TerraCom Ltd through its wholly owned subsidiary Orion Mining has successfully recommissioned the Blair Athol thermal coal mine in Queensland, Australia, and is on track to deliver first sales next month (August 2017). Orion will rapidly ramp up to approximately 2 Mt/y annualised rate in early Q4 2017.
Mining and rehabilitation activities have progressed on schedule to meet the first coal sale timeline. Bulk earthworks have commenced on the rehabilitation element of the operation, which is being conducted in accordance with the requirements defined in the Environmental Authority.
Initial overburden has been removed and placed in its final position to facilitate the first coal extraction. The first month’s coal production has been surveyed in-situ and the entire site is being readied for the first coal sale.
Key activities performed or commenced enabling successful and sustainable operations include; safety and health management system integration and enactment, facilities recommission, full mobile fleet upgrade, site road maintenance, and along with commencement of the dragline overhaul.
Orion has received notice of the decision from the Department of Environment and Heritage Protection (DEHP) as a delegate of the Environmental Protection Act 1994 (EP Act), and in accordance with section 295(1) of that Act, on the amount and form of financial assurance (FA) required for the Blair Athol coal mine authorised under mining lease (ML) 1804 and Environmental Authority (EA) EPML00876713. This decision relates to the replacement plan of operations lodged by Orion for the plan of operations period 20 June 2017 to 21 June 2018.
The DEHP decision stated that the total cost of rehabilitation for the mine is A$74,579,310, and that the form of FA remains unchanged. The decision was made by the delegate on the basis that the total rehabilitation cost of the mine of A$74,579,310 has been calculated in accordance with the requirements of the Department’s ‘Guideline – Financial assurance under the Environmental Protection Act 1994’.
A condition of the Indicative Approval granted to Orion from the Department of Natural Resources and Mines (DNRM) for the transfer of the mining lease for the Blair Athol mine was Orion was required to give the DNRM A$13,500,000 in cash as a security bond. This security bond was to be returned when Orion gives the DEHP the financial assurance required under the EP Act when Orion becomes the holder of EPML00876713. Orion is pleased to advise that the release of this security bond has been triggered.
Blair Athol is a significant milestone for TerraCom, bringing the following benefits:
•Progressive rehabilitation of one of Queensland’s oldest coal mines
•The resumption of coal mining and export sales from the Blair Athol mine providing the local, state and federal economies with increased economic activity, employment, royalties and taxation
•Forecast positive cash flow through a low overhead structure and operational efficiencies.
TerraCom has commenced over 50 ha of site rehabilitation while bringing back production. The operation, under TerraCom management, is planned to deliver approx. 2 Mt/y over seven years and ongoing progressive rehabilitation.
TerraCom has already fully commissioned the Baruun Noyon Uul (BNU) coking coal mine in the South Gobi of Mongolia. Export shipments under a 5.5 year offtake agreement have commenced on schedule. The company’s goal is to become one of the largest and highest quality coking coal producers in Mongolia, providing exceptional value for its steel-producing customers.
