v3.26.1
Stanwell Liabilities
 6 Months Ended
Jun. 30, 2026
Stanwell Liabilities [Abstract]  
Stanwell Liabilities
12.
Stanwell
Liabilities
(in US$ thousands)
June 30, 2026
December 31,
2025
Current
Stanwell Reserved
Area deferred
consideration
$
15,805
$
—
Stanwell Prepaid
coal
supply
liability
13,104
—
$
28,909
$
—
Non-current
Stanwell Reserved
Area deferred
consideration
$
362,318
$
346,768
Stanwell Prepaid
coal
supply
liability
164,902
155,027
Stanwell Prepayment
and deferred
payment
65,270
—
$
592,490
$
501,795
Stanwell deferred
consideration
liability
On August
14, 2018, the
Company completed
the acquisition
of
rights to
mine in the Stanwell Reserved
Area, or
the
SRA,
adjacent
to
the
current
Curragh
mining
tenements.
These
rights
were
acquired
on
a
deferred
consideration
basis,
and
on
acquisition
the
Company
recognized
a
“Mineral
rights
and
reserves”
asset
and
a
corresponding
deferred consideration
liability of $
155.2
million (A$
210.0
million),
calculated using the
contractual
pre-tax discount
rate of
13
%, which
represented
the fair value
of
the arrangement at
the date
of
acquisition.
The
deferred consideration
liability
reflects
the passage
of
time by
way of
an annual accretion at
the contractual
pre-
tax discount
rate of
13
% and
will be settled
as a
discount
to the
price of
thermal coal
supplied
to
Stanwell over
the term
of
a New
Coal
Supply
Agreement
which is
expected
to commence
in the
second
quarter of
2027. The
accretion
of
the deferred
consideration
liability
is
recognized
within
“Interest
expense,
net”
in
the
Condensed
Consolidated
Statements
of
Operations
and Comprehensive
Income. The
right-to-mine-asset
is amortized
over
the coal
reserves mined
from
the SRA.
Stanwell –
Prepaid
Coal Supply
Liability
On June 10, 2025,
the Company and Stanwell
entered into a deed
of
amendment, or the First Amendment Deed,
and amended the
New Coal Supply Agreement
dated July 12, 2019, or the NCSA,
and the Amended Coal Supply
Agreement,
or
the
ACSA,
whereby
Stanwell
provided
near-term
liquidity
to
the
Company
in exchange
for the
supply
of
additional
tonnage
of
thermal coal
under the NCSA.
The First
Amendment
Deed included
a prepayment
for thermal
coal
and a rebate
waiver and
deferral
from
April
2025 to December
2025, both
of
which will be settled
through
reduction
of
the gross proceeds
to be received on
the physical
delivery
of
thermal
coal
to Stanwell,
expected
to
commence
in the
second
quarter
of
2027, or
the
NCSA
Supply
Commencement
Date,
of
up
to
0.8
MMt
per
annum
over
five years
,
or
until
such
time
that
the
obligation
is fully
settled.
This prepaid
coal
supply
liability
bears interest
at
13
% per
annum.
As of
June
30,
2026,
the carrying
value
of
the
Stanwell
prepaid
coal
supply
liability
,
including
the
prepayment
and the rebate
waiver and
deferral
liability,
was $
178.0
million
(A$
250.7
million).
For
the three
and
six
months
ended
June 30,
2026,
the
Company
recognized
interest
expense
of
$
5.9
million
(A$
8.4
million) and $
11.1
million (A$
15.8
million), respectively,
related to the financing
component
of
the prepaid
coal
supply
liability.
Prepayment
and Deferred
Payment
Balance
On November
27, 2025,
the
Company
and Stanwell
entered into
a second
deed of
amendment,
or the
Second
Amendment
Deed,
that, among
other matters,
amended the
terms of
the ACSA and the
NCSA, by
providing
for:
●
a waiver
of
rebate
amounts
otherwise
payable
by the
Company
under the
ACSA
from
January 1,
2026
until the final delivery date, being the day before the NCSA
Supply Commencement
Date (refer to change
of
control
provisions
in relation to
the waiver discussed
below);
●
a deferral
of
the Company’s
obligations
to deliver certain values
of
coal to Stanwell
for prepaid
amounts
under the
First Amendment
Deed
and amounts
to which
Stanwell is
otherwise
entitled
in relation
to the
SRA deferred
consideration,
or the Deferred
Amounts;
●
prepayments
by
Stanwell
to
the
Company
in relation
to
its
future
annual
nominated
contract
tonnage
under the ACSA and the NCSA equal to the difference between
the current contracted prices under these
arrangements
and
an agreed,
fixed
price roughly
equivalent to
market
prices at
the time
of
the Second
Amendment
Deed,
or
the
ACSA
Prepayments
and
the
NCSA
Prepayments.
Stanwell’s
obligation
to
make
the
ACSA
Prepayments
and
NCSA
Prepayments
are
subject
to
certain
liquidity
tests.
More
specifically,
Stanwell (i)
will advance all of the relevant prepayment
when the Company’s monthly liquidity
is
below
$
200.0
million,
(ii)
will
advance
only
half
of
the
relevant
prepayment
in
months
when
the
Company’s
liquidity
is between
$
200.0
million and
$
250.0
million, and
(iii) will
not
be obligated
to make
prepayments
when the
Company’s
monthly
liquidity
is above
$
250.0
million;
and
●
an extension
of
the NCSA
term
from
2037
to
2043
and
an option
for Stanwell
to
make
broader
annual
nominations
ranging from
1.2
MMt to
2.24
MMt per
year under the NCSA.
The
value
of
the
ACSA
Prepayments,
NCSA
Prepayments
and
Deferred
Amounts,
or
the
Prepayment
and
Deferred
Payment
Balance,
will
be settled
through
delivery
of
coal
to
Stanwell during
the
term
of
the
NCSA
in
months
when
the
Company’s
liquidity
exceeds
$
300.0
million.
In
addition,
the Company
may
from
time to
time
make
additional
payments
to
reduce
the
Prepayment
and
Deferred
Payment
Balance,
including
when
the
Company makes
permitted distributions
to shareholders. Where
the Prepayment and
Deferred Payment
Balance
remains
outstanding
after
the
final
delivery
date pursuant
to
the
NCSA
(December
31,
2043),
the
outstanding
balance
will be settled
in cash in
months when
the Company’s
liquidity
exceeds $
300.0
million until
the balance
is fully
repaid.
The
Prepayment
and
Deferred
Payment
Balance
is
classified
as
a
financial
liability.
The
liability
is
initially
measured
at
the
amount
of
proceeds
received
from
Stanwell
and
bears
an
interest
at
7.5
%
per
annum.
The
contractual interest
rate of
7.5
% is deemed consistent with
a market rate at inception
after considering
the overall
terms, security
and settlement features
of
the arrangement and, accordingly,
the proceeds received
approximate
fair value at inception. Interest
accrues at
7.5
% per annum on the
outstanding balance
using the effective
interest
rate method
and is
recognized
as “interest
expense,
net” in
the
unaudited
Condensed
Consolidated
Statement
of
Operations
and Comprehensive
Income.
During the
term
of
the NCSA, the
total Prepayment
and
Deferred
Payment Balance,
including
accrued interest,
is capped
at
120
%
of
the aggregate
outstanding
principal
balance. After
the
final delivery
date
under the
terms
of
the NCSA, which is scheduled for
December 31, 2043, interest
continues
to accrue at
7.5
% per
annum without
a cap
until the balance
is fully
repaid.
The interest
cap represents
assistance
provided
by Stanwell, a Queensland
Government-owned
corporation.
As
such,
the Company
accounts
for the
interest
cap as government
assistance
under its
accounting
policy
election
based on analogy
to other
accounting
standard frameworks
and consistent
with expected future
changes to U.S.
GAAP.
No benefit
is recognized
unless and
until the interest
cap
is reached.
At
the
end
of
each
reporting
period,
management
assesses
whether
the
Company’s
liquidity
is
expected
to
exceed
$
300.0
million
within the
next 12
months and
classifies
the portion
of
the balance expected
to be
settled
within that
period
as current liability.
As of
June 30,
2026, the carrying
amount,
including accrued
interest,
of
the Prepayment
and Deferred
Payment
Balance was $
65.3
million and classified
as
non-current liability.
No government
assistance income
was recorded
during the
three and
six
months
ended June
30,
2026, as the interest
cap
mechanism was not
triggered.
The
Second
Amendment
Deed
also
includes
restrictions
on
the
Company’s
ability
to
pay
distributions
to
shareholders
(e.g.,
dividends)
.
These restrictions
require
that the
Company
maintains
a minimum
cash liquidity
of
$
300.0
million
following
payment
of
such
distribution,
the
repurchase
of
any
Notes
in
connection
with
the
distribution,
and the
payment
to Stanwell
of
an equal
or greater
amount (up
to a
maximum
of
three times)
than
the distribution
to
reduce the Prepayment
and Deferred
Payment Balance.
The
ACSA
and
the
NCSA
are
secured
by
mortgages
registered
over
the
Curragh
mine
tenements,
or
the
Tenement
Lien, at the Queensland
Government level and
a third-priority lien on substantially
all of the Company's
assets.
The Tenement
Lien operates
independently
of,
and is not subordinated
to, the Company's
other secured
debt obligations,
and no third
party
may acquire
the Curragh
mine tenements
without
simultaneously
assuming
the coal
supply
obligations
to
Stanwell.
The Prepayment
and Deferred
Payment Balance
may become
repayable
if there is an unremedied
default
under
the ACSA
or NCSA.
If a change
of
control
of
the Company
is proposed
within
two years
of
November
27, 2025,
the
Company
must
obtain
Stanwell’s
consent
and,
before
the
change
of
control
occurs,
pay
Stanwell the
waived
rebate
amounts,
together with contractual
interest from
the dates such amounts
would otherwise have
been payable.
Additionally,
if
an
entity
that
controlled
the
Company
as
at
November
27,
2025
ceases
to
control
the
Company
by
way of
disposal
of
an interest in the Company of
20
% or more without
Stanwell’s consent
within
two years
of
November
27, 2025,
then the
Company
must immediately
pay
Stanwell the
waived rebate
amounts,
together
with interest.
As of
June 30,
2026, cumulative
rebate
amounts
of
$
48.8
million
would
have been
payable
absent
the
waiver.
No liability
was recognized
as of
June 30,
2026
in respect
of
the waived
rebate amounts
because the
Company
had not been required
to seek Stanwell’s
consent in connection
with any proposed
change or cessation of
control
as of
that date.