Future drilling at its Kerlong, Belview and Emerald leases will be prioritised by proximity to sealed roads to allow the earliest start possible once there is a break in the wet season, but Stanmore has not ruled out further stoppages due to weather events, including cyclones.

“Given the continued La Nina event, there is a high risk of continued weather delays as we head into the traditional wet season of January to March,” the company said in its quarterly report.

“Recent flood damage to the Queensland coal industry and related infrastructure and the consequent price rises in thermal, coking and PCI coal has served to highlight structural shortages on the supply side of the seaborne traded coal market.

“Stanmore Coal is well positioned to take advantage of long-term strength in the coking coal market in particular, with drilling at a number of prospective and potentially significant coking coal exploration projects due to be undertaken this year.”

On the infrastructure front, Stanmore has lodged a bank guarantee of $955,000 in support of an application for 7 million tonnes per annum of capacity at the WICET stage 2 coal terminal in Queensland.

The guarantee is considerably less than the company envisaged in late 2010 and will be utilised by WICET to undertake a detailed feasibility study.

“Stanmore Coal is working with WICET toward the satisfaction of due diligence requirements during 2011 in advance of a planned capacity commitment deed which will commit the company to a take-or-pay agreement,” the company said.

The stage 2 WICET expansion is scheduled to open in 2015, coinciding with Stanmore’s plans for first coal from Mackenzie River and The Range.

The 7Mtpa application represents 2Mt from the Mackenzie River project and 5Mt from The Range.

Stanmore has also begun discussions with Abbot Point Coal Terminal regarding access for any possible future mining development at the Kerlong project, near Moranbah.

The company is also holding discussions with the Surat Basin Rail consortium. Stanmore expects that the next milestone for this rail line will be the call for funding guarantees, which is likely in the first half of the 2011 calendar year.

“Constructive discussions” have also been held with QR National regarding allocation on the Blackwater and Moura lines to allow exports from Mackenzie River via WICET stage 2.