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Flannery keeps the faith with coal as Bowen stake surges

Business

Rich lister Brian Flannery has landed an 8.6 per cent stake in Bowen Coking Coal just as the company’s shares climb 50 per cent.

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Flannery, who made his fortune on coal and his association with Trevor St Baker, holds the stake through his privately owned Ilwella in which his son, Quentin, is also a director.

Quentin took to social media to claim that “ideological sell downs” of coal projects was creating big opportunities.

It came as Bowen struck a major deal with Fitzroy Resources which will allow Bowen to start coal exports while still waiting for mining approvals and early works at its Burton mine in central Queensland.

The deal is structured so that Bowen will get 1 million tonnes a year port access at Dalrymple Bay as well as access to the Carborough Downs coal handling and preparation plant.

There has also been an in-principle agreement to extend Bowen’s Broadmeadow East open cut area to the south into an area which is controlled by Fitzroy. In return, Fitzroy will get a royalty payment and permission to mine beneath Bowen’s Mallawa haul road as well as the use of Bowen’s camp and water supply.

Bowen chairman Nick Jorss the upside for the company was that it could get the benefit of the high coal prices on offer while waiting for its own infrastructure to come on line.

He said it would accelerate the strategy to create the next independent coking coal producer in the Bowen Basin.

Following the deal, Quentin Flannery posted his congratulations to Bowen.

“This is a pivotal piece of the puzzle, enabling them to start coking coal sales in early calendar year 2022 and transforming the company from an early-stage coal company into a producer. “With the price of tier one hard coking coal at $US250 a tonne, the BCB team have positioned themselves tremendously to capture value in this market,” he said.

“The reality is, a commercial and scalable way to replace coking coal in a blast furnace doesn’t currently exist. Ideological sell downs of assets give way to a huge opportunity for hungry, nimble operators like BCB in cyclical commodity markets.”

The Ilwella stake in Bowen is worth about $18 million.

Jorss’s other mining vehicle, Ballymore Resouorces,  hit the ASX today with a pre-list price of 20 cents a share and jumped 45 per cent. Jorss has a 9.6 per cent stake.

 

 

 

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