Blakefield fire costs Xstrata $63M

THE ignition incident at Xstrata Coal’s Blakefield South longwall mine in New South Wales in January has already cost the company $63 million in the first half, with no resumption of production in sight.
Blakefield fire costs Xstrata $63M Blakefield fire costs Xstrata $63M Blakefield fire costs Xstrata $63M Blakefield fire costs Xstrata $63M Blakefield fire costs Xstrata $63M

Commissioning the new Blakefield South longwall, image courtesy of Xstrata Coal.

Lou Caruana

The impact of the fire contributed to a 6% decline in Xstrata’s Australian coal operating profit for the half to $448 million.

Blakefield South was designed to replace Beltana, which was an Australian longwall production leader for several years.

Blakefield South’s new longwall was commissioned in June 2010 and production capacity was estimated to be around 4 million tonnes per annum in December.

For the 12 months to June 2011, Beltana and Blakefield South produced a combined total of 5.09Mt of raw coal, according to statistics provided by Coal Services.

While Beltana was scheduled to cease mining at the end of 2010, the last panel is still being extracted.

The majority of the Blakefield South workforce has been redeployed to other Xstrata mines, such as Ravensworth North and the nearby Beltana mine in the Upper Hunter Valley.

Other Xstrata coal operations were also drags on the company’s profits: the flooding of the Ulan mine cost the company $68 million and the impact of Queensland flooding on open cut coal operations was $79 million.

Despite a rapid recovery at the majority of Queensland mines, damage to rail infrastructure prevented domestic and export sales from the Rolleston operation for two months.

These events reduced the company’s planned coal production by about 4.7Mt.