Nathan Tinkler's Dartbrook coal play

I hope that you had a happy and peaceful Christmas.

The proposed sale of the mothballed Dartbrook coal mine Anglo American plc to the Nathan Tinkler controlled Australia Pacific Coal (Stock Exchange ticker AQC) for a price of up to $A50 million (here, here, here) has been greeted with a degree of incredulity and indeed anger in some quarters.

Under the terms of the deal, AQC will acquire:

• Anglo American's 83.33% interest in the Dartbrook JV
• a 100% interest in Anglo Coal (Dartbrook Management) Pty Ltd, manager of the Dartbrook JV 
• a 83.33% interest in Dartbrook Coal (Sales) Pty Ltd, marketing agent of the Dartbrook JV (

The consideration for the acquisition includes:

• a A$25 million cash payment
• a royalty over AQC’s share of coal from the Dartbrook joint venture at a rate of A$3.00 per tonne of coal sold or otherwise disposed of and A$0.25 per tonne of any third party coal processed through the Dartbrook infrastructure, but capped at A$25 million (subject to escalation in accordance with CPI). 
• in addition, the Company will be replacing approximately A$7.7 million in financial assurances in respect of the Dartbrook mining tenements.

You can see what Mr Tinkler is trying to achieve. Anglo American is in a degree of trouble world wide, and is seeking to slash 85,000 jobs. Dartbrook is on a care and maintenance basis, is quite surplus to requirements, while coal prices are very low. It wants out. From Mr Tinkler's perspective, the mining and transport infrastructure is there, while the coal is high quality thermal coal that can be extracted more cheaply if the present underground mine is replaced by an open cut. His aim is a low cost coal mine that will be profitable once coal prices recover somewhat, highly profitable is if coal prices increase significantly, creating either an asset for sale or a cash flow that can be used to support other projects. He is, in fact, trying to replicate the process that gave him his original fortune.

I am not privy to the numbers, but they could well stack up in commercial terms. However, the AQC statement to the Exchange seems remarkably sanguine on two points: the first the likelihood of community support, the second the expectation that environmental approvals will be relatively easy to obtain given nearby mines. Every Hunter Valley coal proposal now meets fierce environmental opposition, while too many people are owed money from Mr Tinkler's previous ventures to provide a basis of trust. Even the unions which normally support mining ventures because of the jobs provided are extremely cautious because of Mr Tinkler's involvement. .    

Season's Greetings amid memories of Christmases past

I am shutting down for the Xmas break. Publication will resume on the thirtieth

Christmas is a very special time for all of us, marked by our own family rituals.

Growing up, Christmas began with a pine branch buried in a pot. Downtown, brother David and I visited Coles and Penneys with our money clutched in our hands to buy presents.

On Christmas Eve people came round to our house for drinks. We had to go to bed, but were allowed to stay up for a while to meet people.

Christmas Day dawns. On our bed is a Santa sack full of presents. We play with these waiting for our parents to wake up. They do, and we get our presents from them. One year this was an Indian outfit for us both, made by Mum using whatever she could find from sacking to old belts to feathers collected from the chooks and died.

Mid morning and we go down to Fah and Gran’s, a block away in Mann Street. This was always open house for our grandparents’ friends and electorate workers. The Mackellars who managed Forglen, Fah’s property, were always there with eldest my age. We talk to people and go outside to play.

Once people have gone, we get another set of presents from our grandparents and aunts. Then to Christmas lunch, always a roast chook. We kids sit in a little sun room off the main dining room.

After lunch we play, rolling down the grass slopes. Sometimes there are special events. I remember one Christmas a piper played, striding up and down the lawns at the back of the house.

Later we go up to the Halpins for late afternoon Christmas drinks.

Time passes. I am living in Canberra, joining the great New England diaspora.

Neville Crew’s 1960s’ research showed that for every one person living on the Tablelands there was one Tablelands’ born person living elsewhere. This pattern is replicated across the broader New England, from the lower Hunter to the boarder. As best as I can work out, if we count those born in the broader New England plus their immediate children, we are talking about more than a million people.

By bus, car, plane and train, many of us try to come home, meeting old friends.

The last time I saw Zivan Milanovich was on the train. Zivan’s dad Branco was groundsman at TAS. I knew Branco, but only in a formal sense. By contrast, Zivan and I were in scouts together, 2^nd Armidale Troop. We were mates.

I suppose that 2^nd Armidale still has a bob a job week equivalent. That year Zivan and I decided to clean shoes in Beardy Street. We stood there, but no one came. Finally we overcame our shyness, started spruking and approaching people. The cash rolled in. I think that we both learned an important lesson, the way in which you have to stand outside yourself to be successful.

Those Christmases were very special times as those dispersed over tens of thousands of miles came together.I know that you all have your own rituals and memories.

I wish you and your a safe and happy Christmas and a successful new year.