The company has reached an agreement with Stanwell, which will underpin the increase in Curragh mine metallurgical coal sales from the current 6.5 – 7.0 mtpa to 8.0 – 8.5 mtpa from late 2011, subject to market conditions.
Under the terms of the agreement, Wesfarmers Curragh will gain access to an additional 46 million tonnes of reserves currently held by Stanwell in the Curragh North mining area. Stanwell will benefit through a new export rebate formula linked to Curragh metallurgical coal sales above seven mtpa.
The expansion will include the construction of a new stand-alone coal handling and preparation plant as well as mine infrastructure at a cost of $286m and is expected to be completed by late 2011.
Stewart Butel, managing director of Wesfarmers Resources, said: “This expansion will further lift the long term prospects for Curragh and ensure that we can take advantage of the forecast increase in seaborne metallurgical coal demand.
“It will provide additional employment at the mine both during the construction phase and in the longer term. Our customers will benefit from increased metallurgical coal supply and the Queensland State Government will receive higher royalty collections.”
Wesfarmers has contracted rail and port capacity in place to support the increase in metallurgical coal sales from the Curragh mine. The necessary approvals to operate the mine to facilitate exports at an 8.0 – 8.5 mtpa rate have been granted and all approvals to allow expansion works to commence are in place.
