Sightline Exposes Shaky Finances of a Would-be Coal Exporter

The Seattle based, Sightline Institute issued their researched report into the financial status of the Australian mining start-up, Ambre Energy on Wednesday, Feb. 13, 2013 and it immediately was picked up by news services around the world.  See the description provided by Sightline and others, below, and click on the links to read the details of the report and the news coverage.  [Thanks go to Bill R for a heads up on this development!]

Sightline released an exposé on Ambre Energy, Ltd., one of the companies behind coal-export proposals in the Northwest. Clark Williams-Derry dug deeply into the company’s finances and business history. What he found was alarming. The company is a house of cards.

We wrote a detailed and thoroughly documented report on the company (summarized here). We wanted to inform potential investors of the company’s poor prospects and enormous liabilities. We also wanted to alert communities along the proposed route of Ambre’s export plan that the corporation is not the well-established, reliable partner it purports to be.

We’ve been delighted by the coverage we’ve received so far: 72 media hits and counting.  Among the national business press, coverage of the report ran in Bloomberg Businessweek, Yahoo! Finance, MSN Money, and Wall Street Journal online “Market Watch.” We also won widespread attention across the Northwest, coverage in the coal and environmental trade press, and, in a welcome surprise, excellent coverage in Australia, where Ambre is headquartered. In addition, reporters at many other outlets are well aware of our report, and may use our findings in upcoming coverage of the coal export controversy.

Ambre is a startup. It lives by convincing investors to pony up periodic infusions of fresh capital. It intends to conduct an IPO in Australia. Indeed, it already postponed its IPO once. Media scrutiny of its massive liabilities and weak track record cannot help it raise capital.

There are five major coal-export proposals in the Northwest states. Ambre controls two of them, including the fastest-moving of the set. If bringing this information to light hurts Ambre’s ability to raise new funds or to win community approval for its plans, we’ve made a real contribution to moving the Northwest beyond dirty fuels.

– Sightline Institute

 Ambre Energy: Caveat Investor 

News Media Coverage

As of 3:00 p.m. on February 14, the report had gained 70 media hits:

  • An Associated Press piece on the report reached 42 outlets, including 6 national outlets (such as Bloomberg BusinessweekMSN Money, and Yahoo! Finance), 12 Washington and Oregon outlets, and 6 Montana outlets. A PR Newswire post of our press release reached three additional outlets, including Wall Street Journal MarketWatch.
  • The report sparked 11 original stories in two national, four Washington, three Oregon, and one Australian outlet. Nine additional outlets republished these stories. Select headlines:

o   “US Greens Group Declares War on Ambre Energy,” The Australian’s Anthony Klan (link)

o   “Foes of Northwest Export Plan Question Company’s Financial Health,” E&E News’ Manuel Quinones (link)

o   “Ambre Energy’s Plans for Northwest Coal Export Terminals Rest on Shaky Finances, Environmental Think Tank Charges,” The Oregonian’s Scott Learn (link)

o   “Coal Terminal Foe Casts Doubt on Builder’s Finances,” Seattle Times’ Hal Bernton (link)

Additional stories appeared in Sustainable Business OregonOregon Public BroadcastingCrosscutThe Daily News(Longview, WA), Greenpeace: The WitnessThe Bellingham Herald, and The Australian (a second story). This final story was especially favorable, and it’s reproduced below, because the original is kept behind a pay wall.

Ambre takes issue with US slating

A US green consultancy group has released a damning paper highlighting problems facing mining start-up Ambre Energy, including a claim that it will need almost $1 billion to get its projects off the ground.

Brisbane-based Ambre has ambitious plans to mine coal in the US northwest and ship it to Asian markets. However, it has hit numerous hurdles and met strong opposition from US community and green groups.

The Seattle-based Sightline Institute, a green-leaning think tank, prepared the report claiming many US stakeholders were of the mistaken belief that Ambre was a major, well-established Australian miner.

According to the well-researched report, Ambre will need almost $1bn to establish its two mooted US coal shipping terminals and to meet mine site reclamation agreements it inherited when buying its two mines, both in the US.

While start-ups usually require large amounts of capital, Sightline pointed to the fact Ambre had been operating for five years and had never made a profit, with revenues of $4.6 million last year against $70.2m in expenses.

‘One of the highest-profile players in the coal export arena is an Australian firm called Ambre Energy, which is planning two controversial export terminal projects on the Columbia River in Washington and Oregon,” the report says.

“But the coal export debate has largely overlooked a curious fact: Ambre Energy barely qualifies as a coal company. More than half a decade after it was founded, the company remains little more than a high-risk start-up struggling to establish a toehold in the coal business — suggesting that Ambre’s vision of lucrative coal exports may stem not from savvy experience but from equal measures of hope and hype.”

Ambre management attacked the report as “corporate character assassination” but would not comment on the issues raised.

“This report from an anti-coal organisation is typical of the material generated by these groups,” spokesman Andrew Crook said.

Ambre was forced to scrap a proposed $200m float last year and is seeking investors, with its auditors warning it may be unable to continue operating this year unless it is able to do so.


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