Expressions of interest for the Cobbora Holding Company will close on September 9, with the NSW government hopeful a buyer will be found for the stranded coal project.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
Goldman Sachs is the company that will be trying to drum up interest over the next month.
The Cobbora project is in need of development worth in excess of $1.5 billion before it will be ready for mining.
It was originally intended to supply coal to the then-state owned generation companies, Eraring, Macquarie Generation and Delta Electricity, before the decision was made to sell off the generation companies.
The government changed its strategy last year when it decided to cancel the onerous coal supply contracts and save some $1.75 billion in future liabilities in a deal struck with Origin Energy and also overseen by Goldman Sachs. Now Cobbora is being offered as a proposed open-cut coal mine, designed to produce 9.5 million tonnes of thermal coal a year.
The sale was announced by then-Treasurer Mike Baird last July, but it has taken more than 12 months to come to market.
There is still an expectation from some that the government will be left holding the asset, given current coal market conditions, the project's coal quality and hefty capital expenditure requirements.
Any buyer would need a strong long-term view of the coal market and this round of expressions looks like a procedural step to seal the project's place on the government's books. Sources have previously said it could be used by other miners to mix lower grade coal with their own supplies to reduce overall costs of supply.
