Bowen Coking Coal has raised $41.5 million in an institutional share placement that will set it up to bring the mothballed Burton mine into operation.

The company said the funds would go towards the acquisition of a majority interest in the Burton mine
and Lenton project, to partly fund restart costs at Burton and for working capital and offer costs.

It aims to source the remainder of the funds required to recommission Burton under a debt process being facilitated by Grant Samuel.

The company has signed a binding term sheet with New Hope Corporation to gain a 90 per cent stake in asset owner the Lenton joint venture for $20 million upfront and up to $77.5 million in royalties and milestone payments.

“The hard work of the Bowen team has paid off with the acquisition of Burton cementing our premium portfolio of near-term production assets,” Bowen managing director Gerhard Redelinghuys said.

“We have secured a number of highly synergistic assets, rapidly bringing our projects into production to
leverage favourable coal prices.

“We are excited to take the next step in our growth story, with first production from the Bluff mine acquisition, completed in December 2021, expected by the end of Q1 2022.”

The company recently announced it had secured coal sale contracts with steel producers Posco and Formosa for a fixed volume of 250,000 metric tonnes of coal from the restarted Bluff operation.

It said 40,000 metric tonnes were scheduled for delivery within Q2 2022 with the remainder evenly spread over the second half of this year.

Bowen Coking Coal bought the mine, near Blackwater, last year from mining contractor MACA for $5 million plus royalties.

It has also paid $9.9 million to Queensland Treasury to replace the existing $4.6 million environmental
bond and a further $5.3 million to secure the additional rehabilitation obligations over the remaining life of mine.

Restarting the Bluff mine – which was placed on care and maintenance in December 2020 – is expected to create at least 175 jobs.

Bowen Coking Coal also owns the Broadmeadow East, Isaac River, Cooroorah, Hillalong and Comet Ridge coking coal projects in the Bowen Basin. It is also a joint venture partner with Stanmore Resources in the Lilyvale and Mackenzie coking coal projects.