Moranbah mine gets a new life

Posted September 25, 2015

Move hailed by local industry as a positive signal for the coal sector.

Stanmore Coal has issued a tender for contract mining and processing plant operations at its newly acquired Isaac Plains Mine, 7km east of Moranbah.

The company plans to restart the mothballed site in the first half of 2016 after purchasing it from Vale and Sumitomo Corporation for a peppercorn payment of $1.

Key to Stanmore’s interest in Isaac Plains was the company’s acquisition in July of the neighbouring Wotonga deposit, with the potential to run the operations in tandem at reduced costs.

Chief financial officer Andrew Roach said in late August the tender process still had some way to go, with one principal contractor to be selected for mining, CHPP operations and all statutory positions.

Further supply opportunities would be largely dependent on the appointed contractor, he said

Resource Industry Network chairman Tony Caruso said the purchase and planned restart of Isaac Plains mine was a positive signal for the coal sector.

“For each of these operations that get back up and running there is a significant multiplier effect across the regions that support those mines as well – it’s not just about the jobs that get created at the mine site, it is four times that in the supply chain to keep them operating,” he said.

Stanmore Coal managing director Nick Jorss described the acquisition of Isaac Plains as a transformational step for Stanmore.

“Isaac Plains provides us with all of the necessary infrastructure and sufficient minable coal to commence mining in 2016, while the neighbouring Wotonga deposit is anticipated to provide us with a significant mine life extension at a materially lower cost of production,” he said.

Mr Jorss said the transaction represented the culmination of nine months of comprehensive due diligence and negotiations by the Stanmore team.

“We have carefully assessed over 40 growth opportunities in coal over the past two years before selecting Isaac Plains and Wotonga as the right fit for our strategy and risk appetite,” he said.

Taurus Mining Finance Fund came on board as a financing partner for the Isaac Plains acquisition, which includes a Bucyrus 1370W dragline, a 500-tonnes-per-hour coal handling and preparation plant, rail loop, loading facility and mine infrastructure area.

It also brings a number of contractual commitments for Stanmore and the $32 million rehabilitation obligation associated with the mine.

Placed under care and maintenance in September 2014, Isaac Plains produced about 2.8Mtpa of export coal at its peak.

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