Bowen Coking Coal has appointed Mark Holland and Shaun Fraser of McGrathNicol Restructuring as voluntary administrators. The decision follows the company’s inability to secure fresh capital or reach an agreement with BUMA and the Queensland government. Bowen Coking Coal is a Queensland-based company focused on developing metallurgical coal projects. Metallurgical coal is an essential component in steel production.
The embattled coal miner, whose shares were recently suspended from trading on the ASX, stated it was unable to negotiate alternative commercial arrangements with its two largest creditors, BUMA and the Queensland Revenue Office, and its senior secured lender. A contract dispute led Indonesian contracting giant BUMA to demand a payment exceeding $15 million.
The company described the decision to appoint administrators as disappointing. It follows the rejection on July 29 of the company’s most recent submission to the QRO for a short-term deferral of royalties. The board’s decision also reflected the current challenging environment for the coal industry in Queensland.
The challenges include higher costs, lower global coal prices, and increased royalty rates introduced by the Queensland government in 2022. These factors have collectively contributed to the company’s financial difficulties and the ultimate decision to enter voluntary administration.
