Illawarra Metallurgical Coal saleable production decreased by 17% (or 782kt) to 3.96Mt in the December 2015 half year as challenging geological conditions were encountered at the Appin and Dendrobium mines, and a planned longwall move was completed during the December 2015 quarter.

Another two longwall moves are expected to be completed in the March 2016 quarter, consistent with the mine plan.

As reported in International Coal News, the Appin Area 9 project is 95% complete, with commissioning expected to start in the March 2016 quarter.

The project, which sustains Illawarra Metallurgical Coal production capacity, is now more than 30% below the original budget of $US845 million and three months ahead of schedule.

South32 CEO Graham Kerr said: “Our relentless focus on safety, volume, costs and capital expenditure has allowed us to reduce net debt by almost $US300 million in the December 2015 half year, despite continuing weakness in commodity markets.

“Further decisive action will be taken as we seek to maximise short-term cash flow while preserving longer-term value.”