SURFACE

Rain takes its toll on Yancoal production

HEAVY rainfall associated with the La Niña weather cycle disrupted mining, rail and port activity during at Yancoal’s New South Wales coal mines in the March quarter with 8.7 million tonnes of attributable saleable coal produced compared to 9.7Mt in the previous corresponding period.

 Revision to the mine plans, the timing and the type of coal produced are adversely affecting Yancoal's operating unit costs.

Revision to the mine plans, the timing and the type of coal produced are adversely affecting Yancoal's operating unit costs.

Yancoal CEO David Moult said the company's three large opencut mines in the New South Wales continued to assess the flooding impacts and establish recovery plans.

"We currently expect the revised mine plans to enable Yancoal to deliver the 2021 target of around 39 million tonnes of attributable saleable coal," he said.

"Revision to the mine plans, the timing and the type of coal produced are adversely affecting operating unit costs.

"Consequently the full-year cash costs are being pushed to the top end of the guidance range."

The company is forecasting cash operating costs, excluding royalties, of A$60-62 per tonne for FY2021.

"The capable teams at each of the sites are working diligently to mitigate the cost pressure," Moult said.

"Cost guidance is retained at this time while the recovery plans are progressed further.

"Despite the recent disruption to ship loading capacity at Newcastle and flood-affected logistics through the Hunter Valley, Yancoal has the rail and port allocations required to match its production guidance for 2021, so we do not anticipate logistic constraints will affect the guidance."

Moult said the coal price indices continued to recover from the cyclical low in 2020, and the trend was constructive for the 2021 outlook.

"As always, our focus is on the controllable elements of our business, particularly optimising production and reducing operating costs wherever possible," he said.

"This is particularly the case after the production lost during the first quarter due to bad weather.

"Yancoal's low cost of production and ability to blend its output to meet customer requirements mean we are well placed to benefit from the improving market conditions."

 

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining Monthly Intelligence team.

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining Monthly Intelligence team.

editions

Mining Magazine Intelligence Future Fleets Report 2024

The report paints a picture of the equipment landscape and includes detailed profiles of mines that are employing these fleets

editions

Mining Magazine Intelligence Digitalisation Report 2023

An in-depth review of operations that use digitalisation technology to drive improvements across all areas of mining production

editions

Mining Magazine Intelligence Automation Report 2023

An in-depth review of operations using autonomous solutions in every region and sector, including analysis of the factors driving investment decisions

editions

Mining Magazine Intelligence Exploration Report 2023 (feat. Opaxe data)

A comprehensive review of current exploration rates, trending exploration technologies, a ranking of top drill intercepts and a catalogue of 2022 Initial Resource Estimates and recent discovery successes.