Stanmore shuts down Mavis Underground coal mine in Bowen Basin, calling it ‘uneconomic’

Despite closing the Mavis Underground mine Stanmore have left the future of development at the complex open ended while potentially reallocating its workers to other projects. READ THE LATEST.

Stanmore Coal's Isaac Plains mine is still running successfully.

Following the closure of the Mavis Underground project at the Millenium mining complex, Stanmore have said they will work with their contractor to facilitate discussions regarding reallocation of workers.

A Stanmore spokesperson said that the difficult decision to close the mine came after a strategic review found the project to be uneconomic.

“Mavis Underground was always anticipated to be a small and opportunistic short-life project,” they said.

“The challenge in achieving ramp-up volumes resulted in higher unit costs.”

Stanmore has been working with the Mackay based Mavis Underground mining services contractor PIMS to manage the reallocation of workers to other operations.

“Given the small volume of remaining recoverable reserves in the small Mavis Underground E pit, it is unlikely that reopening the pit in future would be economically viable.”

Stanmore have left the future of the Millenium Underground development project open ended, saying that it will be unaffected by the decision to close Mavis, but that it will be subject to to Stanmore’s capital allocation and prioritisation strategy.

The former regional mayor and new ALP candidate for Burdekin has been shocked by Stanmore’s decision to shut Mavis Underground mine after less than four years of ownership echoing the sentiments of the Mining and Energy Union who raised concerns to Resources Minister Scott Stewart.

“I’m bemused that it’s a hard closure and not a care and maintenance model implemented or a non sell model,” Mrs Baker said.

“I would be quite interested to understand the thinking behind a hard close.”

Known for her work on the ‘Save Glenden’ campaign, Mrs Baker is running for the seat of Burdekin as the Labor candidate. Picture:Michaela Harlow

While its unclear how many workers will be losing their jobs as a result of the closure, Mrs Baker does not believe there will be a dramatic knock-on effect felt within the nearby community of Moranbah.

“Whenever jobs are lost, there will always be a degree of impact to the existing communities, but we have quite a blended workforce arrangement these days with drive in, bus, fly and permanent residents,” she said.

“To be able to predict what that impact would be is quite a challenge.”

The Bowen Basin mine is part of the company’s Millenium Complex, and is operated alongside mining services contractor PIMS.

In a statement to the ASX, Stanmore said with the closure and sealing of the Mavis underground pit, the complex as a whole will be in care and maintenance by the end of the third quarter of 2024.

In its telling, the mine was more expensive to operate than it expected, and production volumes were not up to scratch.

The mine was previously operated by Peabody before it was acquired by Stanmore and converted into an underground operation — which did not prove successful.

Affected workers said they were ‘shocked’ by decision when it was handed down in late June.

The MEU criticised the decision to close it up.

“Our view is that there is no reason for Stanmore to seal the mine,” an MEU spokesperson wrote.

“If they don’t want the asset, then they should step aside for someone else who may want to take over.

“We just don’t see any reason for Stanmore to seal the mine and walk away.”

Stanmore insists the proposed extension for the project — Mavis Underground South — is unaffected by the decision to close and seal the mine.

“The potential Millennium underground development option is unaffected by this decision, although, as with any capital project, will be subject to our capital allocation and prioritisation strategy and to the same internal investment criteria as the various other capital project options within the Stanmore portfolio,” a company spokesman said.

“Notwithstanding this decision, we do not expect consolidated Guidance metrics provided in our market announcements on February 26, 2024 be impacted, as our core operations at South Walker Creek, Poitrel and the Isaac Plains complex are expected to continue to perform strongly this year.”

A Department of Resources spokesperson said it is aware underground operations at Mavis Downs ceased on June 27.

“Decisions relating to the operations of a mine are a commercial matter, however the holders are required to operate in accordance with their current development plan,” he said.

“The department will work with Stanmore to ensure that any decision relating to closure of the mine will be in the best interests of the state.”