Bowen Coking Coal enters voluntary administration
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The news: Financially distressed coal producer Bowen Coking Coal has appointed voluntary administrators from McGrathNicol Restructuring after it was unable to pay its two largest creditors BUMA Australia and the Queensland Revenue Office.
The numbers: Bowen previously told the market it was not in a position to pay BUMA’s total claims of $29.3 million and the $14.4 million in royalty payments owed to the Queensland Revenue Office (QRO).
The context: Bowen was not able to secure fresh capital from its senior secured lender or negotiate alternative commercial agreements with BUMA or QRO.
The decision to appoint administrators was taken after QRO on 29 July rejected the latest request for a short-term deferral of royalties. An initial request sent through subsidiary New Lenton Coal was rejected earlier this month.
The decision to enter administration by Bowen’s board “reflects the current challenging environment for the coal industry in Queensland from higher costs, lower global coal prices and higher royalty rates introduced by the Queensland Government in 2022”, according to a statement to the exchange.
Mark Holland and Shaun Fraser of McGrathNicol Restructuring have been appointed as voluntary administrators. The process will “provide a window” that allows for the sale or recapitalisation of the Burton Mine Complex.
The source: ASX
