Macarthur bogged down by water, mud removal

MACARTHUR Coal’s run of mine production dived 45.4% year-on-year during the March quarter while sales fell 61% with its two key mines still under force majeure as a consequence of the severe wet season in Queensland.

Blair Price

Rainfall poured into the two main working pits of the company’s key Coppabella mine with 466 millimetres clocked up over the recent quarter, causing significant delays.

The dragline continued with overburden and mud removal for most of the period, but pumps remain onsite to get rid of in-pit water.

“Efforts to restore the site to full operating capacity depend on the levels of rainfall received beyond the end of March,” Macarthur said in its production report today.

Macarthur’s Moorvale open cut mine was less affected, but it did receive 335mm of rainfall over a stretch of 36 days.

Total ROM production was 725,400 tonnes for the recent quarter compared to 1.33 million tonnes in the corresponding period of 2010.

With limited stockpiles before the wet weather, saleable coal production was just 0.52Mt compared to the 1.18Mt achieved in 2010 March quarter.

Overburden removal only slipped 5.9% year-on-year, providing Macarthur with opportunities to recover previous production levels and benefit from higher coal prices once the rain eases off.

Second-stage development of the Middlemount mine in the Bowen Basin is expected to start up mid-year and aims to lift output to 5.4 million tonnes per annum run-of-mine for the next 19 years starting from mid to late 2012.

The completion of a rail spur for the project is expected in late 2011.

NRW Holdings recently won a five-year mining services contract for the open cut project, which will kick off in July.

Located 6 kilometres from the Middlemount town, the mine will produce coking and pulverised coal injection coal.

Gloucester Coal acquired a 27.52% stake in the Middlemount joint venture from commodities trader Noble Group last year and has the right to acquire a further 2.48% from remaining project stakeholder Macarthur after a shipping milestone is reached.

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