Anglo American targets put blast mine under pressure

Months before a methane explosion badly injured five workers, the Grosvenor mine was under pressure to increase production.

Anglo American metallurgical coal CEO Tyler Mitchelson arrives at the board of inquiry in Brisbane on Monday. Picture: Glenn Hunt

Months before a methane explosion badly injured five workers, Anglo American’s Grosvenor coalmine was under pressure to dramatically increase production to meet business targets, despite top Australian executives warning of gas safety problems.

Anglo American metallurgical coal chief executive Tyler Mitchelson told the Queensland coalmining board of inquiry — investigating the May 6 blast in central Queensland — that he had “significant concerns” about the management of methane at all of the company’s mines.

He also revealed he had been paid a performance bonus in 2019 despite worker Bradley Hardwick being killed while working at Anglo’s Moranbah North metallurgical coalmine, and the company later being charged over Hardwick’s death.

He said his bonus, which is partly predicated on the company’s “elimination of fatalities” safety strategy, was cut by 10 per cent, and bonuses of senior staff at the Moranbah North mine were cut by 20 per cent, because of the death. “It reflects who has more control … it has to be a recognition that in a tragic event like that, there has to be some implication,” Mr Mitchelson said.

Workers at Grosvenor received escalating production bonuses for making progress mining underground, Mr Mitchelson said, and their bonuses could be slashed for “safety penalties”, which he ­acknowledged created a risk that workers could “under-report” safety issues.

On May 6, five workers were badly burned when methane ignited at the Grosvenor mine, near Moranbah in central Queensland’s Bowen Basin. An ­investigation by The Australian revealed Grosvenor had recorded at least 98 incidents of dangerous methane levels since 2016.

Internal Anglo American documents, uncovered by the inquiry, showed Mr Mitchelson wrote a ­report titled Pathway to Excellence on June 4, 2019, describing his plan to “rapidly” transform the operations into the “most valued met coal business in the world”. But he acknowledged “we are not where we need to be on our safety performance … our safety performance is not moving quickly enough with too many injuries”.

The following month, Grosvenor recorded 10 dangerously high methane incidents. Mr Mitchelson said of the incidents: “We knew this was a trend.”

Globally, Anglo American had “Burning Ambition” targets, Mr Mitchelson said, including doubling its cashflow. Locally, this meant a goal to greatly increase production at Moranbah North and Grosvenor coalmines (the MG complex). In 2019, the production of the MG complex was about 16 million tonnes; Anglo’s target was for the two mines to hike annual production to 24 million tonnes by 2023.

But another internal document — believed to be written early this year, before the explosion — showed Mr Mitchelson regarded the Grosvenor and Moranbah North’s gas management system was not capable of coping with the increased production.

“Production from the MG complex is not currently (statistically) stable, the main areas creating the instability stem from gas, strata and structure issues in ­addition to equipment reliability … The current processes, systems, technology and organisational ­design are not considered ­adequate to support a sustainable (24 million tonnes per annum) complex and as such require a full redesign,” the document reads.

Mr Mitchelson told the inquiry Grosvenor aimed to cut coal production this year, from 135 tonnes a week for the trouble-plagued longwall 103 panel, to 100 tonnes a week for the new longwall panel 104. “We didn’t want the mine to be pushing itself,” he said.

He denied the desire to overhaul gas management at Grosvenor before the explosion was driven purely by a desire to increase production and limit “unscheduled delays”. “Production and safety in all of these pieces of work cannot ever be separated … I cannot run a productive mine without running a safe mine.”