RISING coal prices have not saved the jobs of about 200 mineworkers who finished on Thursday at Anglo American’s Drayton coal mine near Muswellbrook.
The South African-founded London-listed company announced in February that it was selling its Australian coal mines as part of a shakeup it said would improve cash-flow and cut debt.
Coal prices were tanking at the time and Anglo had also been unable to gain approval for its Drayton South project, which it said would have saved the jobs of the mine workers retrenched this week.
The Drayton South proposal will again be examined by the Planning Assessment Commission, with two days of public meetings in Muswellbrook next month.
An Anglo spokesperson said on Friday that even if Drayton South was approved, it was highly unlikely to be run by Anglo because of the February decision to exit Australian coal. The spokesperson said about 40 people were still at Drayton, working until “well into 2017” on rehabilitating the mine. Coal was still being rail-hauled from the mine to the Port of Newcastle, but the stockpile would go “very quickly”.
Prices for the Hunter’s main coal product – thermal coal for power stations – have risen from about $US50 ($65) a tonne to about $US78 ($102) a tonne this year, while prices for higher priced steel-making coking coal have risen even further.
Although the deal is yet to be finalised, the rise in coal prices mean that Nathan Tinkler and his associates may have struck with perfect timing in buying the Dartbrook mine from Anglo. Although Mr Tinkler is no longer on the board of Australian Pacific Coal, his companies retain significant shareholdings.
In an echo of former deputy prime minister Mark Vaile joining the board of Aston Resources when Mr Tinkler was developing Maules Creek, Australian Pacific Coal has appointed a former chief minister of the Northern Territory, Shane Stone, as a non-executive director.
Although Australian Pacific Coal’s share price has stayed at similar levels in recent months, other small mining companies that have bought discarded mines from major players have already profited. Queensland producer Stanmore Coal has seen its share price go from 5 cents in June last year to 62 cents this week.
Economists say higher coal and iron ore prices should dramatically improve the federal budget’s bottom line. The improved market has also lifted volumes sold out of Newcastle, with 119 million tonnes rail-hauled to the port in the first nine months of 2016, compared with 117 million tonnes in the same period last year.
The coal industry has used the price rises to hit back at critics who said coal was in terminal decline.