Last year saw unprecedented growth in the Bowen Basin, with the Australian Bureau of Agriculture and Resource Economics (ABARE) reporting that of the seven new coal projects completed in Queensland in 2006, all were located within the central Queensland area. Five of the seven new projects were new mines and two were expansions.
New mines included Anglo Coal Australia’s $275 million Grasstree mine, northeast of Emerald, which will produce around 5 million tonnes a year of coal.
AMCI Australia, which was recently bought out by Brazilian giant CVRD (Companhia Vale do Ro Doce), is another major producer in the region ramping up its operations. The company’s $136 million Carborough Downs joint venture and Broadlea North operations will produce 5Mt of coal per annum combined when both to become fully operational in 2009-2010.
US-based company Peabody also opened the $161 million Millennium opencut mine after acquiring Australian company Excel Coal late last year. Millennium is expected to produce 1.5Mt of coking coal a year.
The Red Mountain JV between Peabody and BHP Mitsui Coal (BMC) also brought online the $115 million Millennium coal preparation, handling and rail project, which has a throughput capacity of 6Mtpa.
According to ABARE, the two coal expansion projects completed in 2006 were Rio Tinto Coal Australia’s (RTCA) $300 million Hail Creek mine extension and BHP Billiton Mitsubishi Alliance’s (BMA) Stage 2 $236 million coal expansion project across its Bowen Basin mines including Broadmeadow, adding around 4.5Mtpa to the region’s output.
Also officially opened last year but not included in ABARE’s figures was Minerva, the third operating mine for Australian company Felix Resources. Minerva is 40km south of Emerald and is expanding to 2.5Mtpa production capacity of thermal coal.
Another project that came online late last year was the Isaac Plains JV between CRVD-owned ACMI and smaller company Aquila Resources, where an opencut mine began coal production late last year and will reach full capacity by 2009-2010.
The most recent operation to come online in the region has been Caledon Resources’ Cook mine, which began production this week. The company anticipates producing 50,000t of coal per month, rising to 100,000t by the third quarter this year, or around 1.5Mtpa for at least a 10-year mine life.
Construction at the Moolarben project, the newest mining prospect for Felix, is scheduled for the middle of this year, allowing the first coal to be available for shipping from the opencut mine by the end of 2008.
The company also plans to develop a longwall at Moolarben within three years of the opencut commissioning, at a production rate of 4Mtpa of thermal coal.
RTCA announced in January this year that it would be developing its 190Mt Clermont thermal coal deposit, 15km east of its massive Blair Athol Mine.
The new opencut mine is expected to produce up to 12.2Mt of thermal coal a year when it reaches full capacity in 2013, and RTCA said it is expected to have a life of about 17 years at this production rate. Coal production is scheduled to begin in 2009 when operations at the Blair Athol mine cease.
BMA is the biggest single player in the Bowen Basin. Overall, BMA produces 60Mtpa from its mines in Australia, which include the Goonyella, Peak Downs, Saraji, Norwich Park, Gregory, Crinum and Blackwater mines in the Bowen Basin.
BMA also operates two other Bowen Basin coal mines – Riverside and South Walker Creek – for BHP Mitsui Coal.
In late 2006, BMA invested in a new $40 million high capacity longwall system at its Broadmeadow mine, which is expected to be completed in March 2008.
The development of the Norwich Park East Pit is expected to increase production at Broadmeadow from 4.6Mtpa to 5.7Mtpa and also extend the life of the mine.
BMA also has some 3.15 billion tonnes of inferred and indicated resources, which are yet to be developed in the region and the company has said it is looking to increase its production from the region to 80Mtpa.
Anglo Coal, the third major operator in the region, is continuing its $835 million Dawson project, a major expansion upgrade of the Moura mine (now called Dawson Central).
The Dawson expansion is expected to increase production to 12.7Mtpa of coal, with Anglo Coal also planning on building a new coal handling plant and associated coal-handling infrastructure to cater for the additional throughput. The mine is planned to reach full production sometime this year.
Anglo Coal has also begun construction on the $516 million Lake Lindsay greenfield project at its German Creek mine, which is scheduled to produce 3.7Mt of metallurgical coal and 300,000t of thermal coal annually by 2008.
Finally, Ensham Resources has also put into play expansion operations for the Korean and Japanese-owned Ensham project. The project currently produces around 9Mtpa of coking coal, and the $600 million re-development of the project is expected to more than increase that by 2009.
While the dominant players in the region are taking full advantage of the global demand for coal, there are a number of smaller and mid-tier companies looking to make the move from explorer to producer or bring new projects online in the next few years. Names and projects to watch out for include:
Macarthur Coal – Olive Downs, Moorvale West and West Walker
Bowen Energy – Cockatoo
Northern Energy – Yamala
Aquila – Peak Downs and Belvedere
Qcoal – Sonoma
Cockatoo Coal – Wonbindi and Dingo