Doubts are mounting over whether a deal to save Gujarat NRE Coking Coal’s two Illawarra mines will go ahead next week.
Chairman Arun Jagatramka on Tuesday told more than 300 miners he was ‘‘baffled’’ by the recent behaviour of his company’s potential new owners, Jindal Steel and Power.
Mr Jagatramka is overseas and his statement was read out by NRE mines general manager Rhys Brett at a union meeting held at the Fraternity Club.
Staff at the mines haven’t been paid for three weeks, and were told last week the company had no money to pay them until at least October 16, when shareholders will vote whether to allow Jindal to become Gujarat NRE’s majority shareholder.
Mr Jagatramka’s words caused a stir among the miners, some of whom broke out in laughter as the statement began: ‘‘Dear friends we have before us some very challenging times.’’
He went on to blame falling coal prices, the external global financial environment, the strong Australian dollar, along with ‘‘liquidity restraints’’ for Gujarat NRE’s ability to pay its workers.
He said his parent company in India – Gujarat NRE Coke – had provided as much support as possible to keep the mines running in recent months, but said those funding arrangements were no longer available with Jindal projected to take over the company.
‘‘We did try and raise whatever cash we could from all potential sources by selling our non-core assets... which were our properties in Bank Street, Cliff Road and shares in REY Resources to sustain our mining operations in this period,’’ Mr Jagatramka’s statement said.
‘‘I’m thankful to Jindal for providing partial funding over the last three months to sustain operations, but I am baffled by their sudden withdrawal and absolute refusal, suddenly to remit even the critical amount needed for timely payment of weekly wages.
‘‘This was never expected by me and I am at a loss for words in this regard. My hands are tied.’’
Mr Brett was met with stony silence as he finished reading out the letter, before several workers put up their hands to ask questions of the company.
They wanted to know about rumours the power in the mines would soon be switched off, whether they could access sick leave payments while wages were on hold and demanded to know when they would hear from a Jindal representative about the company’s future.
‘‘Can anybody in this room tell us whether, on [October 16] next week, we’re going to be told ‘it’s all over and there’s no funds coming to you’, or [if] we’re going to be told ‘yes Jindal is going to take over and they’re going to back-pay you and sort everything out and financially you’re going to be all right’,’’ one man said.
‘‘Is that going to happen, or are we going to be told ‘you’ll just have to wait for another couple of weeks’?’’
However, Mr Brett was only able to ask for patience, repeatedly saying his company was in ‘‘uncharted waters’’ and would remain flexible until there was ‘‘further clarity’’.
‘‘No-one here can answer that question about what will happen on the 16th,’’ Mr Brett said.
This uncertainty alarmed the CFMEU’s general vice-president Wayne McAndrew, who said he and the union’s national officials had never experienced anything like the Gujarat NRE situation.
‘‘[Hearing what Mr Jagatramka said] makes me worried about the deal on the 16th, but until that letter was read out today the company was of the opinion it would turn around,’’ he said,
‘‘At the end of the day, we’re hopeful the company can trade their way out of it because that’s the aim of all this. The last possible outcome we want is the closure of the two mines.’’
The union meeting was also attended by several Illawarra Labor politicians – Sharon Bird, Stephen Jones and Ryan Park, as well as Gino Mandarino on behalf of Anna Watson – who expressed concerns and offered their support to workers.
Representatives from AusHelp – a Canberra-based organisation which deals with mental health issues for miners and other blue-collar workers – and financial institutions also attended.