The second half of 2015 was a busy period for Australian coal company, Stanmore Coal, as it completed the acquisition of the shuttered Isaac Plains coal mine and adjacent Isaac Plains East development project and focused on bringing the mine back into production.
In December 2015, the company appointed Golding Contractors as the head contractor at Isaac Plains with a scope of services including overburden removal, coal mining and operation of the coal preparation plant. Meanwhile, the bulk of recommissioning work was undertaken in November and December with the dragline overhaul completed in January under budget.
The company is on schedule for first coal production in April 2016 with mining starting at a target rate of 1.1 million tpy of most metallurgical product coal with some thermal coal byproduct.
Beyond the recommissioning of Isaac Plains, the company also focused on exploration delineation activities at Isaac Plains East. Since October 2015, core drilling, 2D seismic and line-of-oxidation drilling within the target mine area has been underway.
“It is anticipated that the program will enable the company to place a maiden JORD Resource within Isaac Plains East with mining studies to follow,” the company said in its financial report for 2H15. “Long lead items, such as environmental monitoring, relating to the approval process for the project, have also commenced.”
The company anticipates that Isaac Plains East will benefit from its proximity to Isaac Plains mine and the equipment there, including the Bucyrus 1370W dragline, coal handling facility, train load-out and rail spur facilities, as well as administration buildings and workshops.
Unsurprisingly, Isaac Plains took up most of the company’s focus in 2H15 – with the exception of continued exploration at the Clifford project in the Surat Basin undertaken with funding partner, JOGMEC, a state-owned Japanese company tasked with securing the supply of commodities into Japan.
This work resulted in a maiden JORC Reserve of 370 million t with 80 million t indicated resource and 290 inferred resource. Further onsite exploration activities and quality analysis began in 1Q16.
For the half year to 31 December, the company reported an operating loss of AU$6.4 million, reflecting significant due diligence and transaction costs related to the purchase of Isaac Plains. Despite this, the company remains “well funded with significant value enhancing opportunities ahead given the transition to coal producer through the acquisition of Isaac Plains.”