Appendix Iii Competent Person's Report
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THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX III COMPETENT PERSON’S REPORT issues in receiving increased rail and port allocations in a timely manner. However, this scenario could rapidly change with relatively minor increases to the current FOB Port of Newcastle revenues across the coal industry. The proposed Terminal 4 expansion at Newcastle Port is on hold. Even without that project proceeding there are a number of efficiency upgrades underway at PWCS and NCIG that will increase the Port handling capacity over the short to medium term without the need to invest in a major upgrade like T4. In the current climate it is difficult to predict when the next cycle of major rail and port expansion projects will proceed, however expansions of the HVCC are not seen as short to medium term risks to the implementation or timing of any expansion. There always exists some confusion about medium to long term rail and port charges. However, at this point in time RPM considers there are some opportunities for coal miners to seek and obtain better deals across the HVCC. 12.4 QLD Rail Supply Chain The Yarrabee and Middlemount mines are located in Queensland’s Bowen Basin. The mines of the Bowen Basin are connected to the ports by four separate rail networks; Moura, Blackwater, Goonyella and Newlands which collectively are referred to as the Central Queensland Coal Network (CQCN). The total network includes 2,670km of rail track and has a total capacity of approximately 360Mt per annum. Coal from the Yarrabee mine is railed via the Blackwater System to the Port of Gladstone and coal from Middlemount is railed via the Goonyella System to the Port of Hay Point and via the Newlands network to the Port of Abbot Point. The below rail infrastructure of the CQCN is owned and managed by Aurizon Network. Aurizon Network’s operations are governed by 99 year lease arrangements with the State of Queensland. Access to the rail network is managed under a detailed process approved by the competition regulator, the Queensland Competition Authority. The CQCN can be seen in Figure 12-3 There are currently two above rail operators on the CQCN; Aurizon Operations and Pacific National. Middlemount Mine has above rail contracts in place with Pacific National and Yarrabee with Aurizon Operations . This report has been prepared for Yancoal Australia Ltd and must be read in its entirety and subject to the third party disclaimer clauses contained in the body of the report © RPM Advisory Services Pty Ltd 2018 – III-241 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX III COMPETENT PERSON’S REPORT Figure 12.-3 Queensland Rail Networks and Ports 12.5 QLD Port Facilities The Bowen Basin is serviced by five coal terminals across three ports. Between the two Queensland based operations coal is exported via four of the coal terminals: Yarrabee has a contract s with Wiggins Island Coal Terminal and RG Tanna Coal Terminal. Both of the terminals are based at the Port of Gladstone. Middlemount Coal has contracts with Abbot Point Coal Terminal at the Port of Abbot Point and with Dalrymple Bay Coal Terminal at the Port of Hay Point. Abbot Point Coal Terminal The Port of Abbot Point is Australia’s northernmost export facility located approximately 25 km North of Bowen in North Queensland, Australia. The T1 terminal has a nameplate capacity throughput of 50Mtpa. In fiscal Year 2016-2017, 25.4Mt was shipped through Abbott Point The facilities at Abbot Point comprises coal handling and stockpile areas, a rail unloading facility, a single trestle jetty and a conveyor connected to a berth and shiploader 2.75 km offshore. Dalrymple Bay Coal Terminal Dalrymple Bay Coal Terminal (DBCT) is located 38km south of Mackay in the Port of Hay Point. The coal terminal has a nameplate capacity of 85Mtpa. DBCT was established by the Queensland Government in 1983 and in 2001 awarded a 50 year lease plus a 49 year option to DBCT Management Pty Ltd. The facilities at the site include four berths, three ship loaders, train unloading facility and coal stockyards with a live capacity of 2.3Mt. Wiggins Island Coal Export Terminal The Wiggins Island Coal Export Terminal (WICET) is located to the west of the RG Tanna Terminal in the Port of Gladstone. WICET has a current capacity of 27Mtpa and a current throughput of 16Mtpa. The offshore wharf This report has been prepared for Yancoal Australia Ltd and must be read in its entirety and subject to the third party disclaimer clauses contained in the body of the report © RPM Advisory Services Pty Ltd 2018 – III-242 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX III COMPETENT PERSON’S REPORT and loading facilities are situated north of Wiggins Island, adjacent to the Targinie Channel. The rail unloading facilities are located immediately south of the North Coast Line (NCL) and are connected to the Golding Point stockyard via a 5.6km long overland conveyor. The facilities include a train unloader, stockyard with a capacity of 1.85Mt, wharf and shiploader. RG Tanna Coal Terminal RG Tanna Coal Terminal (RGTCT) is located in the Port of Gladstone. The coal terminal has a nameplate capacity of 74Mtpa. The terminal is operated by the Gladstone Ports Corporation which is a Queensland Government owned corporation. The facilities at the site include four berths, three ship loaders, three train unloading stations and coal stockyards with a live capacity of 5.8Mt in up to 22 separate stockpiles. This report has been prepared for Yancoal Australia Ltd and must be read in its entirety and subject to the third party disclaimer clauses contained in the body of the report © RPM Advisory Services Pty Ltd 2018 – III-243 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX III COMPETENT PERSON’S REPORT 13. Site Infrastructure Supporting regional and local infrastructure for the Assets is well established and has ample capacity for the continued support of the planned LOM operation. The Assets are located in close proximity to regional townships and serviced by national highways and good quality tarred roads. The surrounding towns provide suitable accommodation and supporting industries for the operations . Below is a description of the major infrastructure requirements of the Assets (other than rail and port transport infrastructure). RPM’s observations during the various site visits confirm each site has fit for purpose infrastructure in suitable condition to support the estimated project life. 13.1 Transportation Facilities All of the mines are currently operating with the exception of Donaldson which is currently under care and maintenance. As part of the site visits, RPM observed that the installed transport infrastructure including rail loading facilities, site access roads and conveyors were generally in good working condition. Open cut projects will require periodic construction of haul roads and site access roads however this is standard practice for operating mines. RPM make the following specific comments: . MTW - A new heavy vehicle underpass (beneath the Putty road) has recently been completed to allow overburden to be hauled from Warkworth pits to Mt Thorley waste dumps. This is the second heavy vehicle road linking the two mines. Stratford and Duralie - two road diversions are required to achieve the life of mine plan. The roads are not main thoroughfares. The Wenham Cox Road diversion is required to access the Avon North pit which is due to commence in the next 12 months. The Johnsons Creek Road will be required to mine the Duralie East pits from 2024. The SEOC at Ashton will require a new ROM pad and overland conveyor for coal handling. Ashton currently relies on trains using the Ravensworth Operations rail loop which is managed by Glencore to turn trains around after loading at Ashton. The rail loop access agreement expires in 2024 and either a renewal or alternate strategy is required to complete the LOM Plan. 13.2 Buildings and Yards The operations are equipped with the usual complement of facilities including parking areas, gate-houses , offices, warehouses, storage yards, workshops, scrap yards, laboratories, change rooms, lunch rooms, emergency-service facilities (medical clinics and fire-fighting), food-service facilities, etc. required to serve the mines and plants. RPM have not completed a detailed audit of the facilities at each site. Given the majority of the sites are operating mines, RPM anticipate that the existing infrastructure is in place to support mining activities except for the following specific comments: . Ashton LOM plan suggests the requirement of additional workshop due to the isolated location of the SEOC. Capital allowance is included in the LOM Plan for site infrastructure adjacent to the SEOC pit. 13.3 Water Supply and Storage HVO Water supply requirements for HVO differ depending on whether the area is a net user or producer of water during the various rain seasons as outlined in Section 2. The water management system for HVO, including the West Pit, operates through the separation of clean and dirty water via separate water circuits between the tails and CHPP facilities. The main consumption of water is for dust suppression on haul roads, mining areas and coal stockpiles and CHPP circuit losses.