Wesfarmers output falls across the board

WESFARMERS had a tough March quarter, with output from all of its coal mines falling compared to the last three months of 2009.
Wesfarmers output falls across the board Wesfarmers output falls across the board Wesfarmers output falls across the board Wesfarmers output falls across the board Wesfarmers output falls across the board

Wesfarmers' Curragh operation.

Blair Price

Its wholly owned Curragh mine in Queensland was hit by some bad luck before Cyclone Ului and the recent wet season kicked in.

In January, a cable failure on the mine’s 20.02-kilometre overland conveyor took four days to rectify, although Wesfarmers expected the force majeure event to have minimal impact on customers due to its stockpiles at Gladstone’s port.

But the rough weather and its impact on mining and the state’s coal chain resulted in coal production at Curragh slipping 5.9% from the December quarter.

The mine produced 2.46 million tonnes for the March quarter, made up of 71% metallurgical coal and the remainder thermal coal.

Wesfarmers noted met coal production was 12% lower than the December quarter because of the wet weather conditions while thermal coal was 13.6% higher due to higher contracted demand.

The company pushed ahead with plans to expand Curragh to 8.5Mt per annum of met coal exports, with construction of the second coal handling and preparation plant underway.

Drilling at Curragh and Curragh North targeted the infill structural definition, with 68 chip holes completed during the recent quarter.

At its wholly owned Premier mine in Western Australia, thermal coal production was down 2.9% from the previous quarter to 670,000t, but this was due to lower demand from state-owned Verve Energy.

Wesfarmers has a 40% stake in the Bengalla open cut mine in the Hunter Valley, with its share of thermal coal production down 14.5% from the previous quarter to 0.49Mt.

A feasibility study investigating a ramp-up of raw coal production from 8.7Mtpa to 10.7Mtpa continued in the March quarter.

Wesfarmers shares are down 37c to $29.53 this morning.