The company said surface construction activities are nearing completion at three of the four main sites, being the coal loading facilities (Kemira Valley), mine surface facilities (Dendrobium) and the ventilation shaft.

Construction associated with the washery upgrade is currently ramping up. The project is approximately 25% complete with both of the underground access tunnels having reached the coal seam.

The first Dendrobium production crews are currently being recruited, BHPB said and just over 50% of the project's capital has been committed to date. The capital forecast and longwall startup schedule remain unchanged at US$170 million and May 2005 respectively.

Dendrobium will be a low cost underground longwall operation capable of producing 5.2 Mtpa of raw coal resulting in 2.6 Mtpa of coking coal and 1Mtpa of thermal coal. The main customer for the coking coal is the BHP Steel Port Kembla steelworks located seven kilometres from the mine site.