Business

GVK boss determined to push on despite funding hurdles

DEVELOPERS of a $10 billion Alpha coal project in Western Queensland could face a 12-month delay as it struggles to secure the funding to start work.

GVK boss GV Sanjay Reddy said even in the face of funding hurdles and grim coal prices, he was determined to push on with the plan.

First coal was to be exported in 2015; that has now been pushed back to early 2016.

Mr Reddy told Reuters in New Delhi the first target was "too ambitious" considering the size and scale of the project, which aimed to export up to 30 million tonnes of coal in its first year via a purpose-built 500km rail line and massive port expansion.

His comments follow Prime Minister Julia Gillard personally delivering a final environment approval while travelling in India earlier this month.

At the same time, GVK signed a $2 billion construction contract to build the new terminal at Abbot Point.

Mr Reddy told Reuters that it would eventually be able to export coal for a cost of about $55 per tonne, ensuring a profit even with international thermal coal spot prices falling to historic lows of about $83.

"We are not a large mining company and their cost practices are exactly what we don't want to do," Mr Reddy said.

"I have always told our team, even at A$75 a tonne coal price, we still have to be a viable company.

"Today's prices are around the A$80 to A$90 range."

GVK is understood to be planning long-term supply contracts with Japan, China and South Korea, aiming to sign on to deliver deals for 15 million to 20 million tonnes.

Topics:  gvk, western australia



Join the Community.

Get your local news, your way.

Stay Connected

Update your news preferences and get the latest news delivered to your inbox.

Calm weather with up to two-metre swells at Tweed

Waves might look like this.

Surf conditions for the beach this weekend.

Feast of street food trucks into Harbour

FEAST FOR FOODIES: Mat Whalley, Kat Creasey, Chico Green and Trevor Braga from Food Kartel and Destination Tweed CEO Bill Tatchell are looking forward to the Tweed Food Truck Extravaganza.

Food Trucks will descend on Tweed Heads for a street food fiesta

Upmarket beach townhouse

Real Estate: 4/45 Kingscliff Street, Kingscliff NSW.

Take a look inside this stylish Kingscliff townhouse conversion

Latest deals and offers


British family bashed in Thailand

Family beaten and kicked unconscious by gang in Thailand.

Family beaten and kicked unconscious by gang in Thailand.

Ben Hunt wary of Sharks Halfback

Ben Hunt of the Broncos looks to pass during the round 23 NRL match between the Brisbane Broncos and the St George Illawarra Dragons at Suncorp Stadium.

Ben Hunt talks about Cronulla's Chad Townsend.

Broncos prepare for Sharks

Defensive training session at the Broncos

Tough defensive session in preparation for Sharks game.

How a sacked real estate agent made $725k in four months

Agent is now under investigation by the industry watchdog

VIDEO: Art Deco fan pays $835,000 for Imperial Hotel

No Caption

Iconic "Impy" sold at a bargan price to bidder who loves Art Deco.

RBA warns of future apartment oversupply

Toowoomba: Crest Apartments and Burke & Wills, Ruthven Street ( view from Neil Street) Photo Bev Lacey / The Chronicle

RBA says oversupply of apartments poses risk to household finances