Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


GTL Energy’s NZ unit posts wider loss

GTL Energy’s NZ unit, with option on Solid Energy’s idled briquette plant, posts wider loss

By Jonathan Underhill

March 12 (BusinessDesk) - The New Zealand unit of Australia’s GTL Energy posted a wider loss last year, reflecting its share of costs to develop Solid Energy’s now-idled Mataura briquette plant.

GTL Energy (New Zealand) had a loss of $761,289 in the year ended June 30, from a loss of $205,431 a year earlier, according to its annual report. It garnered no revenue while completing the plant, which used GTL’s technology to increase the thermal energy of lignite, converting it into a coal product that could be used by industry.

The briquette plant was one of the projects driven by former Solid Energy chief Don Elder, who had a vision to expand the state-owned miner into a broad-based energy company based on bullish expectations for coal and oil prices. He resigned in February last year, followed by most of the company’s board, as a slump in the price of coal left it stranded with high debt and uneconomic assets, forcing the government to provide a bailout while dropping it from a list of SOEs earmarked for sale.

“The macro challenges are the deteriorating sea-borne thermal coal price, which has impacted on our target customers’ willingness to allocate capital to new project opportunities, and access to capital for small-cap pre revenue development companies such as GTL Energy,” directors of the New Zealand unit wrote in the report.

“Solid Energy New Zealand’s change in circumstances, widely reported, has completely changed the landscape for the use of the NZ plant to support GTL Energy’s expansion and deployment plans,” they said.

Solid Energy took a $26.2 million charge against the plant in its 2013 accounts, a year when total impairments to write down the value of assets was $215.3 million. It has begun to sell non-core assets although the Mataura plant has been leased to GTL Energy.

The Australian company put the plant into care and maintenance in November “to limit the associated costs, whilst it reviews its strategy and funding options,” according to the annual report. It has an option to buy the plant, according to a Solid Energy spokesman.

Solid Energy made a payment of $500,000 to GTL Energy last June under their agreement, which the state-owned coal miner had terminated in April 2013.

Grant Thornton, the auditor for GTL Energy (New Zealand)’s 2013 accounts, added an emphasis of matter to its report, noting that the company’s current liabilities exceeded current assets by $1.49 million and drawing attention to a note that the New Zealand business was reliant on its Australian parent for capital.

Adelaide-based GTL Energy was set up in 2000 to investigate coal-to-gas and gas-to-liquids technology for a specific project in Australia using low grade coal, according to its website. This resulted in the company researching and developing technology to convert low grade coal into “higher rank fuel.”

The company operates a commercial scale plant in North Dakota and is in talks with Indonesian coal producers, Indian companies and other potential customers about opportunities in the US, India and Australia, it said.

(BusinessDesk)


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Scoop Business: Productivity Commission To Look At Housing Land Supply

The Productivity Commission is to expand on its housing affordability report with an investigation into improving land supply and development capacity, particularly in areas with strong population growth. More>>

ALSO:

Forestry: Man Charged After 2013 Death

Levin Police have arrested and charged a man with manslaughter in relation to the death of Lincoln Kidd who was killed during a tree felling operation on 19 December 2013. More>>

ALSO:

Smells Like Justice: Dairy Company Fined Over Odour

Dairy company fined over odour Dairy supply company Open Country Dairy Limited has been convicted and fined more than $35,000 for discharging objectionable odour from its Waharoa factory at the time of last year’s ”spring flush” when milk supply was high. More>>

Scoop Business: Dairy Product Prices Decline To Lowest Since July 2012

Dairy product prices dropped to the lowest level since July 2012 in the latest GlobalDairyTrade auction, led by a slump in rennet casein and butter milk powder. More>>

ALSO:

SOE Results: TVNZ Lifts Annual Profit 25% On Flat Ad Revenue, Quits Igloo

Television New Zealand, the state-owned broadcaster, lifted annual profit 25 percent, ahead of forecast and despite a dip in advertising revenue, while quitting its stake in the pay-TV Igloo joint venture with Sky Network Television. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news