The mining union is appealing to British billionaire Sanjeev Gupta to consider accepting a substantial offer for the purchase of the Tahmoor coal mine, which has been inactive for a year due to ongoing financial difficulties faced by its current owner.
The Mining and Energy Union (MEU) has expressed concerns that the continued delays in selling the Tahmoor coal mine, located to the south-west of Sydney, could lead to irreversible damage to the operation and threaten the jobs of hundreds of workers.
According to the union, Mr. Gupta turned down a recent offer of $350 million made last week by a consortium that includes RStar, the mine's primary contractor.
Bob Timbs, the president of MEU South West District, emphasized that accepting this sale would settle all outstanding debts and facilitate the reopening of the mine. "We can confirm that a solid proposal has been made to Sanjeev Gupta for the acquisition of the Tahmoor mine by the local contractor RStar," he stated. "We are in favor of this transaction and would support any sale to reputable companies or mine operators willing to take over."
Timbs further noted that the proposed deal would ensure full repayment to all creditors, including the royalties owed to the state government, while also providing sufficient funds to restart operations at the mine.
The Tahmoor Colliery, situated south-west of Sydney, has not been operational since February of the previous year, having depleted its cash reserves amid the financial struggles of Mr. Gupta's GFG Alliance. Approximately 500 workers, including contractors, were placed on minimal pay, and by November, many were notified that their wages would cease entirely.
The mine's holding company, Liberty Primary Metals Australia (LPMA), was placed into administration late last year, and a process seeking expressions of interest for the mine was initiated in January.
Timbs criticized Gupta’s refusal to sell, calling it "bizarre." He explained that the offer was presented outside of the administrators' structured process in an effort to expedite the mine's return to operation. "Prolonging the mine's closure could jeopardize its future viability. It isn’t like a factory where you can simply shut the doors and reopen whenever. This is a deep underground coal mine, and it shouldn’t have remained closed for so long. It's unacceptable that he has the chance to clear debts, repay the community, and restart operations yet chooses to decline the offer."
Administrators William Buck announced that the expression of interest process regarding LPMA's shares in Tahmoor Coal is set to conclude on February 11. In a statement, they indicated that the initial phase of market testing for the sale is currently underway and have opened a paid-access data room for potential buyers containing detailed information about the mine. "We are encouraged by the level of engagement and interest shown in this process," the administrators remarked.
Meanwhile, GFG Alliance has reiterated that the administrators’ process represents the only viable pathway moving forward. A spokesperson for the company noted, "The formal sale process for Tahmoor Colliery is being managed by the deed administrators, William Buck, with support from GFG Alliance." They warned that engaging in an "unfunded liquidation would be catastrophic." Offers that lacked firm funding or were merely speculative would not be considered.
In light of the situation, the union announced plans to lobby creditors and government officials should the mine not be sold. "After enduring 14 long months in support of GFG and pursuing a sale, we have reached a point where we must assertively advocate for a sale. If necessary, we will approach creditors, the government, and anyone else required to facilitate a transfer of ownership away from him," Timbs expressed.
State Resources Minister Courtney Houssos has been reached for comments. Last November, she declined to lift a fixed charge on Tahmoor Coal's leases, insisting that GFG Alliance remit $29.4 million in overdue royalties. Shadow Minister for Resources, Dave Layzell, called the situation "extremely serious," urging the NSW government to consider whether the operator is a "fit and proper person" to maintain the lease. "The minister can cancel the lease at any time if they believe that the leaseholder has failed to use the land in good faith," he pointed out.
Additionally, on Monday, the Supreme Court is scheduled to hear a case brought by Coal Mines Insurance Pty Ltd, which administers the workers' compensation fund for the coal industry. Co-owned by the MEU and the NSW Minerals Council, the fund is owed $4.7 million. The insurer is seeking legal action to wind up the Tahmoor company.
