Pike River miners could find jobs at Reefton

The entrance to the Pike River mine. Photo / Simon Baker

Underground coal mining jobs may be available at Reefton next year to replace a small number of those lost at Pike River Coal mine.

Small private company Crusader Coal Ltd has a conditional agreement to buy Solid Energy's Terrace mine. Crusader is owned by underground coal mining professionals with mining experience in New Zealand and Australia.

Solid Energy put Terrace into care and maintenance in June last year because production costs had made mining it uneconomic.

Most of its 16 permanent and two fixed-term contract staff transferred to the company's Spring Creek operation near Greymouth.

The two companies said the final sale depended on receiving approvals to transfer mining licences, permits and resource consents. Settlement was expected in the next few months.

Crusader coal director Bernie Lambley said he and his fellow directors were excited by the prospect of reopening Terrace.

"We are announcing the conditional sale now because there has been some discussion locally about the possibility of Terrace reopening," he said.

"Although we are reasonably confident all the approvals needed will come through, these could still take several months and we did not want to unduly raise expectations about employment.

"Once everything is finalised and settlement takes place, we will be in a better position to know how many mineworkers and support staff the operation will require."

He said that given the support of the local community, Crusader was confident it could successfully reopen and safely operate Terrace, he said.

Solid Energy's chief operating officer Barry Bragg said seeking potential buyers had taken longer than expected because the company had decided about six months ago to have a last look at options for retaining Terrace. The current sale process had been conducted since then and formal agreement with Crusader was reached early last month.

"We're pleased with the outcome," Mr Bragg said. "Terrace was by far our smallest coal mining operation and for a number of years leading up to operations ending there in June 2009 we struggled to find a way to make it viable, so we are happy to see Crusader take it on."

Solid Energy continues to employ 12 staff in Reefton at its Burkes Creek coal processing plant. The plant processes, blends and distributes coal from Spring Creek and local private mines.

Communications manager Bryn Somerville said none of those jobs would be affected by the Terrace sale.

When Solid Energy closed the mine it said it planned to redistribute the equipment to its other mines and allow the pits to fill naturally with ground water. Mr Somerville said neither had happened.

The sale to Crusader would include the mine, most plant and buildings. The mine had been kept pumped out and dry to below the work faces.

Solid Energy's predecessor, State Coal, began operations in Reefton in 1946 when it bought Reefton Coal Company. Terrace Mine was established in the early 1900s and remained in private ownership until 1988 when Solid Energy (then Coalcorp) bought a controlling stake.

Terrace's production peaked in 2002/03 at a little over 73,000 tonnes. From 1999 until operations ceased its average production was 45,000 tonnes a year. Its sub-bituminous coal supplied industrial and household markets in the upper South Island.

In recent years, mining reached depths of 230m, creating considerable engineering challenges.

- NZPA