New Hope has reached a binding commitment with Taipower with respect to the Bengalla Joint Venture (JV). Taipower will purchase a further 10% interest in the Bengalla JV by participating in the sale by Wesfarmers Ltd. of its 40% interest to New Hope. Mitsui has waived its pre-emptive right with respect to the Wesfarmers transaction. Once the Wesfarmers acquisition is complete, New Hope will hold a 70% interest in the joint venture with Taipower and Mitsui holding interests of 20% and 10%, respectively. The Wesfarmers transaction is expected to complete in early December.

Located 4 kilometers (km) southwest of Muswellbrook in the Hunter Valley region of New South Wales, the Bengalla mine is an open-cut mine that uses a dragline, trucks and shovels to supply 8 million metric tons (mt) of thermal coal annually.

New Hope has also reached a binding commitment with Mitsui to purchase its 10% interest in Bengalla for A$215 million. The transaction will be financed by a combination of cash and debt. The economic effective date for this transaction will be consistent with the Wesfarmers sale.

New Hope’s final interest in the Bengalla JV will be dependent on the actions of Taipower during the pre-emptive rights process for the Mitsui transaction. Following completion of the Mitsui transaction — anticipated to occur in the first quarter of 2019 — New Hope will own up to an 80% interest in the Bengalla JV.

“Acquiring a controlling interest in Bengalla demonstrates New Hope’s long-term positive outlook for the global export thermal coal market and our commitment to the Bengalla mine and its employees,” said Shane Stephan, New Hope managing director. “We are very excited about the company’s immediate prospects and remain committed to delivering our medium-term growth objectives.”

To fund the acquisitions of both Wesfarmers’ and Mitsui’s interests in Bengalla, New Hope has entered into a A$600 million syndicated corporate debt facility and a A$300 million facility for performance bonds, letters of credit and other like contingent instruments. These facilities will be sufficient for the company to also fund its medium-term growth projects, including New Acland Stage 3 and the potential development of the Burton Lenton project.