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Allens and Corrs fire up coalmine deal
Rio Tinto has agreed to sell its interest in a Queensland coalmine.
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Firms: Allens (Rio Tinto); Corrs Chambers Westgarth (Linc Energy/New Emerald Coal)
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Deal: Rio Tinto has agreed to sell its interest in the Blair Athol mine to New Emerald Coal, a subsidiary of Linc Energy
Area: Energy & Resources / M&A
Value:Undisclosed
Key players: Partner Erin Feros (pictured) led the Allens team, which also included special counsel Glenys Hodges, senior associate Tracey Davern and lawyer Caitlin Wilson. The Corrs team was led by partners Bruce Adkins and Jack de Flamingh and supported by special counsel Stuart Clague and senior associate Nick Thorne. The Corrs team worked closely with Linc Energy’s general counsel (corporate) Brook Burke and legal counsel Romana Price
Deal significance: The Blair Athol mine, located in Queensland’s Bowen Basin region, is owned by the Blair Athol Coal Joint Venture (BACJV) and managed by Rio Tinto Coal Australia; it has been inactive since the BACJV ceased mining there in November 2012, after 30 years of operation.
The BACJV has entered into a conditional Sale and Purchase Agreement with New Emerald Coal (NEC), a subsidiary of ASX-listed Linc Energy. The transaction will result in the transfer of the mining tenure, certain on-site assets and infrastructure and environmental obligations. According to the terms of the sale, the BACJV will make an agreed financial contribution towards the rehabilitation obligations being assumed by NEC. Linc has announced that it will re-open the mine once the acquisition becomes unconditional and the tenure has been transferred. NEC expects the acquisition to become unconditional within six months and mining to recommence shortly thereafter. This will create more than 100 jobs and will enable NEC to produce up to three million tonnes of thermal coal per year.
Under the Sale and Purchase Agreement, there is also provision for NEC, as owner of the Blair Athol Coal Mine, to enter into a number of infrastructure-sharing arrangements with the owners of the nearby Clermont Coal Mine. Corrs partner Bruce Adkins said: “Corrs was delighted to assist Linc and New Emerald Coal with this transformative deal, which will be integral to New Emerald Coal’s emergence as a significant player in Queensland’s coal industry.” Lead Allens partner Erin Feros commented: “We always enjoy working with our colleagues at Rio Tinto and this transaction was no exception.”
