Building on its strong Chinese presence, Industrea has signed a A$2.5 million contract to supply an AMT directional drilling and methane gas drainage system, associated training and equipment to Jincheng’s Sihe coal mine in Shanxi Province. The mine is an existing AMT and Wadam customer already running four gas drainage systems.

The new contract follows recent Chinese contract wins for China Shenhua Energy (A$20 million), Inner Mongolia Yitai Coal ($6.2 million) and Shanxi Asian American Daning Energy (A$2 million). The state-of-the-art directional drilling system will be built in the Hunter Valley, New South Wales, for supply to Shanxi Jincheng Anthracite Mining Group.

Industrea Managing Director and CEO, Robin Levison, said Industrea had now won around A$110 million of new contracts in the 2009/10 financial year, predominantly to the Chinese underground coal mining industry. “Our world class directional drilling technology allows our customer to safely remove gas at high volumes from a coal seam,” Levison said.

“We are now moving into the next phase of our Chinese growth strategy with the development of recurring revenue streams from not only new equipment sales, but also from training, maintenance, spare parts and support services, which are an increasingly important aspect of winning and maintaining customer loyalty. To facilitate this revenue growth, Industrea has established a new product support centre in China capable of supplying a range of equipment spares across our key product ranges, alongside offering the required technical expertise in meeting the servicing and maintenance needs of our customers in the region.”

Levison said Industrea had recently achieved registration of subsidiary Industrea Wadam (Beijing) Technical Services as a Wholly Foreign Owned Enterprise in China, with new office premises leased in Beijing. To enhance the existing Chinese senior management capability, the new entity has appointed an Operations Manager to streamline supply chain management, while a new Chief Accountant has been hired to ensure seamless integration with the group’s financial reporting requirements in Australia. “These new managerial appointments in China, along with the enterprise registration, are important milestones in building our infrastructure and capabilities in the growing Chinese market,” Levison said.

China is forecast to nearly triple coal-fired generating capacity by 2030 from the 2006 level, with substantial investment anticipated in both coal mining and coal transportation infrastructure, according to the US Department of Labour’s Energy Information Administration. “Industrea is ideally placed to benefit from the growth in China’s coal industry, and our mining productivity and safety-boosting equipment is set for strong sales growth as we expand our position in the world’s biggest and fastest-growing market for commodities,” Levison said.