Solid Energy CEO Dr Don Elder said yesterday that over the last two years, the company has developed and implemented a series of “work around” mining plans for the Mt Augustus ridgeline area of the mine, while the company sought wildlife permits and collected the rare, native land snails (more than 5300 to date) found in the area.

 

The ridgeline area holds about 5 million tonnes of high quality coking coal. The coal at Mt Augustus, valued at about $NZ400 million, is needed to blend and raise the specifications of lower quality coal in other parts of the site to meet customer orders.

 

Snail collection is not scheduled to finish until the end of May, meaning that the company cannot access the last major area of ridgeline coal until late June.

 

More recently, anti-mining activists have also caused delays by occupying areas near the ridgeline and requiring the company to halt operations for safety reasons.

 

“We have now reached the point where we have no other areas of high quality coal that we can access to meet contracted customer orders,” Elder said.

 

“As the snail numbers have risen and necessitated further searches it has become increasingly more difficult to access high quality coal that we need to blend with lower quality coals for these export shipments.

 

“We have now had to tell these customers that we can’t meet their orders. They will have to buy substitute coal elsewhere, which will erode Stockton’s competitive position in the market.”

 

Solid Energy will cut production at Stockton from May 1 for about two months, from current monthly production of 180,000–190,000t to about 60,000t a month.

 

Production at Stockton was forecast to total 2.12Mt for the 2007 financial year, but is now forecast to be between 1.82Mt and 1.88Mt.