The signing of the contract with Macquarie Generation to supply its Bayswater Power Station in the Hunter Valley, effectively paves the way for the development of the Anvil Hill open-cut mine. Centennial will supply 30 million tonnes of coal from the mine over 12 years, commencing in early 2008.
Detailed mine planning and preparation of an Environmental Impact Statement are underway. The company expects to lodge the formal application for a mining lease in mid-2005 and will continue community consultation to outline the development proposal to stakeholders.
Centennial’s new Mandalong longwall project is on track to commence longwall production in January 2005.
Longwall equipment is being progressively delivered throughout October. All but 36 of the 68 Joy 2 Leg 1053-tonne shields have been delivered and are undergoing compatibility at the moment with the Joy 7LS6 shearer. The mini-build has been successful with break up scheduled in two weeks time. The bulk of the equipment, starting with the maingate and AFC, will start going underground on November 20.
Centennial reported good progress in construction and development activities during the quarter. The men and materials drift was completed with operations subsequently transferred from Cooranbong to Mandalong on October 15. Surface infrastructure including civil works for the workshop and fuel/oil storage, construction of the bulk store, bathhouse and sewer is essentially complete. The underground decline, conveyor systems and bin installation are all on schedule. Electricity supply for the mine including substation and transmission lines was completed in the quarter.
The company’s September acquisition of a new exploration area adjacent to Mandalong, containing an indicated resource of 136Mt of coal, will boost export opportunities and extend the mine life of the project.
During the quarter Centennial secured a 21-year lease over the Lidsdale Siding rail loading facility, adjacent to the company’s Springvale mine in the Western Coalfield. The facilities has been upgraded to accommodate larger trains and to reduce loading and freight costs on export coal.
“Centennial is responding to the strength in the export market utilising low-cost incremental production opportunities. The acquisition of the Lidsdale Siding provides a low-cost rail access point in support of this greater export focus,” the company said.
Group run of mine (ROM) production for the quarter totaled 3.65 million tonnes, 4% below the prior corresponding period. The main contributors to the drop were the stopping of underground mining at Ivanhoe in March 2004, the sale of the Company’s interest in the Cook Colliery in Queensland and the move from production to development activities at Mandalong at the end of the September 2003 Quarter.
Production from the Newstan longwall mine was below expectations due to faulting and difficult ground conditions but these improved in October and are expected to continue to improve in the December Quarter.
The export-led expansion of capacity at Charbon and Clarence bord and pillar mines is well underway with production at both operations steadily increasing. Some of the new equipment planned to be introduced has already been commissioned, making an immediate contribution. The majority of this new equipment will be installed in the current (December 2004) quarter.
“Centennial’s full year result is on track to surpass that achieved in 2004, with second half production and sales boosted by the commencement of longwall operations at Mandalong,” said Bob Cameron, managing director.
Centennial owns interests in the following New South Wales coal mines: Angus Place longwall mine, Clarence bord and pillar (85%), Charbon bord and pillar (95%), Springvale longwall (50%), Newstan longwall, and the Awaba, Munmorah and Myuna bord and pillar mines.