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Solid Energy can be saved, chairman says

16:47 Thu Mar 7 2013

Solid Energy can be returned to profitability by 2015, a parliamentary committee has been told.

The state-owned coal mining company's chairman, Mark Ford, said a rescue plan was being negotiated and he was confident it would succeed.

"I am absolutely persuaded Solid Energy has a good future," he told MPs on the commerce select committee on Thursday.

"It will be a profitable company by 2015 - our plan has, I think, impressed our bankers."

The stricken company is carrying debts of nearly $400 million and Prime Minister John Key has described it as probably worthless.

But Mr Ford was upbeat in front of the committee, saying he had been appointed to turn it round and he was going to do that.

He said it would focus on coal mining and get out of the alternative fuel projects which helped create the crisis.

The government has said it won't let the company fall over and Treasury is part of the rescue negotiations.

Opposition MPs on the committee spent most of the hearing trying to find out what went wrong with the company. But Mr Ford, who was appointed in August, and interim chief executive Garry Diack, appointed last month, couldn't give them detailed answers.

Mr Ford said it was basically caused by a drop in the international coal price.

"We won't be surprised on that again," he said.

Labour MP Clayton Cosgrove said former chief executive Don Elder, who resigned on February 4, should be made to appear before the committee.

"The situation is unacceptable, $390 million is down the toilet and we can't get answers," he said.

Mr Cosgrove said the committee would consider what it could do to make Mr Elder front up, including issuing a subpoena.