16/11/2010 - 11:22

Bathurst completes $35m New Zealand deal

16/11/2010 - 11:22

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Perth-based Bathurst Resources has agreed to pay $35 million to buy another coal project in New Zealand's Buller region.

Perth-based Bathurst Resources has agreed to pay $35 million to buy another coal project in New Zealand's Buller region.

Bathurst will acquire Eastern Resources Group from Galilee Energy.

The purchase will increase Bathurst's Buller coal resources by 55 percent, consolidating its Buller permits with Eastern's Whareatea West exploration permit.

The Whareatea project is in the middle of Bathurst's Denniston plateau project. It would bump up Bathurst's coal resource from 47.1m tonnes to 72.8m tonnes and could extend the mine life by over a decade to about 30 years, said Bathurst managing director Hamish Bohannan.

"As far as Eastern's concerned, it's business as normal," he said.

"No changes there, no changes to jobs or anything else, no changes to profile. But what it does do, it means we've got a much more substantive project on the Buller plateau."

Bathurst will also gain two operating mines -- Cascade in Buller and Takitimu in Ohai, Western Southland -- giving it immediate cash flow.

Cascade produces about 40,000 tonnes of coal a year, most sold under contract to the Cape Foulwind cement works.

Takitimu produced 160,000 tonnes last financial year, mostly for the Fonterra-operated Clandeboye milk processing plant.

Bathurst is seeking regulatory and New Zealand government approvals for the Eastern purchase, which it expected to complete late this year or early next year. It has already paid a non-refundable deposit of $2.4 million to Galilee.

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