Auger mining is scheduled to commence in August

Coal venture to start in August: “With a predicted mine life of 22 years including rehabilitation, these are lasting jobs and will create long-term royalties that will benefit all Queenslanders.”

More than 150 new mining jobs will be created in Central Queensland as the Millennium and Mavis Downs coal mines near Moranbah are restarted.

A former mining ‘minnow’ that purchased its first mine in 2015 will soon expand its Bowen Basin operations, with Peabody Energy Australia finalising its sale agreement with MetRes – a 50/50 joint venture between Stanmore Coal and M Resources.

In an ASX announcement Tuesday, the Board of Stanmore Resources Limited confirmed the acquisition was complete and revealed auger mining was scheduled to commence next month, with rail and port logistics contracts executed providing a clear path to delivery allowing the company to take advantage of favourable market conditions.

It was previously revealed the acquisition was for an upfront cash consideration of $1.25 million and royalty agreement (capped at $1.25 million) and as part of the deal, MetRes would assume and undertake rehabilitation obligations estimated at $25.7 million, with Peabody reimbursing $12.5 million of incurred rehabilitation costs over a two-year period.

Coal washing will be undertaken at the Red Mountain Infrastructure coal handling and preparation plant via a fully executed toll washing and train loading agreement.

Resources Minister Scott Stewart said the sale agreement would allow the restart of the Millennium and Mavis Downs coal mines and was great news for Queensland. Millennium is adjacent to Stanmore’s Isaac Downs project and has been in care and maintenance.

“This sale agreement will help with our state’s COVID-19 economic recovery,” Mr Stewart said.

“This venture will create more than 150 jobs through investment in underground expansions and completion of rehabilitation obligations.

“With a predicted mine life of 22 years including rehabilitation, these are lasting jobs and will create long-term royalties that will benefit all Queenslanders.

“This investment is a strong sign of the growing confidence in our resources sector as Queensland continues its road to economic recovery.”

Queensland’s Stanmore Coal purchased its first open cut coal mine off Brazil’s Vale and Japan’s Sumitomo in 2015.

As part of the sale, Stanmore took on a $32 million rehabilitation obligation associated with the mine.

Since then, its portfolio has grown to feature projects in the Bowen and Surat basins.

The Millennium and Mavis Downs mines will feature a mix of open cut, high wall and underground mining methods used for the extraction of high-quality metallurgical coal.

The project will have a total production of 13.9 million tonnes of metallurgical coal during its lifespan.

Mr Stewart said the Palaszczuk Government would continue to support the resources sector for the royalties and jobs it generates, particularly in regional Queensland.

“The resources sector supports more than 84,000 jobs across Queensland and represents $44 billion in exports,” he said.

“The sector has played a vital role in supporting jobs during the pandemic and will continue to do so into the future.

“Queensland is naturally blessed with the world’s highest quality metallurgical coal, which the world needs to make steel.

“Even as the world transitions to renewables, metallurgical coal for steel will remain an essential and valuable international export commodity for Queensland.”