Quarter in line with previous December

REPORTING on the quarter ended December 2002, BHP Billiton (BHPB) said its coal divisions produced 8.4 million tones of metallurgical coal and 20.6 Mt of energy coal.

Staff Reporter

The figures were in line with the December 2001 quarter.

The company’s Queensland operations total output was 6.5 Mt. BHP said the figure reflects the resolution of adverse roof conditions at the Crinum longwall mine, and lower overall production at the Goonyella Riverside mine to ensure a sustainable balance in stockpile inventories. The bulk of BHPB’s Queensland production is open-cut with Crinum the only underground operation.

Shipments out of Queensland for the period amounted to 4Mt coking coal, 1.5 Mt weak coking coal and 800,000t thermal coal.

During the quarter energy coal production measured 20.6Mt. BHPB said decreases from the sale of the PT Arutmin energy coal assets in Indonesia were offset by higher production at New Mexico Coal in the US.

Production was 6% higher than the September 2002 quarter mainly due to maintenance on two draglines in the September quarter and commencement of the San Juan longwall operation at New Mexico Coal in the US.

San Juan went into production in October 2002 and is expected to ramp up to full capacity by March 2003. BHPB said longwall operations are ramping up as scheduled, with 372,000 tonnes produced in December. Project capital spending closed at the end of the year, US$3 million under the approved budget of US$146 million.

At the company’s Illawarra operations in NSW production totaled 1.9Mt. BHPB reported on progress with the Dendrobium mine development project.

Dendrobium is being designed to 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.

The project is approximately 20% complete with one of the two underground access tunnels reaching the coal seam in December 2002. Road tunnelling has shifted to coal production, with the project now producing development quantities of coal, according to the company. The ventilation shaft boring has been completed with the shaft lining 50% complete. Production crews will be recruited by June 2003.

Construction activities are continuing at three of the four main sites including the coal loading facilities (Kemira Valley), mine surface facilities (Dendrobium) and the ventilation shaft.

Construction will commence on the fourth main site, the washery upgrade and the installation of a thermal drier, in March 2003.

Approximately US$70 million has been committed to date. The capital forecast and longwall startup schedule remain unchanged at US$170 million and May 2005 respectively.