Tag Archives: thermal coal

Thiess in line for contract extension at Mach Energy’s Mount Pleasant

Coal technology, Mine operation news, Mining equipment, Mining services, , , , , ,

Thiess has been selected as the preferred mining services contractor for the Mount Pleasant thermal coal operation in New South Wales, Australia.

MACH Energy has notified Thiess of its intention to enter into exclusive negotiations to finalise the terms with the view to execute a mining services contract, it said.

Under the contract, Thiess will continue to provide full scope mining services including drill and blast, load and haul, mining and run of mine rehandling services, equipment maintenance and progressive rehabilitation.

Subject to contract finalisation, from April 2022, revenue to Thiess is expected to be around A$925 million ($690 million) over four-and-a-half years.

“Thiess began operating at Mount Pleasant in 2017 as a greenfield mine, applying industry best practice mining development and operations with uncompromising environmental and safety standards,” the company said. “This includes delivering the operation’s first rehabilitation two months before first coal was mined, demonstrating a true commitment to sustainable practices and to the community more broadly.”

Subject to execution, Thiess will continue to draw on local businesses for the provision of goods and services to support the mine and is committed to attracting and retaining a diverse, local workforce.

Anglo set to complete thermal coal exit with Glencore Cerrejón transaction

Mine operation news, Mining finance, Mining mergers and acquisitions, Mining services, , , , , ,

Anglo American looks set to complete its exit from thermal coal, having agreed to sell its 33.3% interest in the Cerrejón joint venture, in Colombia, to Glencore for around $294 million.

Glencore and BHP currently each also hold a 33.3% interest in Cerrejón, with Glencore intending to acquire both Anglo American’s and BHP’s interests for $588 million in total, thereby assuming full ownership of the asset upon completion.

Cerrejón is one of the largest surface mining operations in the world and mines high-quality thermal coal for the export market. It moves 550 Mt/y by 100% truck and shovel equipment, using more than 300 trucks.

Anglo, earlier in the year, agreed to demerge its thermal coal operations in South Africa to a new holding company called Thungela Resources Limited, with the latest agreement on Cerrejón marking the completion of its thermal coal exposure.

Mark Cutifani, Chief Executive of Anglo American, said: “Today’s agreement marks the last stage of our transition from thermal coal operations. During that transition, we have sought to balance the expectations of our wide range of different stakeholders as we have divested our portfolio of thermal coal operations, in each case choosing the exit option most appropriate for the asset and its distinct local and broader circumstances.”

Both transactions are subject to a number of competition authority and other regulatory approvals, with completing expected in the first half of 2022.

Glencore said on the transactions: “Based on our long-term relationship with Cerrejón and knowledge of the asset, we strongly believe that acquiring full ownership is the right decision and the progressive expiry of the current mining concessions by 2034 is in line with our commitment to a responsible managed decline of our coal portfolio. Production volumes are expected to decline materially from 2030.”

Sedgman to operate Mount Pleasant CHP facility for another three years

Coal technology, Mineral processing, Mining services, , , , , , ,

CIMIC Group’s minerals processing company, Sedgman, has been awarded an extended operations and maintenance services contract at the MACH Energy-owned Mount Pleasant coal mine in New South Wales, Australia.

Sedgman will operate and maintain MACH Energy’s 1,500 t/h Mount Pleasant Coal Handling and Preparation facility for an additional three years, with the extension generating revenue of A$120 million ($91 million) to Sedgman, bringing total revenue from the contract to A$200 million.

CIMIC Group Executive Chairman and Chief Executive Officer, Juan Santamaria, said: “Sedgman and the CIMIC Group have a strong history with MACH Energy which we’re pleased to continue. Sedgman’s leadership in minerals processing will ensure maximum resource recovery for our long-term client.”

Sedgman Managing Director, Grant Fraser, said: “This contract is testament to the partnership we have forged with MACH Energy, and the integration of our engineering and operations capability.”

Sedgman completed the construction of this facility and has been operating the plant since 2019.

Canada to launch strategic assessment for new thermal coal projects

Coal technology, Mining policy, Sustainable mining, , , , , , , ,

Canada’s Minister of the Environment and Climate Change, Jonathan Wilkinson, in partnership with Natural Resources Minister, Seamus O’Regan, have announced that Canada will launch a strategic assessment looking into how future new thermal coal mine projects will be assessed under the government’s Impact Assessment Act.

The strategic assessment will include, but not be limited to:

  • Environmental and health impacts of thermal coal mining;
  • Market analysis of projected demand for thermal coal, including economic impacts and impact on jobs in Canada; and
  • The use of thermal coal mining, including its impact on Canada’s international commitments and initiatives.

The United Nations Secretary General has called for no new coal plants by 2020, and Canada has plans to phase out traditional coal-fired power by 2030.

Wilkinson said: “An important pillar of the Government of Canada’s plan to fight climate change is phasing out traditional coal power generation, while ensuring a just and fair transition for workers and communities. With the phase out of coal power, it is important to consider the future of thermal coal mining. This strategic assessment is the tool included in the Impact Assessment Act to do this.”

Draft terms of reference for the strategic assessment of thermal coal mining will be available online for public comments early in 2020, according to the government.

It also said the Coalspur Vista Coal Mine Phase II project, located in Hinton, Alberta, currently undergoing an environmental assessment by the Province of Alberta, will not be designated for federal review under the Impact Assessment Act because it will be covered under the Provincial environmental assessment process, and the issues of Federal jurisdiction will be covered through other regulatory processes.

“If the project proceeds, it will be subject to all applicable federal regulations,” the government said.

AXIS to cut thermal coal, oil sands from insurance & investment portfolio

Coal technology, General, Mining industry recognition, Mining policy, Mining services, Sustainable mining, , , , ,

AXIS Capital has announced a new policy that will see it exit the market for insurance or facultative reinsurance for the construction of new thermal coal plants or mines, or oil sands extraction and pipeline projects.

The global provider of specialty lines insurance and treaty reinsurance said the policy is a component of a broader corporate citizenship program led by AXIS General Counsel, Conrad Brooks, and overseen by AXIS President and CEO, Albert Benchimol, and the Corporate Governance and Nominating Committee of the AXIS Board of Directors.

This policy, which extends to dedicated infrastructure for coal and oil sands projects, will also see the company no longer offer cover to companies that generate 30% or more of their revenues from thermal coal mining, generate 30% or more of their power from thermal coal, or hold more than 20% of their reserves in oil sands.

And, in terms of investments, AXIS said it will not make new investments in companies that generate 30% or more of their revenues from thermal coal mining, that generate 30% or more of their power from thermal coal, or that hold more than 20% of their reserves in oil sands.

The company added: “Renewals will be considered on a case-by-case basis until January 1, 2023. Exceptions to this policy may be considered on a limited basis until January 1, 2025, in countries where sufficient access to alternative energy sources is not available.”

This is part of a wider program that focuses on four key areas: environment, diversity & inclusion, philanthropy and advocacy, AXIS said.

Benchimol explained: “We believe insurers have an important role to play in mitigating climate risk and transitioning to a low-carbon economy. This policy is in line with our broader strategies such as reducing investments in lines that do not align with our long-term approach; investing in growth areas, such as renewable energy insurance where we are a top five global player; and growing our corporate citizenship program, a core focus of which is creating a positive environmental impact.”

Brooks added: “We strive to ensure that every business decision we make is guided by our corporate values, and we believe this new thermal coal and oil sands policy is the right thing to do for our planet and our business.”

AXIS joins several other insurance companies to make plans to exit or reduce their exposure to thermal coal including Zurich, Chubb, Suncorp, Generali, Munich Re and Vienna Insurance Group.

International Mining is currently putting together its first feature on Mining Insurance, which will be published in the November issue

Peabody and Arch Coal to merge Powder River Basin and Colorado assets

Coal technology, Energy minerals, Mine operation news, Mining mergers and acquisitions, Sustainable mining, , , , , , , , , , , , ,

Peabody and Arch Coal announced that they have entered into a definitive agreement to combine the companies’ Powder River Basin and Colorado assets, in the US, in what they call “a highly synergistic joint venture” aimed at strengthening the competitiveness of coal against natural gas and renewables.

The joint venture is expected to unlock synergies with a pre-tax net present value of approximately $820 million, according to the companies, with average joint venture synergies projected to be approximately $120 million/y over the initial 10 years. The joint venture will be 66.5% owned by Peabody and 33.5% owned by Arch.

Among other assets, the joint venture will combine two productive and adjacent US coal mines – Peabody’s North Antelope Rochelle mine (NARM) and Arch’s Black Thunder mine, which share a property line of more than 11 km – into a single, lower-cost complex.

Peabody says it has the lowest-cost position among major Powder River Basin producers, while Arch has some of the highest-quality coal in the PRB. Arch is contributing its low-cost, higher-margin West Elk Mine that enhances Peabody’s Twentymile mine in Colorado. Further PRB synergies are expected from the integration of the Caballo, Rawhide and Coal Creek mines, which have some of the best overburden-to-coal ratios in the world, the companies claim.

Together with NARM and Black Thunder, these PRB assets represent five of the 10 most productive mines in the US, they said. The inclusion of the Colorado assets will lead to additional synergies and offer the ability to better serve domestic customers while preserving seaborne coal optionality.

In 2018, on a combined basis, the assets shipped 206 million tons (187 Mt) of coal. The assets are operated by a workforce of approximately 3,300, with combined proven and probable reserves totalling 3.4 billion tons (3,084 Mt) as of December 31, 2018.

Peabody President and Chief Executive Officer, Glenn Kellow, said: “The Peabody/Arch joint venture is an extraordinary example of industrial logic targeted to strengthen the competitive position of our products and create significant value for multiple stakeholders in a low-cost combination with exceptional physical synergies.

“The transaction unites two strong, culturally aligned workforces with a commitment to core values such as safety and sustainability. We believe this joint venture allows us to offer enhanced products and security of supply for customers, increased value for shareholders, greater efficiencies for railroads, long-term opportunities for employees and strength for the communities in which we operate.”

Arch Chief Executive Officer, John W Eaves, said: “We are excited about this transaction’s potential to enhance the value of Arch’s top-tier thermal coal assets. This new joint venture should allow us to realise the full potential of our valuable assets in the Powder River Basin and Colorado and benefit our customers in the process. The significant operating synergies will enhance the competitiveness of these assets, and also enable us to continue to generate long-term, sustainable returns for our shareholders. We look forward to completing this transaction in a timely manner.”

Governance of the joint venture will consist of a five-member board of managers appointed by Peabody and Arch. Each party will have voting rights in proportion to its ownership percentage, with certain items requiring supermajority approval. As the operator, Peabody will manage all activities including the marketing of coal. Peabody and Arch will share profits, capital requirements and cash distributions of the joint venture in proportion to ownership percentages.

Aggregated synergies are expected to enable the joint venture to significantly reduce costs well beyond what each company could achieve alone, the companies said, adding: “A lower cost structure enables coal to better compete against other energy sources for electricity generation and create value.”

Expected substantial synergies include, among others:

  • Optimisation of mine planning, sequencing and accessing otherwise isolated reserves;
  • Improved efficiencies in deployment of the combined equipment fleet;
  • More efficient procurement and warehousing;
  • Enhanced blending capabilities to more closely meet customer requirements;
  • Improved use of the combined rail loadout system and other rail efficiencies;
  • Reductions in long-term capital requirements, and;
  • Leveraging Peabody’s shared services.

Kellow said: “For Peabody, the creation of the joint venture is a clear demonstration of the company’s US thermal strategy to optimise our lowest-cost, highest-margin operations in a low-capital fashion to maximise cash generation.

“The transaction fully aligns with our stated investment filters, further enhances our financial strength and enables continued commitment to our shareholder return program, in which we are committed to returning an amount greater than our free cash flows to shareholders in 2019.”

Peabody and Arch will continue to operate the assets independently until closing of the transaction. Closing is subject to regulatory approval and satisfaction of usual closing conditions.

Multotec’s SX10 low density spiral opens up coal separation options

Coal technology, Mineral processing, Mining equipment, Mining services, Steel and iron ore, , , , , , , ,

Multotec Gravity Division says its new SX10 low density spiral further extends the benefits this innovation offers in fine coal beneficiation, with the technology able to produce both thermal and coking coal on one spiral.

The Multotec SX10 low density spiral’s reduced cut point of 1.55 g/cm3 delivers considerable advantages over the cut points of between 1.6 and 1.8 g/cm3 typically achieved in the coal industry today, according to Multotec Technology Manager, Faan Bornman.

The result, he says, is cleaner coal with less waste being achieved in a single stage. This helps achieve savings on capital costs as no further spiral stages are required for cleaning down the line.

“The approach taken with the Multotec SX10 spiral is to remove the gangue, or mineral containing particles, from the trough in two off-takes,” Multotec said.

The first off-take removes ash, opening up the available separation surface of the spiral and allowing the remaining material to separate more easily. This separates clean coal from less-clean coal.

“The low density spiral is essentially a primary and secondary stage on one centre column,” Bornman said. “Rejects are discarded into the centre column and the remaining product is re-pulped before being sent to a secondary off-take.”

Facilitating the two off-takes is a longer spiral on the Multotec SX10. This increases the residence time and gives the particles sufficient time to separate, according to the company.

Depending on the setting of the product box splitters, this new spiral has the ability to produce both thermal coal and coking coal on one spiral, Multotec claimed. Bornman said this was proven through test work done in the US where the two offtakes enable the removal of most of the gangue leaving a middlings and cleaner coal products to be collected at the dart splitters.

Experimental work was carried out using coal from two South Africa collieries as well as doing site test work in the US. Promising results were obtained leading to the first order for Multotec SX10 spirals from a North America-based mine, it said.

Adani Mining finds funds for Carmichael thermal coal project in Queensland

Coal technology, Energy minerals, Mineral project development, Mining finance, Power supply for mines, , , , , ,

Adani Mining has managed to get together the financing needed to develop its massive Carmichael coal mine and rail project in Queensland, Australia, after parent company, the Adani Group, said 100% of the funds would come through its own resources.

The announcement follows recent changes to simplify construction and reduce the initial capital requirements for Carmichael, which is expected to produce some 27.5 Mt/y of high-quality thermal coal once fully ramped up.

Adani Mining CEO Lucas Dow said construction and operation of the mine will now begin.

“Our work in recent months has culminated in Adani Group’s approval of the revised project plan that de-risks the initial stage of the Carmichael mine and rail project by adopting a narrow-gauge rail solution combined with a reduced ramp up volume for the mine,” Dow said.

“This means we’ve minimised our execution risk and initial capital outlay. The sharpening of the mine plan has kept operating costs to a minimum and ensures the project remains within the first quartile of the global cost curve. All coal produced in the initial ramp up phase will be consumed by the Adani Group’s captive requirements.

“We will now begin developing a smaller open-cut mine comparable to many other Queensland coal mines and will ramp up production over time to 27.5 Mt/y,” he said.

The construction for the shorter narrow-gauge rail line will also begin to match the production schedule, he added.

The company has already invested $3.3 billion in Adani’s Australian businesses, according to Dow. “[This] is a clear demonstration of our capacity to deliver a financing solution for the revised scope of the mine and rail project.

Carmichael is expected to deliver more than 1,500 direct jobs on the mine and rail projects during the initial ramp-up and construction phase, and will support thousands more indirect jobs, all of which will benefit regional Queensland communities, Adani said.

Preparatory works at the mine site are imminent and Adani Mining is working with regulators to finalise the remaining required management plans, ahead of coal production, some of which have been subject to two years of state and federal government review.

“This process is expected to be complete and provided by the governments in the next few weeks,” Adani said.

Today’s announcement follows eight years of planning, securing approvals and successfully contesting legal challenges from anti-mining activists, according to Dow.

“We have worked tirelessly to clear the required hurdles,” he said. “Given we meet the same environmental standards and operate under the same regulations as other miners, we expect that Adani Mining will be treated no differently than any other Queensland mining company.”

Located more than 300 km west of the Queensland coast, the Carmichael thermal coal mine and rail project will transport coal from the Galilee Basin to countries in Asia, including India, Vietnam and China.

In addition to the number of jobs and tax revenues Carmichael will create, the mine will also open the north Galilee Basin for further development, according to Tania Constable, Chief Executive Officer of the Minerals Council of Australia.

“[This is] an exciting new phase in Australia’s rich history of mining exploration and development, which has made our nation a global mining powerhouse,” she said.