MetRes: First coal struck at Millennium and Mavis Downs mine near Moranbah

In just nine weeks, the new owners of the Millennium mine near Moranbah in Central Queensland have passed a significant milestone. Find out what it means for the project.

Just nine weeks after taking over ownership of a mothballed Central Queensland mine, M Mining has struck first coal.

MetRes, a joint venture between Stanmore Resources and M Resources, acquired the mothballed Millennium and Mavis Down mine near Moranbah from Peabody Energy in July with an aim to ship its first coal in October.

That goal is firming up, with M Mining producing its first high quality metallurgical coal at the weekend from the Mavis Downs Pit at Millennium Mine.

M Mining director and owner Matt Latimore said achieving first coal so quickly was the result of a fantastic effort from the project’s partners, suppliers, managers and workforce.

“Since commencing operations in August with an innovative mine restart plan, this has been an important early production milestone for us,” he said.

“In the nine weeks since completion of the sale of Millennium Mine, M Mining has established a strong operating team and issued A$464 million in contracts for auger, auger support, open cut and underground.

“Our work is underwriting the future growth of this operation, economic activity and local employment opportunities.

“Since announcing the acquisition of Millennium in April we have said that this will be a low capital, fast to market asset, producing high quality coal.”

First coal came the day after a new historic high of US$380/tonne for Australian hard coking coal.

The milestone follows the announcement PIMS Group has been awarded a major five-year, $425 million contract for underground mining services at the Millennium and Mavis Downs coal mines, which will create up to 100 mine construction jobs and more than 125 direct full-time mining jobs for the Central Queensland region.

The contract, which was announced by M Mining, covered underground mining, using the bord-and-pillar method, commencing with Mavis Downs and later transitioning to Millennium. Production would be more than 1.2 million tonnes run of mine each year from July 2022.

PIMS Group would be responsible for the establishment of required infrastructure including conveyor systems, ventilation, associated mine services and surface infrastructure.

The next key milestone for M Mining is open cut mining at Millennium by November 2021.

Promising Blair Athol forecast

Emerging resources company TerraCom Limited has revealed a promising forecast for its Blair Athol operation in the Bowen Basin.

TerraCom purchased the mine near Clermont for just $1 from Rio Tinto in 2016, which required an $80 million rehabilitation bond.

In an ASX announcement on September 9, TerraCom said it was positioned to capitalise on the ‘exceptional seaborne coal pricing’, bolstering operating cash margins for Blair Athol.

“Thermal coal from BA is sold into premium Asian markets, predominantly Japan and Korea, and into the Indian sponge iron market,” the company said.

“Blair Athol is forecast to generate revenue of AU$178 per tonne in September 2021 which will generate an operating cash margin in excess of AU$100 per tonne.

“Both the Newcastle Index and API4 are nearing all-time highs and are at levels which have not been seen since mid-2008, being 12 years ago.

“Based on economic forecasts the indexes are expected to remain solid throughout FY2022 and as a result, the company expects to generate strong operating cash flows from Blair Athol in FY2022.”

In August, Blair Athol sold two cargoes, which it said was in line with forecast.