Gloucester continues underground quest

DESPITE rising royalty and fuel costs, Australian junior Gloucester Coal managed to record a profit of $A8.5 million for the first half of the year as it continued to move forward with its exploration and development program in New South Wales.
Gloucester continues underground quest Gloucester continues underground quest Gloucester continues underground quest Gloucester continues underground quest Gloucester continues underground quest

Courtesy Gloucester Coal

Angie Tomlinson

Gloucester chairman Andy Hogendijk said the profit was particularly pleasing in that revenue from higher priced coal contracts were not realised until May.

During February Gloucester settled contract prices of more than $US100 per tonne with Japanese steel mills for the 2005/06 Japanese financial year (beginning April), a record for the company and in line with market expectation.

For the September quarter FOB cash costs at the company’s open-cut operations hit mid-$A40’s, a 12% rise over 12 months. Gloucester said royalties on coking coal accounted for more than half the cost increase, while higher oil prices increased mining costs by about $A1/t.

Sales volumes for the quarter were up 37% to 491,000 tonnes.

On the exploration front, Gloucester said it planned to extend the Duralie open-cut highwall into low strip ration coal over the proposed trial underground area and had optmised the potential underground entry.

The company said this would add about 1Mt to Duralie’s mineable reserve (not JORC compliant).

Gloucester has also commissioned the reprocessing of more than 10km of seismic traverse data over the prospective deeper underground resources to the north of the Duralie mining lease.

Gloucester shares closed yesterday at $A3.55.

Most read Archive

topics

loader

Most read Archive