PIKE River Coal will delay its production ramp-up to the last three months of this year after a rock fall this month blocked 30m of a ventilation shaft at its namesake underground coal mine on New Zealand’s South Island.
“The timing was unfortunate, coming just as Pike River was about to commence its ramp-up of coal production,” the Kiwi company said as it released results for the half-year ended December 31, 2008.
The rock fall halted operations and the shaft is still being repaired.
Two weeks before the incident, Pike was expecting hydro-mining would have the company on track to produce 160,000 tonnes by the end of June.
It has now delayed increasing production until the last quarter of the calendar year.
Meanwhile, the new coal producer reported a net deficit of $NZ9.55 million for the last six months of 2008.
Pike was also hit by the declining New Zealand dollar which led to unrealised exchange losses of $NZ10.8 million on the company’s convertible bonds.
The coal play is expecting a strong revenue stream from its hard coking coal once the shaft is fixed.
Shares in the dual-listed company remained unchanged at 62.5c on the Australian Securities Exchange today.
PRC Price at posting:
64.2¢ Sentiment: LT Buy Disclosure: Not Held
