Coalfields neighbours in sharing deal

Bowen Coking Coal has arranged to potentially fast track exports from its Burton and Broadmeadow East coal projects by working with mining neighbour Fitzroy Australia Resources. The companies have entered into an infrastructure sharing and cooperation term sheet that opens the way for Bowen to start coal exports while still recommissioning facilities at the mothballed Burton mining complex. It comes after Bowen Coking Coal last month announced the pending acquisition of New Hope Coal’s 90 per cent interest in the New Lenton Joint Venture, which owns the Burton mine and New Lenton project in the northern Bowen Basin. It is targeting initial production from the Burton complex, including Broadmeadow East, within six months - subject toapprovals. Bowen has agreed to provide Fitzroy with access to surplus capacity of the haul road, accommodation camp, surfaceinfrastructure and water supply at Burton mine for its future development projects. In return, Fitzroy will transfer 1 million tonnes of its Dalrymple Bay Coal Terminal access to Bowen on a permanent basis, provide Bowen with short-term access to its port and rail capacity, as well as use of its Carborough Downs CHPP to process up to a million tonnes. Fitzroy has also agreed in principle to grant Bowen access to surface infrastructure including the office and laydown area at its Broadlea mine, which sits adjacent to Bowen's Broadmeadow East porject. This will significantly reduce the need for infrastructure related capital expenditure at Broadmeadow East. Additionally, Fitzroy has agreed in principle to allow Bowen to extend the Broadmeadow East project into a small part in the northern area of the contiguous exploration permit (EPC667), and allow for the mining lease ML70257 to be extended over that area in exchange for an agreed royalty payment. Fitzroy will be permitted to mine underground below the Mallawa Haul Road from its adjacent Ironbark No 1 Mine,under a matching/similar royalty structure. The deal will also see Fitzroy able to use Burton infrastructure including the workshop, office, communications and power infrastructure. Bowen Coking Coal executive chairman Nick Jorss said the agreement with Fitzroy was a great outcome. “While we set about recommissioning the CHPP, train load out facility, and haul road at the Burton Mine, the upside for Bowen is that we can connect our high‐quality coking coal from Broadmeadow East, Burton and Isaac Riverto strengthening global markets ahead of schedule without any large upfront expenditure," he said. "Following on from our proposed Lenton JV acquisition, this deal accelerates our strategy to create the nextindependent coking coal producer in the Bowen Basin. "We are working hard to supply global steel markets with our high‐quality coking coal as quickly as possible, noting steel prices are at record levels and coking coal prices are very attractive at present. "This is a win‐win outcome as it unlocks considerable value for both parties in otherwise underutilised infrastructure." The proposed agreement will be subject to Bowen completing the Burton mine and Lenton project acquisition from New Hope Corporation, approval from the New Lenton Joint Venture and various other stakeholder consents.

Coalfields neighbours in sharing deal

Industry Queensland

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