NWR's Paskov mine aid deal looks set for renegotiation -Czech minister

PRAGUE, Aug 26 (Reuters) - The Czech government and New (KOSDAQ: 160550.KQ - news) World Resources (NWR) are likely to have to renegotiate the state support aimed at extending the life of the company's Paskov mine, Industry Minister Jan Mladek said on Wednesday.

The state agreed in 2014 to provide 600 million crowns ($25.2 million) to cover the social costs of NWR closing Paskov if the company kept the unprofitable mine open until the end of 2017.

However, the deal would become invalid and need to be reworked if coking coal benchmark prices drop below $110 a tonne for three straight quarters.

The benchmark was below the threshold in the second and third quarters and Mladek said that NWR's main mining unit OKD expects the price to be below the stated level when it is set for the fourth quarter during September.

Without a valid deal in place, NWR would be free to close the mine at a time of its own choosing.

"It (Other OTC: ITGL - news) is necessary to resume negotiations in advance to protect against a massive layoff of miners," Mladek said in a statement.

NWR declined to comment.

The company went through a major debt and equity restructuring in 2014 to avoid insolvency. As part of an operational review in 2013, it looked to close Paskov after concluding that it would continue to operate at a loss in the medium term because of high costs.

Its deal with the government requires the company to employ at least 1,800 people at the mine until 2017, though NWR has said this year that it could keep the mine open longer after bringing down costs. ($1 = 23.7850 Czech crowns) (Reporting by Jason Hovet; Editing by David Goodman)