Unsecured Pike River creditors miss out after mine sells

Smoke pours from the underground Pike River mine after the 2010 explosions. Photo / File
Smoke pours from the underground Pike River mine after the 2010 explosions. Photo / File

Unsecured Pike River mine creditors will get nothing from the sale of the mine, which was finalised yesterday.

State-owned mining company Solid Energy has bought Pike River Coal Ltd, which was put in receivership following the November 2010 explosions that killed 29 men.

Receiver PWC has confirmed the $5 million balance of the $7.5m purchase price had been received.

The sale comes after Solid Energy completed due diligence on the assets in May and agreed to a full but conditional sale.

Grey District Mayor Tony Kokshoorn told Radio New Zealand this morning it was disappointing the receivers had not been able to get a better price for the mine so money could be paid back to everyone.

"It was a case of the receivers running out of buyers - the Chinese and the Australians that were in there all left - so they really had to go back to Solid Energy who had pulled out of the deal pre-Christmas."

Receiver John Fisk told Radio New Zealand this receivership was the most challenging he had seen because they were dealing with the loss of 29 men and the tragedy that went along with that.

"So that led to a lot of national interest - we were under the spotlight, at times we were criticised for what we'd done - so that added to the complexity of the job."

He said there was no way unsecured creditors would be seeing any money from the sale.

"There's still something like $26 million owing to New Zealand oil and gas and so any recovery up to the $26 million would go to them."

The sale conditions included the successful transfer of mining permits and land access agreements; a contribution to police costs in dealing with the explosion; and an agreement with the Government over who was responsible for recovering the dead miners' remains.

In a statement, the company said it had told families that it could see no way they could recover the bodies of the men who died in the mine as a stand-alone operation.

It said the only way it could be attempted was as part of a wider commercial mining operation.

The company said it would likely be several years at least before it would be in a position to say if it had a safe, technically feasible and commercially viable mining plan.

But the spokesman for the families said it was positive that they were dealing with a company one-on-one, which they had not been able to do since the explosions.

"The Government left us, the police left us, we had a receiver that was basically only there for a commercial venture to clip the ticket and leave," he said.

"That's what we've had to put up with up until now."

Monk said risk assessments had been completed and he was confident a recovery operation could happen under Solid Energy's ownership.

- NZ Herald

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