Ground Breakers: This junior coal stock was a voyeur's dream last year; could they become a producer in 2023?

Australian Pacific Coal says it has multiple offers lined up for debt funding for its Dartbrook mine
Restart planned in the second half
Materials lifts on strong economic news as bank fears fade into background

Much of the intrigue surrounding off-the-radar coal stock Australian Pacific Coal (ASX:AQC) centred around the re-emergence of Nathan Tinkler, the former bogan baron of Aussie coal, into the Hunter Valley coal scene.

Tinkler was squeezed out in his attempts to re-ensconce himself in the Dartbrook project.

But the ownership team that later emerged for the mine — consisting of Australian Pacific Coal along with JV partners in traders M Resources, Tetra Resources and major shareholder the Nick Paspaley backed Trepang Services — has since been set on the task of reviving the former Anglo American coal mine.

Shuttered since 2006, Dartbrook has approval to operate underground, around 4km west of Aberdeen, until 2027.

AQC today said it had made progress on “major critical path acivities” for the restart of the mine.

“AQC and our Joint Venture partners have made good progress on all major critical path activities since the end of December, particularly the remediation operations at the mine site and efforts to secure funding to enable production restart in H2 2023,” interim CEO Ayten Saridas said.

“The strong interest in the data room confirms the attractive investment proposition of the Dartbrook Project.”

That comment is a reference to debt funding, which AQC says is being progressed.

Garnering debt for a coal mine these days is not the easiest task. But AQC says it has multiple offers that are currently being assessed following the completion of “substantial due diligence”.

Including work done to date the company estimates capex for the mine will come in at $100-120m.

Since the corporate kerfuffle over Dartbrook last year coal prices have fallen considerably from around US$400/t by more than 50%, with front month Newcastle 6000kcal futures at US$179.65/t yesterday.

Australian Pacific Coal (ASX:AQC) share price today:

And on the markets?

A rebound for the materials sector today, up 0.55% after some positive economic data in the US and China, where the property sectors are looking healthier.

Gold was up as well, but investors couldn’t be bothered giving it another bump after a couple of strong days and with a US rates decision coming over the horizon next week.

Pilbara Minerals (ASX:PLS), Mineral Resources (ASX:MIN), South32 (ASX:S32) and Fortescue (ASX:FMG) were among the large cap miners finding favour today.

Meanwhile higher gas and oil prices sent some coal and energy companies up with the energy index rising 1.35%. Yancoal (ASX:YAL) lifted 3.28% while Woodside (ASX:WDS) was up 1.87%.