Stanmore swoops on Eagle Downs coal project

Stanmore Resources is further increasing its Bowen Basin footprint with a deal to take South32's 50 per cent share of the shovel-ready Eagle Downs metallurgical coal project. It also has talks underway with co-owner Aquila to acquire a further 30 per cent interest in that project and an 80 per cent interest in the neighbouring Eagle Downs South tenement. Stanmore describes Eagle Downs as being ready for immediate construction, with two underground access drifts partially completed before the site went into care and maintenance in late 2015. "The acquisition of Eagle Downs is consistent with Stanmore’s ambition to expand its footprint in Queensland’s premium metallurgical coal basin," Stanmore chief executive officer and executive director Marcelo Matos said. "Eagle Downs is a high-quality project underpinned by a substantial resource base, which provides an exciting development opportunity that is complementary to our broader portfolio and in close proximity to our existing operations. "We believe we can bring our strong technical capabilities, as well as unique infrastructure and logistics portfolio, which will enable Stanmore to unlock the full value potential of Eagle Downs and provide a capital-efficient pathway for any future development decision.” The company will pay South32 $US15 million (about $AU23 million) upfront for its 50 per cent stake in the joint venture project and $US20 million (about $AU30 million) upon the first 100,000 tonnes of coal being mined from longwall mining methods. The consideration also includes future royalty payments linked to coal price thresholds. Completion of the transaction is expected by the end of 2Q 2024, following the satisfaction of conditions precedent. Related: Stanmore takes over MetRes joint venture Eagle Downs boasts a substantial resource base of 1140Mt of resources and 292Mt reserves. Previous studies, including by Aquila, indicated the potential to produce 4-6Mtpa of high-quality, low-volatile hard coking coals via longwall mining Two underground access drifts are approximately 40 per cent complete. Existing site infrastructure also includes water supply and high voltage power systems, sealed roads, office buildings and water and sediment dams. Eagle Downs lies directly south of Stanmore’s Isaac South (EPC755) exploration permit and close to Stanmore’s existing Bowen Basin operations. Related: Stanmore coal resources top four billion tonnes “Stanmore is uniquely positioned to leverage our existing infrastructure portfolio at Poitrel and Isaac Plains to support an optimised development plan for the project, and utilise our existing rail and port capacity as a key investment enabler," Mr Matos said. "Eagle Downs also has strong strategic fit in our portfolio, extending the life of our operationsin the area given the relatively shorter mine life at Poitrel and the Isaac Plains Complex. "This is in line with our commitment to developing options for expanding and increasing the longevity of our business in the area by leveraging our strong existing infrastructure position.”

Stanmore swoops on Eagle Downs coal project

Industry Queensland

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