Tag Archives: metallurgical coal

Thiess secures four-year contract extension at BMA Caval Ridge

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Thiess says it has been awarded a four-year contract extension with BHP Mitsubishi Alliance (BMA) for the Caval Ridge metallurgical coal operations in Queensland, Australia.

With a revenue of A$580 million ($383 million), the contract sees the company continuing to provide mining services at the Caval Ridge mine, operating and maintaining mining equipment to move overburden to support BMA’s production requirements. The extension continues the relationship with BMA at Caval Ridge, which commenced in December 2017.

Thiess Group Executive Chair and CEO, Michael Wright, said: “We are very pleased that our ongoing commitment to safe and sustainable mining has resulted in BMA awarding us a four-year extension at Caval Ridge.

“Both our working relationship and the increasing diversity within our workforce are driving factors for our continued success.”

Thiess Group Executive Australia East, Rae O’Brien, added: “Thiess continues to support the development and long-term economic value to the local community at Caval Ridge by providing local employment and regional supply opportunities.”

NACG’s MacKellar Group banks five-year met coal contract in Queensland

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North American Construction Group Ltd says the MacKellar Group has been awarded a five-year contract extension by a major metallurgical coal producer in relation to a mine in Queensland, Australia.

The contract contemplates the provision of fully maintained equipment and related services at the site operated by the producer.

The award extends the expiry date from June 6, 2025, to June 30, 2030, and qualifies as contractual backlog given minimum hour commitments in the agreement, NACG says. Rental scopes are estimated at C$100 million ($74 million) per year resulting in a total value from this extension of C$500 million, the company added.

The contract requires the addition of two loading units and one service truck, for between C$20 and C$25 million, which will be purchased by the end of the year and bring the total dedicated fleet at this site to approximately 70 heavy equipment units.

NACG acquired MacKellar in July 2023 for C$395 million.

Joe Lambert, President and CEO of NACG, said: “We are excited about this extension and look forward to continuing the relationship we have with our customer at this site. This is the first material contract we have signed in Australia since the acquisition of MacKellar and are very proud of how well the first five months have gone.

“MacKellar has provided an excellent platform to grow our business in Australia as we leverage our operational and maintenance expertise in the region. We believe this ‘locking in’ of fleet is indicative of the strong demand for heavy equipment in the Australian mining sector. In light of this demand, and bolstered by long-term contracts, we have begun to take steps towards prudently increasing fleet size in Australia, including potentially transferring underutilised Canadian fleet into that market with the goal of maximising overall utilisation.”

BHP Mitsubishi Alliance secures half of Central Queensland power requirements with renewables

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BHP Mitsubishi Alliance (BMA) has entered into a new renewable power purchase agreement (PPA) with Queensland’s publicly-owned energy generator and retailer CleanCo, which, the company says, is expected to provide half the forecasted electricity demand of BMA’s Central Queensland operations over five years from January 2026.

The new PPA will run to the end of 2030 and effectively extend an existing low carbon emission power agreement between BMA and CleanCo currently running to the end of 2025.

This second PPA will enable BMA to continue to source half of its expected electricity needs from low greenhouse gas emission sources such as solar and wind, as well as pumped hydro.

BHP President Australia, Geraldine Slattery, said: “We are increasing renewable electricity at BMA in line with our decarbonisation commitments to 2030 and beyond, improving the long-term sustainability of our business while at the same time supporting Queensland’s renewable electricity infrastructure build, regional communities and local jobs.

“We expect demand for Queensland’s higher-quality metallurgical coal to remain strong for many years to come, as major steelmakers look to reduce their emissions intensity while delivering the steel needed to support global population growth and decarbonisation infrastructure.”

BHP Chief Commercial Officer, Vandita Pant, said: “Using more renewable electricity at our operated assets across the globe is key to our operational decarbonisation strategy. We are pleased to continue our strong relationship with CleanCo.

“Through a growing number of agreements to supply our mines in Chile, Queensland, Western Australia and South Australia with renewable electricity, we are making good progress on decarbonisation while supporting the development of renewable infrastructure and stimulating regional economies.”

The new PPA will help support four renewable electricity projects across regional Queensland, which combined are expected to generate more than 1,500 local jobs during construction: the Dulacca Wind Farm due for completion in late 2023, the MacIntyre Wind Farm due for completion in 2025, and the Western Downs Green Power Hub and Kaban Wind Farm that currently supply electricity to the grid and are expected to reach full commercial operation later this year.

The PPA is also linked to CleanCo’s new renewable energy storage initiative, which directs excess renewables to the Wivenhoe Pumped Storage Hydroelectric Power Station to support an increase in around-the-clock renewable supply and cost management.

CleanCo CEO, Tom Metcalfe, said: “At CleanCo we are committed to providing tailored, clean energy solutions to help our customers decarbonise.

“It is our role to develop solutions that meet the unique energy needs of these companies so that they can thrive in a net zero future and I am thrilled BMA has entrusted CleanCo to continue to supply reliable, renewable energy for its operations.”

BHP is on track to achieve its medium-term target to reduce operational greenhouse gas emissions by at least 30% by FY2030 (from FY2020 levels). BHP also has a long-term goal to achieve net zero operational greenhouse gas emissions by 2050.

Orcoda’s OWLS software platform to be used at Kestrel’s coal operation

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Orcoda Limited says its wholly-owned subsidiary Orcoda Resource Logistics has signed a software as a service (SaaS) contract with Kestrel Coal Pty Ltd.

Kestrel is one of the world’s largest producing underground metallurgical coal mines that produces around 7 Mt/y of metallurgical coal from its mine in the Bowen Basin of Queensland, Australia.

The Orcoda Workforce Logistics System (OWLS) provides a tailored solution to manage and oversee the workforce accommodation of Kestrel Coal’s 700-strong employees and contractors on site to enhance automation, efficiency and compliance, according to Orcoda.

The SaaS contract is for an initial term of three years and the expected revenue is made up of an initial implementation fee plus a monthly licence fee with a contract value of A$255,000 ($177,384), which could increase if Kestrel Coal later adopts additional features from the OWLS platform.

Geoff Jamieson, Orcoda Managing Director, said: “We are delighted to offer a solution to Kestrel Coal for managing and optimising their workforce accommodation on site. Our OWLS platform was specifically developed to manage mobile workforces in people-intensive industries that involve significant remote workforce management procedures, which are manually intensive at present. This means there is often limited visibility in the onboarding-to-roster cycle and between different teams within an organisation. Orcoda believes our software and contracting expertise will deliver significant benefits to Kestrel Coal and other similar companies in the natural resources/infrastructure industries.”

Thiess to continue providing mining solutions to BMA’s Caval Ridge mine

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Thiess says its mining services contract with BHP Mitsubishi Alliance (BMA) for the Caval Ridge operations in Queensland, Australia, has been extended for potentially another five years.

The contract, which starts on December 1, 2022, for a potential term of up to five years, has revenue to Thiess valued up to A$600 million ($389 million), it said.

Under this contract, Thiess will continue to provide mining services at the Caval Ridge mine, operating and maintaining mining equipment to move overburden to support BMA’s production requirements.

Thiess Executive Chair and CEO, Michael Wright, said: “Thiess has been providing mining solutions to BMA at Caval Ridge since December 2017. Importantly, our team continues to have a clear commitment and focus on fostering diversity and respectful workplaces, with almost 30% of the workforce being female and 10% being Indigenous.

“We continue to seek opportunities to bring under-represented groups into the mining industry, and delivering sustainable mining solutions for our clients and stakeholders.”

Thiess Executive General Manager Australia East, Cluny Randell, said: “We’re very proud to build on our safe and strong performance at Caval Ridge, and extend our deep working relationship with BMA. We will continue to drive long-term economic value by creating local jobs and regional supply opportunities, and supporting the communities where we operate.”

Caval Ridge is one of nine metallurgical coal mines in Queensland’s Bowen Basin. It is a part of BMA, the 50:50 joint venture between BHP and Mitsubishi Development.

Teck to trial carbon capture utilisation and storage tech at Trail Operations

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Teck Resources has announced a Carbon Capture Utilisation and Storage (CCUS) pilot project at its Trail Operations metallurgical complex in southern British Columbia, Canada, in support of its Net-Zero Climate Change Strategy.

The CCUS pilot is expected to begin operation in the second half of 2023 and is expected to contribute to the company’s aim of reducing the carbon intensity of its operations by 33% by 2030 and achieve net-zero emissions by 2050.

“This carbon capture pilot is an important step towards our knowledge building for the application of carbon capture, utilisation and storage as an emissions reduction solution, as we work to evaluate pathways to reduce greenhouse gas emissions across our operations and achieve our net-zero goal,” Don Lindsay, President and CEO, said. “The pilot also provides us with a technical platform to assist our steelmaking coal customers in materially reducing the carbon intensity of their steel production.”

The pilot plant will capture carbon dioxide (CO2) from the acid plant flue gas at Trail Operations at a rate of 3 t/d. The pilot project will also evaluate options for the utilisation and/or storage of the captured CO2 at Trail Operations, Teck says.

If successful, the project could be scaled up to an industrial CCUS plant with the potential to capture over 100,000 t/y of CO2 at Trail Operations, the equivalent emissions of more than 20,000 cars.

Teck acknowledged the support of the CleanBC Industry Fund for its funding contribution towards the CCUS Pilot Plant Feasibility Study, which was an important step in advancing the pilot. The CleanBC Industry Fund highlights the alignment between industry and government in achieving Canada’s goal of net-zero emissions by 2050, it said.

Second Superior highwall miner set for Bens Creek met coal mine

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Bens Creek Group plc, the owner of a recently re-opened metallurgical coal mine in North America, has announced that Ben’s Creek Operations WV LLC, a wholly owned subsidiary of the group, has entered into a contract to purchase a Superior highwall miner and related highwall mining equipment for use at the Bens Creek mine.

The company plans to deploy the new highwall miner in the June quarter of 2022.

The highwall miner and associated equipment is anticipated to be delivered next month and complements the successful implementation of the first highwall miner operated by Mega Highwall Mining LLC (MHW) pursuant to the contract mining services agreement with MHW, Bens Creek said. The MWH contract allows for a minimum production capability of 40,000 tons (36,287 t) of coal per month, which equates to 480,000 tons/y. 

The capacity of the Superior Highwall Miner, a company owned by Terex Corp, being acquired is broadly in line with the highwall miner operated by MHW.

The purchase price of the second highwall miner and related equipment is $2.5 million with $100,000 being payable on signing of the agreement and the balance to be paid within 30 days. The purchase price of the highwall miner is being funded from the group’s available cash resources.

Adam Wilson, CEO of Bens Creek, said: “I am delighted we are buying this highwall miner, rather than renting it, as we have been able to negotiate attractive commercial terms. The potential to double our production capability in such a short period of time since the commencement of initial coal production will provide increased operational capacity as we seek to increase levels of production from the Bens Creek mine and in turn gives us the ability to boost revenue generation.”

BHP to sell stakes in Poitrel and South Walker Creek met coal mines to Stanmore

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BHP has signed a Share Sale and Purchase Agreement to divest its 80% interest in BHP Mitsui Coal (BMC), an operated metallurgical coal joint venture in Queensland, Australia, to Stanmore SMC Holdings Pty Ltd.

Stanmore SMC, a wholly owned subsidiary of Stanmore Resources Limited, has agreed to acquire 100% of the shares in Dampier Coal (Queensland) Pty Ltd from BHP Minerals Pty Ltd, the subsidiary which holds BHP’s interest in BMC, for cash consideration of up to $1.35 billion. The purchase price comprises $1.1 billion cash on completion, $100 million in cash six months after completion and the potential for up to $150 million in a price-linked earnout payable in the 2024 calendar year.

The sale is subject to the satisfaction of certain conditions, including customary competition and regulatory approvals. This includes approval from the Foreign Investment Review Board. Completion is expected to occur in the middle of the 2022 calendar year.

The BMC portfolio includes significant infrastructure including an 8.4 Mt/y coal handling and processing plant (CHPP) at South Walker Creek (pictured), the 9 Mt/y Red Mountain CHPP (fully owned by BMC) in close proximity to the Poitrel operations, two rail loops and train loading facilities, two Marion 8050 draglines, and a fleet of excavators, dozers and haul trucks, Stanmore said.

BHP Group Limited operates BMC as part of an 80:20 joint venture with Mitsui.

BHP intends to continue operating BMC until completion and work closely with Stanmore Resources to ensure a successful transition of ownership. It will provide certain transitional services to Stanmore Resources for a short period of time after completion.

BHP’s President Minerals Australia, Edgar Basto, said: “This transaction is consistent with BHP’s strategy, delivers value for our company and shareholders and provides certainty for BMC’s workforce and the local community. As the world decarbonises, BHP is sharpening its focus on producing higher quality metallurgical coal sought after by global steelmakers to help increase efficiency and lower emissions.

“South Walker Creek and Poitrel are well-run assets that have been an important part of our portfolio for many years and we are grateful for their contribution to BHP.

“Under this agreement, BMC will transition to Stanmore Resources, an ASX-listed company that has established relationships with Traditional Owners and strong engagement with their workforce and local communities. Stanmore Resources share our focus on safety performance and culture and support Australia’s commitments under the Paris Agreement.”

Stanmore Resources’ existing assets in Queensland’s Bowen Basin include the Isaac Plains Mine and processing facilities, the adjoining Isaac Plains East and Isaac Downs mining areas and the Isaac Plains Underground Project.

BHP, meanwhile, said the review process for its New South Wales Energy Coal is progressing, in line with the two-year timeframe announced in August 2020.

Ben’s Creek to start up met coal mine with highwall miner and contract mining pact

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Bens Creek Group Plc, the owner of a namesake met coal mine in North America, is pleased to announce that its wholly owned subsidiary, Ben’s Creek Operations LLC, and Mega Highwall Mining LLC have entered into a contract mining services agreement.

MHW will be responsible for the production of BCO’s metallurgical coal reserves for an initial 12-month period, the London-listed company said.

The contract allows for a minimum production capability of 40,000 tons (36,287 t) of coal per month, which equates to 480,000 tons/y. MHW will deploy a single highwall miner (a Superior Highwall Miner, the company confirmed), which is designed to meet the target sales volumes disclosed in the recently signed offtake agreement between the company and Integrity Coal.

MHW and BCO have agreed a fixed price per ton of coal produced for the duration of the contract period. The contract price negotiated is in line with the company’s working capital projections, despite the uptick in demand for contract mining services and high wall mining equipment in the US, it said.

The contract allows MHW to mobilise its equipment and personnel to commence production in December 2021.

MHW, founded in 2015, is a Kentucky-based company, who operate a range of industry leading specialist highwall mining systems, comprising of ADDCAR, Superior Highwall Miners and Caterpillar.

Adam Wilson, CEO of the company, said: “We are delighted to have secured our first highwall miner to meet our expected production target. The agreement with MHW enables us to commission a second highwall miner to enable the company to further expand its metallurgical coal production output.

“The nature of highwall mining is that the recoverability of metallurgical coal via direct mining into the coal seams is considerable, which allows for production to be targeted to seams which have a higher level of recoverability than traditional mining methods.”

Ben’s Creek is set over 10,000 acres (4,047 ha) in the Central Appalachian Basin of the eastern US and located in the southern part of West Virginia and eastern edge of the Commonwealth of Kentucky.

Historically metallurgical coal has been produced from the property. Ben’s Creek has proven recoverable coal reserves of 2.34 million tons (comprising the coal reserves at the Lower Alma and Pond Creek mines) and has coal resources of 17.2 million in-place tons with a potential of a further 30.9 million tons, it says.

Mastermyne to re-start QCoal’s Cook Colliery met coal mine

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Mastermyne Group has been selected by Constellation Mining Pty Ltd, a subsidiary of QCoal Group, to operate its Cook Colliery metallurgical coal mine in Central Queensland, Australia.

The project will be restarted over two distinct phases with the first phase commencing immediately, according to Mastermyne.

The Stage 1 works will see the company re-commence the underground operations including bringing the operation out of care and maintenance and transitioning back into production. Stage 1 works will include re-commissioning of underground infrastructure, overhauling of mining equipment, establishment of production panels and all other associated administrative and procurement works. Stage 1 works are scheduled to commence immediately and be completed by late this calendar year.

The Cook Colliery was previously owned and operated by Bounty Mining, which went into administration after placing the operation in care and maintenance at the end of 2019. QCoal then acquired the asset in 2020.

In parallel to the Stage 1 works, the parties will finalise a Mining Services Contract for the underground operations (Stage 2). The expected contract value will be determined and communicated once negotiations for Stage 2 are complete, Mastermyne said.

Mastermyne, in conjunction with QCoal, has carried out a review of the mine and the previous mining methods used. The new planned mining areas and operational methods chosen have been based on a thorough assessment of the risks and opportunities, it said. The parties are confident that a measured, low risk approach will deliver consistent results over the extended contract term.

The company will provide further information to the market as the contract process progresses.

Mastermyne CEO, Tony Caruso, said: “QCoal is a very experienced and well-regarded mining organisation that is well known for developing high-quality assets utilising both owner-operated, and contractor-operated models. Both organisations have carefully considered the mining conditions and are confidently progressing with this project using the right methodology and under the right contracting model, which will result in a successful project for all parties.

“We are pleased to be commencing the Stage 1 works, and we look forward to building a long-term successful relationship with QCoal as we recommence mining operations at Cook Colliery.”