The project’s draft feasibility study had operating costs estimated at $65.61/t.

“Since completing the definitive feasibility study, Bandanna Energy continued detailed work during the reporting period to optimise planned coal production from the project,” the company said in its March quarterly report.

“Independent external mine planning has confirmed that a single longwall at Springsure Creek is now forecast to produce more than 7 million tonnes per annum in line with similar experience at modern high production longwall projects both within Australia and overseas.”

Bandanna Energy has appointed Ausenco to provide project management advice, engineering support and procurement services.

Ausenco is on track to deliver an engineered budget, schedule and execution plan for the project by 30 June 2014, Bandanna said.

“At completion of the services, Bandanna Energy expects to have in hand competitively tendered and priced packages for all development services aligned with the expected timing for the grant of ML70486,” the company said.

“The key deliverable under the agreement with Ausenco will be an enhanced definitive capital value for the Springsure Creek Coal Project, as well as providing plans for project management and project execution.”