The continued shortfall is expected because of delayed access to higher-yielding coal while a transport infrastructure corridor is being removed at Coppabella.

Majority mine owner Macarthur Coal said yesterday the December quarter drop was caused by a drill and blast failure, along with heavy rainfall last month and port congestion.

Further issues at Coppabella during the quarter were the poorer quality coal mined in the Johnson pit, and the inability to perform optimal blending because of insufficient pit inventories and stockpiles.

The production shortfall means Macarthur may be forced to cover its contractual commitments for the current 2003 Japanese financial year by supplying any outstanding tonnage in the next financial year, but at 2003 prices.

Macarthur has proposed to ramp up ROM production using a second contractor, and to ensure stock levels are high enough for optimal blending. The company said it would also try to match shipments with periods of reduced congestion at the port.

Macarthur owns 73.3% of Coppabella, where the production capacity of saleable coal is 4.2Mtpa.

The mine received roughly three times the month's average rainfall in December, which disrupted operations for 12 of the 29 available days.

On the brighter side, mining has commenced at the nearby Moorvale mine, where Macarthur owns a 73.3% interest. The operation has an upgraded first year sales target of 1Mt of saleable coal.

The operation is almost developed with the finishing touches being made this month with testing of the coal preparation plant and electrification of the rail spur and loop.

Macarthur Coal has been involved in both operations from a grassroots stage.

MiningNews.net, Thursday, January 29, 2004.