Griffin Coal Explained

Place:Shire of Collie
Subdivision Type:State
State/Province:Western Australia
Country:Australia
Products:Coal
Owner:Griffin Coal Mining, a subsidiary of Lanco Infratech
Embedded:
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  1. C60C30
Stroke-Width:3
Marker:industrial
Marker-Colour:
  1. 1F2F57
Zoom:9
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Designation1:State Register of Heritage Places
Designation1 Offname:Bucryus Erie Dragline
Designation1 Type:Municipal Inventory
Designation1 Date:30 Apr 1996
Designation1 Free2name:Municipality
Designation1 Free2value:Shire of Collie

Griffin Coal is a large coal mine near the town of Collie in Western Australia, producing about 2.5e6t of coal annually.[1] In September 2022 its current owner, the Griffin Coal Mining Company, a subsidiary of Lanco Infratech, entered receivership.[2] In December 2022 the Western Australian government announced a granteffectively a loanto the receivers and managers of the insolvent mine to enable it to continue supplying the privately-owned Bluewaters Power Station over the Western Australian summer.[3]

History

The mine was in operation in the 1930s and was a supplier of coal to the Western Australian Government Railways, in competition with Newcastle Coal.[4]

In January 2011, the owner defaulted on debts of A$475 million, and sought outside buyers.[5] Two months later, it was acquired by the Indian firm Lanco Infratech for A$730 million. The logic of the purchase has been questioned in the business media, as the company has faced difficulties and has been forced to defer pension and other payments to suppliers.[6]

Since the purchase in 2011, major concerns have been raised about the financial viability of the mine. In 2016, workers went on strike following paycuts of 43% to 70 maintenance workers.[7] In 2019, it was estimated that the mine was losing A$6 million a month, with total losses since 2011 running up to A$1.3 billion.[8] In 2021, Griffin Coal invoked force majeure in response to large-scale rainfall affecting coal pit operations.[9] State politicians raised concerns that the force majeure declaration was indicative of the poor financial state of the company. Later in the year, the company was fined for a failure to pay former mine manager Carna Civil and Engineering, who ran the mine for a 9 month period between March and December 2014.[10] In November 2021, the Australian Securities and Investment Commission (ASIC) filed criminal charges against the owner, alleging that the company had failed to lodge audited financial accounts for the 2019 and 2020 financial years.[11] The case was later expanded to include charges over the company's failure to have an Australian director.[12]

Concern has been expressed over the possibility of bankruptcy, as the Griffin mine acts as the sole supplier of coal to the Bluewaters power station, responsible for generating approximately 15% of Western Australia's electricity.[13] [14] Griffin also acts as a supplier to South32's Worsley alumina refinery.[15]

Notes and References

  1. News: Indian owners of failed West Australian coal in $1 billion quest to salvage calamitous bet . Daniel . Mercer . 2022-11-26 . ABC News . Australian Broadcasting Corporation . 2022-11-29.
  2. News: Growing WA coal crisis sparks warnings of possible power crunch as summer looms . Daniel . Mercer . 2022-09-17 . ABC News . Australian Broadcasting Corporation . 2022-09-17 .
  3. News: McGowan government hands cash to struggling Griffin Coal amid looming summer energy crisis . Kate . Stephens . Anthony . Pancia . Gian . De Poloni . 2022-12-20 . ABC News . Australian Broadcasting Corporation . 2022-12-21 .
  4. News: 19 August 1932 . GRIFFIN COAL MINE. . 18 . . National Library of Australia . Perth, WA . 3 February 2016.
  5. News: Lanco acquires Griffin coal for A$730 mn . Sobia Khan . . 5 March 2011 .
  6. News: Lanco Rebuffs Griffin Liquidation Concern With Vow to Keep Unit . Rajesh Kumar Singh & David Stringer . Bloomberg News . 4 July 2013. "No winding-up order has been issued" against Griffin Coal Mining,A. Narasimhan, a spokesman for Lanco, said in an e-mail. "We are confidentthat there is no basis for winding up and that the matter with the AustralianTaxation Office will be resolved as soon as possible."
  7. News: 2016-06-24 . Griffin Coal workers strike over planned pay cut . en-AU . ABC News . 2022-05-07.
  8. News: 2019-10-29 . WA coal 'in crisis', MP says, as major mine losing $6m a month teeters on the brink . en-AU . ABC News . 2022-05-07.
  9. News: 2016-06-24 . Griffin Coal workers strike over planned pay cut . en-AU . ABC News . 2022-05-07.
  10. News: 2021-10-09 . Indian-owned Australian coal mine suffers 'another nail in the coffin' after big legal loss . en-AU . ABC News . 2022-05-07.
  11. News: 2021-11-11 . Embattled coal mine suffers blow as corporate cop presses charges . en-AU . ABC News . 2022-05-07.
  12. News: 2021-11-27 . Besieged Indian-owned coal mine hit by further charges as corporate cop widens case . en-AU . ABC News . 2022-05-07.
  13. News: Dev Sindhu: The mystery man at the centre of a deepening crisis threatening an Australian energy grid . Daniel . Mercer . 2022-12-18 . ABC News . Australian Broadcasting Corporation . 2022-12-18 .
  14. News: 2020-12-16 . Australian coal-fired power plant bought for $1.2b now 'effectively has no value' . en-AU . ABC News . 2022-05-07.
  15. Web site: 2020-07-21 . WA coal in crisis as Griffin accused of contract breaches . 2022-05-07 . Australian Financial Review . en.

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