What we own

Kestrel is an underground coal mine located in the Bowen Basin, Queensland, Australia. It is operated by Rio Tinto Limited (‘Rio Tinto’). The Group owns 50% of certain sub-stratum lands which, under Queensland law, entitle it to coal royalty receipts from the Kestrel mine.

The royalty rate to which the Group is presently entitled is prescribed by the Queensland Mineral Resources Regulations. These regulations currently stipulate that the basis of calculation is a three-tiered fixed percentage of the invoiced value of the coal as follows: 7% of value up to and including A$100; 12.5% of the value over A$100 and up to and including A$150; and 15% thereafter.

Performance

In H1 2017, 88% of total sales by Rio Tinto at Kestrel were subject to the Group’s royalty compared to 38% in H1 2016.

In Q2 2017 alone this number was ~95% and we expect this number to be in excess of 90% for the remainder of the year.