Aurizon in talks to buy Wiggins terminal
Aurizon Holdings (Aurizon) has confirmed that it is in discussions to purchase the Wiggins Island Coal Export Terminal (WICET) in Australia.
According to Reuters, the rail company said it was in initial talks with undisclosed parties for a deal whereby it would acquire the port while “other consortium members” would obtain one or more of the coal mines using the facility.
The terminal is currently owned by a group of coal producers including Glencore, with the group currently facing a September 2018 deadline to begin paying down a debt of $3bn on the most expensive coal port in the world.
The Australian Financial Review reported that Macquarie Group is one of the deal consortium’s members.
A person familiar with the situation told Reuters that the agreement could include Macquarie purchasing Glencore’s Rolleston mine and Wesfarmers’ Curragh mine, with both facilities using the port and currently for sale.
In a statement emailed to Reuters, Glencore said it was witnessing “strong interest” from a number of parties for the Rolleston mine.
WICET, which was constructed to service a consortium of eight coal companies, was completely funded by debt backed by port fees on 27m tonnes of coal annually, whether that amount was shipped or not.
With three of the facility’s eight original users having been shut down, the remaining ones must take on all of the port’s debt and fees.
The terminal is exporting a lot less than the 27m tonnes figure and the remaining users pay about $25 a tonne there, a price which is around five times the port fee at the adjacent RG Tanna terminal.
Failure of the port to be refinanced will mean, according to loan terms, that Glencore and its partners must pay off the full $3bn over the following decade.
One of the aims of the deal by Aurizon, which is the biggest rail freight operator in Australia, is to reduce port charges.
“Through restructuring and the proposed introduction of lower, market-competitive port charges, there would be incentive for miners to increase throughput at the port,” the company said.
Since Aurizon chief executive Andrew Harding took over in December after 24 years with Rio Tinto, Aurizon has quit its loss-inducing freight business, enabling it to focus on coal haulage.
LATEST PRESS RELEASES
Christchurch, 06 July 2018 – PT Pelabuhan Indonesia I (Pelindo I) has chosen the terminal operating ... Read more
Gantrex has recently announced the launch of a whole new product category to its portfolio, the TrenchLok™ Cable Trench Cover.
Gantrex’ TrenchLok™ cable trench cover, efficiently and economically protects cranes’ power cables f... Read more
TGI Maritime Software launches two complementary modules allowing yard optimization and hazardous co... Read more
Asia’s future energy needs on the agenda at Tank Storage Asia 2018: Read more
Portunus Naem, the Egyptian branch of Portunus Port Spares & services is appointed as official Dana ... Read more
Our new office in Spain is not even a year old and we already celebrate two successfully completed i... Read more