“The company has a deep pipeline of expansion projects to further develop its large reserves of high quality metallurgical coal,” BHP metallurgical coal president Hubie van Dalsen said.

“Our strategy is to rapidly progress development of these projects to capture the increasing demand we see for hard coking coal.

“Subject to further approvals, this initial investment will be followed in the near term by the construction of the Caval Ridge mine, which will utilise expanded Hay Point port capacity created from this investment.”

BMA will spend $900 million to develop a new mining area at the Broadmeadow mine.

While the mine life will be increased by two decades, annual production will also be boosted by 400,000 tonnes, taking the output to 4.8 million tonnes per annum once this project is completed in 2013.

Adjacent to BHP Mitsui Coal’s Poitrel mine, the Daunia mine will cost $1.6 billion to develop and is expected produce 4.5Mtpa of export metallurgical coal through a new processing facility, with first coal expected in 2013.

The $2.5 billion stage-three HPCT expansion will lift throughput capacity from 44Mtpa to 55Mtpa with first shipments from the bigger terminal expected in 2014.

To provide further protection from high seas and winds, the existing jetty will be replaced.

Work includes the construction of a new third berth and a higher trestle which will be beyond the 16.5-metre indicative swells which came courtesy of Cyclone Yasi.

Other items include associated surge bins and out-loading conveyors.

BMA is a 50:50 joint venture between BHP and Mitsubishi Development Corporation, with both parties sharing half the costs of the new investments.

The Caval Ridge project is targeting 5.5Mpta of metallurgical coal with first exports by 2014, but is also expected to process an additional 2.5Mtpa from BMA’s adjacent Peak Downs mine.