WDS spends up on underground equipment

UNDERGROUND coal contractor WDS says it has increased its capital expenditure to ensure it can undertake large-scale mine development works in the future beyond its existing contracts with Xstrata at Oaky Creek and Peabody at Metropolitan and North Goonyella.
WDS spends up on underground equipment WDS spends up on underground equipment WDS spends up on underground equipment WDS spends up on underground equipment WDS spends up on underground equipment

Working at Oaky North.

Lou Caruana

WDS continued to expand its services and geographic spread last financial year resulting in strong growth, particularly in the Queensland Bowen Basin, and is committed to purchase two reconditioned continuous miners, two reconditioned shuttle cars, eight load haul dump machines and three personnel transporters.

WDS continued its strong revenue performance from last financial year, helped by existing contracts, a high level of construction activities and the high utilisation of its continuous miners and other specialised mining equipment.

The continued demand for maintenance and support services in both Queensland and New South Wales also benefited WDS and further positioned the business well, it said in its annual report.

In the 2011 financial year, WDS won a three year contract extension for the supply of outbye services for Xstrata Coal’s Oaky Creek Coal complex, to provide support services to the Oaky No.1 and Oaky North longwall mines.

The scope of work is one of the most extensive arrangements of its type ever undertaken in Australia, with personnel supplied peaking at 250 WDS staff during the year.

WDS also embarked upon expanded work scopes at both the North Goonyella and Metropolitan mines for Peabody.

An initial project began for Yancoal at its Austar site in FY2011.

WDS’s mining division achieved high utilisation of its existing plant over the past two years, necessitating an increase in the fleet.

Mining however, faced continued pressure on margins caused by a number of factors, including: competitive bidding for projects; a tighter labour market leading to a reduced pool of experienced and available people as well as increased training costs for new entries into the business; and reduction in workflow at the workshops at Central West and Mackay resulting in cost under-recovery.

“The implementation of a new asset maintenance and management system for WDS Mining plant and equipment is now complete and the subsequent site integration will enable a significant improvement in plant and equipment maintenance and management programs,” WDS said.

“The result has been an improved understanding of utilisation and maintenance costs, thereby enabling higher utilisation rates, increased revenues, lower maintenance costs and improved compliance. This allows better planning of scheduled maintenance activities, improved workshop utilisation, increased asset life and reductions in asset replacement costs.”

During FY2011, NSW and Queensland mining projects were grouped into north and south regions for each state, headed up by newly appointed area managers to provide greater scrutiny of the individual projects and also place a greater emphasis on business development.

“This has led to improved returns for the Queensland projects in particular, and will sustain further growth of the business,” WDS said.

“Following reduced work-flow at the workshops in the early part of the year, the engineering management team have revised tendering and delivery procedures, with profitability steadily improving.

“FY2011 has realised strong results for WDS Mining with improved safety performance and increased returns. The division continues with a strong client base and work pipeline, coupled with the depth and quality of our services and people. We are in a strong position to capitalise on all new growth opportunities.”

In March 2011 Whitehaven Coal extended WDS’ involvement at its Narrabri operations by issuing a new two-year contract to WDS Titeline, for surface in seam and vertical production drilling, including well management for gas drainage works at Whitehaven’s Narrabri coal mine in NSW.