Whitehaven’s $1b Qld coal project edges forward

The proposed $1 billion Winchester South open-cut coal mine has passed what proponent Whitehaven Coal describes as a key approval milestone. Queensland's Coordinator-General has formally accepted the environmental impact statement (EIS) as the final EIS for the Winchester South project, moving ahead with a report evaluating that document. The company said it had refined the project after public feedback to further improve environmental and social outcomes. This includes fully abating Scope 2 emissions through the purchase of carbon neutral electricity, reducing the number of final voids from four to three, and proposing a final land use of agricultural water storage for the three residual voids. The Winchester South project, about 30km south-east of Moranbah, is targeting an average ROM production of 15 Mtpa at full capacity to supply the international market for about 30 years. It is expected to support 500 jobs in construction and 500 when operational. In its quarterly report today, Whitehaven said the project team was also continuing to complete a feasibility study, with detailed studies underway across all work streams. Whitehaven generated $435 million of cash from operations in the past quarter and at the end of June held a net cash position of $2.65 billion. Managing director and chief executive officer Paul Flynn confirmed the company was considering acquisitions, with BHP's Daunia and Blackwater sites on the table. He said said Whitehaven would 'look at all assets that fit in the strategic crossheads of the business', noting that Daunia's proximity to the planned Winchester South mine made it of obvious interest. Metallurgical coal prices declined significantly during the June quarter as steel demand trends were weaker, particularly in China. Whitehaven achieved an average coal price of $264/t for sales of produced coal during the June quarter (excluding volumes supplied through the domestic coal reservation scheme). This was 34 per cent lower than the March 2023 quarter. "We expect coal prices to remain subdued during the Northern Hemisphere summer period while high coal stocks at end user facilities and cheaper alternatives, including gas are available," the company stated in its report to the market. "We maintain our view that increased gas and coal demand for the winter period will mark a turning point in the market where trade flows and the tightness of high CV (calorific value) coal supply will provide support for pricing. "In metallurgical markets, volatility is expected to continue for the balance of CY23 reflecting uncertainty around the strength of economic activity in developed and developing economies."

Whitehaven’s $1b Qld coal project edges forward

Industry Queensland

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