Published in June 2007 Australian Longwall Magazine

With Australian-based Wadam Industries as its agent and supported by Advanced Mining Technologies (AMT), VLD has been demonstrating and promoting its directional drilling and gas drainage systems in China since 2001, with 15 systems now operating at mines owned by the likes of Shenhua Group, Shanxi Coking Coal Group, Asian American Coal and Heilongjiang Longmei Mining Group.

VLD managing director Chris Freer said the company’s main strategy is to demonstrate directional drilling and gas drainage to the standard utilised in Australia.

In China’s deep and gaseous coal mines, VLD’s in-seam directional drilling enables more efficient and successful gas drainage – with its first installed system at Daning in 2003 and two more drill systems added since, this mine has now completed over 550,000m of directional drilling.

VLD is also involved in a project to drain methane from a highly gassy 20m coal seam at a Shenhua Ningxia Coal Mining Group mine along with Mitchell Drilling and AMSI/CAMDA.

After other companies tried and failed to bring directional drilling to China in the 1990s, Freer said VLD has approached the Chinese market by offering a complete system approach – equipment, installation, training and ongoing support.

“As the Chinese industry moves forward, they’re moving towards western-style longwall mines that require high productivity to make them pay, and that’s where our directional drilling comes in,” he said.

The demand for the directional drilling systems in China is being fast-tracked by a government focus on mine safety and increased financial assistance for new safety equipment and technology.

“The main outcome from directional drilling is improved productivity and it drags along safety with it,” Freer said.

“Most mines are now able to achieve a duty-free status on our systems for importation of machinery and technology, which is an extra incentive on top of increased productivity and safety.”

Freer said a complete directional drilling system sale takes about 12-18 months from the time the auditing process begins through to actual delivery.

“In conjunction with Wadam and AMT we put together a full system, it’s not just a drill rig, it’s the complete directional drilling system including all the peripherals – guidance tool, drill rods, equipment-carrying trailers, recovery equipment, spare parts and consumables.

“One shipment is usually two 40-foot containers and a 20-footer. We literally open the containers onsite in China and begin operating with them in about a week.”

VL then supports the installation with an extended training program, which usually lasts about six months.

“Further to that, we give ongoing support to our clients because to underpin the business we’ve got to get that long-term support, even though it’s a cost to us, it helps promote our products even further in China.”

Last year, the Valley Longwall Group established Valley Longwall Mining Equipment (Beijing) to showcase its products to the Chinese coal mining industry and house its drilling and diesel-related products.

VLD now employs eight Australian expats to carry out sales, training and support in China, but says the company is slowly growing its employment numbers by training local workers and engineers.

“Our aim is to grow a capability in China to improve our national support over there – we have about 20 nationals working for us now, but we expect it to increase along with business growth,” Freer said.

Meanwhile, the company has just been through a sale process where it has been able to attract venture capital company Catalyst to help it grow toward an expected initial public offering to the Australian Securities Exchange within the next three years, building on its track record of profitable growth.

Valley Longwall is now well placed for its next phase in growth, including seeking sales opportunities in Russia, ex-Soviet Union and Eastern European countries where the resource industries are growing rapidly and economies are improving.

“Recent mining disasters in Russia’s Kuzbass region have spurred coal companies in that area to look seriously at technologies and expertise that can assist in improving safety and productivity,” Freer said.