BHPB ups coal ante

SKYROCKETING demand for seaborne metallurgical coal has driven BHP Billiton to action, with the diversified major announcing Wednesday it will increase metallurgical coal production capacity to around 100 million tonnes per annum by 2010.
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Courtesy BMA

Angie Tomlinson

Increased capacity will be achieved through high value incremental expansions of the BHP Billiton Mitsubishi Alliance (BMA) and BHP Mitsui Coal (BMC) coal operations in Queensland and potential new developments such as the Maruwai prospect in Kalimantan.

Options for expanding BHPB’s Illawarra coal business in New South Wales are also under consideration.

“BHP Billiton and its partners are ideally placed to capture a significant share of the forecast growth in the metallurgical coal market through the addition of low cost, high value production capacity,” said carbon steel materials group president Bob Kirkby.

In March this year BHPB outlined plans to increase capacity at its Queensland coal operations from 52Mtpa to 57Mtpa by mid 2005. This project included the purchase of additional mining equipment at several mines, upgrades to the coal preparation plants at the Saraji and Peak Downs mines and the awarding of 132 million bank cubic metres (Mbcm) of overburden stripping contracts.

Kirkby said the next stage of the Queensland coal expansion program will increase production capacity to 59Mtpa by the second half of 2006. Capital expenditure for this stage will be US$175 million (BHPB share US$87.5 million) and includes increasing throughput capacity at the Hay Point Coal Terminal from 34Mtpa to 40Mtpa and the acquisition of additional stripping and mining equipment.

To facilitate increased production, 32Mbcm of overburden stripping contracts will be let at the Saraji mine.

On completion of the expansion projects in 2010, BHP Billiton’s attributable production capacity is expected to rise to in excess of 60Mtpa.

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