Pike River Coal has conceded that it has no choice but to call in the receivers. Despite the deaths of 29 miners following an explosion on Nov. 19, it was hoped the mine could still be brought back into operation.
Chairman of Pike River Coal, John Dow, said that a sequence of explosions followed by a coal fire at the mine had destroyed business plans the company had put together for the next few months.
“The only prudent action we could take was to approach our major creditors and advise them we were unlikely to be able to repay our loans at the end of the standstill period that New Zealand Oil and Gas (NZOG) and Bank of New Zealand (BNZ) offered us after the 19th of November,” Dow told ONE News.
While acknowledging that its future was questionable, Pike River Coal was focusing on the recovery effort and ensuring the conditions in the mine were safe, assisting with the enquiry and worker entitlements, he said.
New Zealand Oil & Gas, which owns 29 percent of Pike River Coal shares, has seen the value of its shares drop by 30 percent since the explosions.
According to Martin Allison of Craigs Investments Partners, shareholders could end up with negligible or zero returns.
“It’s unfortunate and not a good outcome for Pike River Coal,” Allison told ONE News. “But it’s probably a reasonable step for New Zealand Oil & Gas.”
Chairman of Pike River Coal, John Dow, said that a sequence of explosions followed by a coal fire at the mine had destroyed business plans the company had put together for the next few months.
“The only prudent action we could take was to approach our major creditors and advise them we were unlikely to be able to repay our loans at the end of the standstill period that New Zealand Oil and Gas (NZOG) and Bank of New Zealand (BNZ) offered us after the 19th of November,” Dow told ONE News.
While acknowledging that its future was questionable, Pike River Coal was focusing on the recovery effort and ensuring the conditions in the mine were safe, assisting with the enquiry and worker entitlements, he said.
New Zealand Oil & Gas, which owns 29 percent of Pike River Coal shares, has seen the value of its shares drop by 30 percent since the explosions.
According to Martin Allison of Craigs Investments Partners, shareholders could end up with negligible or zero returns.
“It’s unfortunate and not a good outcome for Pike River Coal,” Allison told ONE News. “But it’s probably a reasonable step for New Zealand Oil & Gas.”
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