and hope'' turning to disappointment, had been unfortunate.
However, to get a company to invest in the plant was encouraging and if extra employment opportunities were created it would be good for the area.
''I guess it's a matter of watch this space,'' Mr Hicks said.
- The Ensign.
