Australian coal producer TerraCom (ASX: TER) has prolonged the lifetime of its Blair Athol coal mine in Queensland’s Bowen Basin by about 10 years, following a reserves replace.
As of June 30, 2021, the mine’s marketable reserves totaled 19.5 million tonnes, TerraComm mentioned. Primarily based on a gross sales profile of two million tonnes per yr, the corporate estimates that Blair Athol will run for an additional decade, giving the mine 14 years of operation beneath its possession.
TerraCom acquired Blair Athol in 2016 from Rio Tinto for only A$1 (about 72 US cents at as we speak’s charges), at a time when coal costs have been hitting historic lows and high miners determined to dump their coal property. The corporate reopened the mine the next yr.
Blair Athol’s life extension comes amid hovering thermal coal costs and record-low asset values, which is creating a fancy scenario for Australian coal producers.
It additionally follows latest bulletins by the biggest banks in Australia, the world’s greatest coal exporter, committing to section out publicity to thermal coal by 2030.
Some producers, together with BHP (NYSE: BHP; LSE: BHP; ASX: BHP), are mulling their exit from the market. Others similar to China’s Yancoal, Australia’s high unbiased exporter of thermal coal, have chosen to maintain manufacturing charges and give attention to coal high quality.
TerraCom has opted for extending the mine life by low-cost planning and productiveness enhancements.
Blair Athol generates 3 million tonnes of high-quality thermal coal a yr for export into Asian markets.