MARKETS

Thermal price hastens need for Dudgeon Point

THE $A5 billion Dudgeon Point port development near Dalrymple Bay Coal Terminal is becoming a higher priority for the Queensland government as pressure mounts to lock in export capacity and benefit from soaring thermal coal prices.

Lou Caruana
Thermal price hastens need for Dudgeon Point

Wet weather and surging demand from both China and India has pushed the spot price of thermal coal to $US100 a tonne, above the current December quarter contract price of around $US97/t.

Goldman Sachs last month raised its 2011 thermal coal price target to $US105/t and expects coal supplies will tighten in the northern winter.

Dudgeon Point, which lies about 5 kilometres north of the Hay Point coal terminals owned by BHP Billiton and Dalrymple Bay Coal Terminal Management (DBCT), is expected to be the port of choice for Indian giant Adani Group, which recently paid Linc Energy $750 million for its coal exploration assets in the Galilee Basin.

DBCT, in conjunction with Adani and North Queensland Bulk Ports, is the preferred tenderer for a doubling of planned capacity at Dudgeon Point to 120 million tonnes per annum.

While first exports from Dudgeon Point were slated for late 2016, coal miners are believed to be pushing for a quicker approvals process and an earlier production date of 2015 to capitalise on historically rising prices and demand for coal.

DBCT has received requests from Anglo Coal, Rio Tinto Coal & Allied, BHP Billiton Mitsubishi Alliance, Xstrata, Peabody, Macarthur, Vale and Aquila Resources for 90Mtpa of additional capacity despite the fact that it currently has only 85Mtpa capacity.

After entering a six-month consultation and planning process involving North Queensland Bulk Ports and Adani, DBCT is expected to decide how the land will be allotted for development and then seek an allocation of land from the Queensland government.

TOPICS:

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining Monthly Intelligence team.

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining Monthly Intelligence team.

editions

Mining Magazine Intelligence Exploration Report 2024 (feat. Opaxe data)

A comprehensive review of exploration trends and technologies, highlighting the best intercepts and discoveries and the latest initial resource estimates.

editions

Mining Magazine Intelligence Future Fleets Report 2024

The report paints a picture of the equipment landscape and includes detailed profiles of mines that are employing these fleets

editions

Mining Magazine Intelligence Digitalisation Report 2023

An in-depth review of operations that use digitalisation technology to drive improvements across all areas of mining production

editions

Mining Magazine Intelligence Automation Report 2023

An in-depth review of operations using autonomous solutions in every region and sector, including analysis of the factors driving investment decisions