a power station reflected in the water

Power plant seeks control of Indian-owned coal mine amid worsening crisis in WA

The Japanese owners of a major coal-fired power station in Western Australia have taken legal action to take over a loss-making mine from Indian ownership amid a worsening crisis in the state’s coal heart.

Bluewaters, which is owned by the Sumitomo conglomerate and backed by a group of so-called Wall Street vulture funds, said it was seeking boarding rights to take over the Griffin Coal mine near Collie, 180 kilometers south of Perth.

A court hearing between the clashing parties is scheduled for today in Perth.

The highly anticipated move follows years of instability at Griffin, which is owned by Indian interests and believed to have incurred losses of more than $1 billion in just over a decade.

It’s clear that Bluewaters wanted to take control of the mine after months of interruptions to the coal supply reduced supplies to generate electricity.

The 440 MW power station, Australia’s newest and only commissioned in 2009, is one of the largest generators in WA’s main power grid, which serves the southwestern corner of the state.

Bluewaters typically supplies up to 15 percent of the electricity generated in the system and sells it to major industrial customers, including the giant gold mine Newmont and state-owned companies.

However, data from the Australian Energy Market Operator, which operates the market in WA’s main grid, shows that the output of Bluewaters’ two units has fallen dramatically in recent months.

In a statement, Bluewaters confirmed it wanted to appoint a controller to run the Griffin Coal mine.

Final chapter in long-running saga

Griffin Coal in southwestern Western Australia has suffered losses and misery for a decade.(ABC news: Hugh Sando)

The Bluewaters decision is the latest twist on a tumultuous saga that began in 2010, when the business empire of former WA coal magnate Ric Stowe collapsed.

Mr. Stowe had built the power station in an effort to extend the life of his Griffin Coal mine, but he was forced to sell both assets through trustees when debt burdens crippled the company.

While Indian firm Lanco Infratech paid $730 million for the mine in 2011, Sumitomo along with Japanese conglomerate Kansai reportedly paid $1.2 billion for the power plant.

Both investments have come back to haunt the owners.

The mine, now owned by Indian bank ICICI after Lanco’s implosion, is said to have lost money almost every year since it was taken over by Indian interests.

In the meantime, Sumitomo and Kansai wrote the value of the Bluewaters power station to zero in 2020 as a renewable energy attack and coal supply problems took their toll.

In a further intrigue earlier in 2020, a syndicate of Australian and foreign banks, including Westpac and ANZ, reportedly refused to refinance $370 million in Bluewaters’ debt over concerns about the facility’s security of coal supply and investments in the facility. fossil fuel.

Instead, the banks sold their debt holdings at a discount to distressed debt specialists — so-called vulture funds — including Oaktree Capital and Elliot Management.

Those firms have never publicly commented on their intentions for Bluewaters, which faces an increasingly uncertain future after the state government said it would not renew contracts that would take up half of the plant’s production.

Standard Griffin Coal: Bluewaters

A Bluewaters spokesperson said the company was exercising its rights to ensure a stable and safe supply of coal.

“This action follows Griffin’s failure to meet its contractual obligations to Bluewaters, due to its continued inability to supply coal in the quantities specified in the supply agreements,” the spokesperson said.

Griffin has filed a petition with the court for an injunction against the appointment of a controller and the case is expected to be decided by the court in the coming days.

“The rationale of the controller’s appointment is to enable additional capacity and funding to restore full coal supply to Griffin’s customers from its Ewington mining operations in Collie.

“The controller will work closely with Griffin’s employees and contractors to return operations to a safe, stable and productive mine.”

#Power #plant #seeks #control #Indianowned #coal #worsening #crisis

Leave a Comment

Your email address will not be published. Required fields are marked *