New rail link to buoy coal exploration and development

Northern Energy has welcomed plans by inland rail promoter Australian Transport and Energy Corridor to build a rail link between Moree and Toowoomba as a further boost for Northern’s Ashford coal project and potential new exploration areas.

This new cross-border rail link is proposed to connect with the Surat Basin railway, from Toowoomba to Gladstone, which is scheduled for completion by 2012. NEC Managing Director Keith Barker said the proposed Border railway would traverse close to the company’s Ashford project and new exploration application areas in northern NSW and southern Queensland.

“The Border Railway will potentially bring a high-standard, modern, transport connection closer to our Ashford hard coking coal joint venture and enhance the prospects for this project’s development,” he said.

“Development of the Ashford project is currently constrained by the lack of heavy-haul rail infrastructure in the region. There is also a current lack of capacity through the coal chain from Gunnedah to Newcastle.”

The Ashford project is 10 km north of Ashford and about 60 km north of Inverell in northern NSW. While Hunter Valley coal chain constraints are being addressed through further capacity additions, until now there has been no definitive plan to enhance rail haulage capacity in the Ashford region.

“We are continuing to examine options for an earlier development of the Ashford project and this proposed Border railway link by 2013 should provide a much more robust transport solution for development of the high-quality, hard, coking coal at Ashford,” Barker said. “This type of coal is a relatively scarce commodity and a vital ingredient for the global steel industry.

“As part of a much larger rail network, ultimately linking Gladstone with Melbourne, this link would provide the Ashford project with options to rail through Newcastle or Gladstone and possibly Brisbane.”

The proposed rail link will also pass close to, or through, the new coal exploration areas that Northern applied for earlier this year. These areas are expected to be granted shortly and our objective is to of explore for both Ashford-style, hard, coking coal in NSW and the Walloon coal measures, similar to Northern’s Elimatta coal project in Queensland. The location of these areas relative to this new rail link will enhance prospects for the development of any coal resources discovered in these areas, Barker said.