New Zealand’s only listed local coal mining company, Pike River Coal (NZX: PRC, ASX: PRC), is seeking short term working capital to help pay for its West Coast coal mine in New Zealand.
The company chairman John Dow said that potential funders were in talks with the company. Pike River Coal hopes to have a positive outcome from the present round of discussions by the end of the month.
The mine location includes a part of the Paparoa National Park most famous for the Pancake Rocks and blowholes of Dolomite Point.
Shares in the company dropped over 4% after it said that it needed more funding to sustain its rate of underground mine development. The company reported a loss of $39 million for the year ending June 2010. In 2009 it had reported a $13 million loss.
Mr Dow attributed the short term cash flow problem to increases in cost and delay in the receipt of revenues from the second coal shipment last week. The company exported 20,000 tonnes of the coal, which obtains a premium for its specialist steel-making attributes, out of an earthquake-damaged Port Lyttelton last week.
With the hydro mining equipment fully installed and the first extraction planned to start this week Mr Dow said that the company was into a phase where it could forecast future production rates with more accuracy and confidence.