Rising costs do not deter Cliffs at Sonoma

CLIFF Natural Resources expects to continue producing thermal and coking coal from its 45%-owned Sonoma coal mine in Queensland’s Bowen Basin this year despite rising production costs.
Rising costs do not deter Cliffs at Sonoma Rising costs do not deter Cliffs at Sonoma Rising costs do not deter Cliffs at Sonoma Rising costs do not deter Cliffs at Sonoma Rising costs do not deter Cliffs at Sonoma

Sonoma mine location, courtesy of QCoal.

Lou Caruana

Cliffs' share of sales volume at Sanoma in the fourth quarter was 360,000 tons. Revenues and sales margin generated for Cliffs were $US58.9 million and $16.3 million, respectively. Revenue per ton at Sonoma was $163.78, with cash costs of $80.80/t.

For 2012, the company is maintaining its equity sales and production volume expectations of approximately 1.6Mt. The approximate product mix is expected to be two-thirds thermal coal and one-third metallurgical coal.

Cash cost per ton is expected to be approximately $110. For 2012, depreciation, depletion and amortisation is expected to be approximately $14 per ton.

Cliffs owns Sonoma with joint venture partners QCoal Sonoma, a privately owned Queensland resource company, the Japanese JFE Shoji Trade Corporation, Taiwanese China Steel and Hong Kong-based Watami Trading.

Established in September 2007, the mine's first shipment of coal product was railed in January 2008, with the first load of coal being shipped in February 2008.

Sonoma Coal produces coking and thermal coal products for export to countries such as Japan, Korea, Taiwan and China. It represents a 170Mt resource.

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