Expected to produce about 30 million tonnes per year, the proposed project has been shelved as part of the company’s decision to implement cost cuts and as coal market prices drop to a three-year low.
A Glencore Xstrata spokesman was quoted by AFP as saying that the company has invested considerable amount of capital and human resources in the project to date and the company considers it ‘a valuable asset and important future option’.
"However, as a result of the current over-supply, low prices and other challenges in the global coal market, we have placed the project on hold in the short-to-medium term," the spokesman added.
The Australian coal project halt follows a drop in demand in China and other economies as well as oversupply dragging down prices from China and Mozambique.
Covering approximately 32,000 hectares, the proposed mine may include an open-cut coal mine, a coal handling and preparation plant, and support facilities.
