Liquidation possible for CQ coal miner in $4bn debt, owes employees $22m
LIQUIDATION is possible for a collapsed central Queensland coal miner, a creditors' report has revealed.
Winding up Caledon Coal was recommended by administrator PPB Advisory at the last creditors' meeting.
The Cook Colliery mine owner and Wiggins Island Coal Export Terminal part-owner was placed into administration earlier this year with a debt of about $4billion.
It owes its employees $22million and WICET more than $24million, according to the report.
While attempts to sell the company's assets, including Cook Colliery, have been unsuccessful so far, eight "highly conditional” offers have been made.
PPB Advisory is negotiating with potential buyers to see if "any of these offers are better than the expected outcome in a liquidation”.
The company's failure forced 180 workers into redundancy from the Cook Colliery mine.
The report said Caledon workers - believed to be senior management - would receive their full entitle- ments and Cook Colliery workers would receive 52c in the dollar.
Chinese-state owned company, and Caledon Coal Group's owner Guangdong Rising Assets Management, stopped funding Caledon after a flooding event at the mine in March.
Aiding Caledon's demise was its part in the "take or pay” funding agreement with WICET.
There are concerns WICET and its miner owners are unable to repay nearly $4 billion to 19 lenders under the original contract.
The report stated Caledon's first payment of $1.5million to WICET was made on July 31, 2015.
Since then, a weakening coal price, higher charges at the coal terminal and two co-owners collapsing, have placed more pressure on those left in the deal.
The next creditors' meeting on Monday is expected to decide the fate of Caledon.
"It is our opinion that creditors' interests are best served by each company in the Caledon Coal Group being wound up (ie placed into liquidation),” the report states.