The Australian mining industry has welcomed the government’s allocation of AUS$100 million to Geoscience Australia to undertake pre-competitive geological mapping of mineral deposits as part of its Exploring for the Future programme.
“Exploration geoscience must be central to the nation’s innovation agenda,” said Graham Short, National Policy Advisor at the Australian Association of Mining and Exploration Companies (AMEC).
“Australian has a competitive advantage in resource development and must seize the opportunity for science and innovation, together with vital new capital investment in exploration, to improve discovery rates in Australia.”
“It is pleasing the Turnbull Government has an eye to high-tech jobs of the future in the resources sector by delivering a AUS$100 million exploration programme, Exploring for the Future, which is set to benefit Queensland, by helping to find the next wave of new mines,” Chief Executive of the Queensland Resources Council (QRC) said in a statement.
“Exploration is the R&D, or building blocks, for the resources sector, getting the sector ready for the inevitable future upswing” Roche concluded.
AMEC also called on the government to consider its tole in unlocking resources that are “stranded” sure to a lack of infractructure, approvals delays of access to finance.
“The government’s AUS$50 billion infrastructure development plan to 2019/20 is a great investment for growth and jobs but it mainly focuses on capital cities rather than critical economic producing regional infrastructure, which could release stranded mineral projects and generate revenue streams for the nation, and in regional communities,” concluded Short.
Edited by Jonathan Rowland.
Glencore has reported its 1Q16 production results. The global mining giant indicated that the proactive production cuts announced and actioned in 2015 led to period on period production reductions in copper, zinc, lead, coal and oil, reflecting the company’s disciplined approach to supply at low points in the commodity cycle.
Coal production of 29.7 million t was 5.9 million t (17%) down compared to the previous year, mainly due to the initial part-closure and subsequent placement of Optimum Coal into business rescue in 3Q15, leading to its ultimate sale. In Colombia, some mining restrictions also contributed.
Australian metallurgical coal production was 1.2 million t – 0.3 million t (20%) lower than the comparable period, mainly related to temporary geological issues at Oaky Creek.
Australian thermal and semi-soft coal production was 14.3 million t. The company reported this was in line with the comparable period.
South African thermal coal production totalled 7.3 million t, which was 4.1 million t (36%) lower than the comparable period. Glencore indicated that this reflects the loss of control of Optimum Coal from August 2015 and the closures of Middelkraal and South Witbank, partly offset by increased production at the larger Tweefontein, iMpunzi and Goedgevonden mines.
Prodeco coal production was 4.3 million t – 1.1 million t (20%) lower than the comparable period, reflecting a programme of slowing production in line with a weaker market.
Cerrejón production came in at 2.6 million t, which was 0.4 million t (13%) below the comparable period, reflecting ongoing restrictions, mainly related to the need to limit dust creation as the region continues to endure a multi-year drought.
Edited from press release by Harleigh Hobbs
ASX-listed coal explorer Acacia Coal wound back spending on its exploration and evaluation work to just AUS$6000 in 1Q16 as the company continued efforts to conserve its cash reserves. According to its latest quarterly reports, total expenditure for the quarter totaled AUS$362 000, leaving the company with just AUS$973 000 in cash at the end of the quarter.
The company also said it was exploring alternative opportunities to “deliver more immediate value for shareholders than can be delivered by Comet Ridge alone”.
The Comet Ridge project in the Bowen Basin offers the potential for coal resources amenable to both opencast and thermal mining. It is located in the same region as the operating mines at Ensham, Jellinbah East, Blackwater and Curragh, which produce both thermal and metallurgical coal products. Acacia owns 100% of the project.
“Whilst the company has interrogated a number of opportunities, the board will not execute any related transaction until it considers such an opportunity to provide outstanding value to the company and its shareholders,” the company concluded.
The company has recently relocated its offices from Sydney to Perth and restructured its board and management in order to save cash.
Edited by Jonathan Rowland.
The National Mining Association (NMA), sponsor of MINExpo INTERNATIONAL® 2016, has announced that Caterpillar Inc. Group President Denise Johnson will chair the world’s largest mining equipment exhibition, MINExpo 2016. Johnson, who oversees the Resource Industries group for the Peoria, Ill.-based company, will lead the 2016 show, held 26 – 28 September, at the Las Vegas, Nevada, Convention Center.
“I’m honoured and excited to chair such an expansive showcase of mining equipment, technology and expertise from around the world,” said Johnson. “MINExpo® 2016 is showcasing real technologies, advancements, innovations and solutions that will impact the bottom line of mining companies today – and into the future.”
Johnson joined Caterpillar in 2011 and initially served as the General Manager of Specialty Products within Caterpillar’s Reman & Components Division, where she had global responsibility for wear component products and facilities. She previously had a career with General Motors, where she built deep expertise in operations and product management. In 2012, the Caterpillar Board of Directors named Johnson Vice President with responsibility for Diversified Products Division. Before being named a Group President, Johnson also served as Vice President with responsibility for Integrated Manufacturing Operations and Material Handling & Underground Division.
“As the sponsor of MINExpo®, NMA is excited to bring together the equipment, parts and service providers who are committed to working with mining companies throughout the world to improve safety, lower costs and maximise productivity,” said NMA President and CEO Hal Quinn. “Caterpillar exemplifies that commitment, which is demonstrated in part through its ongoing support of NMA and MINExpo. That said, we are thrilled to have Denise Johnson as our MINExpo 2016 chair.”
Edited from press release by Harleigh Hobbs
Trapper Mining Inc. has welcomed the final approval of its Environmental Assessment (EA) and Finding of No Significant Impact (FONSI) by the US Department of the Interior.
The completed EA, developed by the Office of Surface Mining Reclamation and Enforcement (OSMRE) in response to a lawsuit brought by WildEarth Guardians, allows Trapper to continue operating based on its existing permits for opencast coal mining.
“On behalf of Trapper’s board, employees and families, and our entire community, I want to thank the Department of Interior and the professional team at OSMRE for working together to keep this important effort on track. The approach to the assessment has been thoughtful and thorough and has provided the opportunity for robust public involvement,” said Jim Mattern, Trapper Mining’s President and General Manager.
Trapper’s commitment to environmental stewardship was an essential part of completing the EA. Since the mine opened in 1977, Trapper has been repeatedly recognised for its industry-leading reclamation program, including OSMRE’s Bronze Medal for serving as one of the best three examples of mine reclamation in the US in the modern coal-mining era.
“The Department of Interior’s assessment confirmed that Trapper has no significant impact on air or water quality. And once reclamation is complete, Trapper has virtually no lasting effect on the surface area in and around the mine—and in many cases actually improves the habitat for wildlife,” Mattern said.
The EA process includes two public comment periods, an OSMRE open house and a joint community meeting with the Colowyo mine.
Throughout the entire process, the northwest Colorado community was engaged and showed support for Trapper and its employees. Bipartisan elected officials —including Senators Cory Gardner and Michael Bennet, US Rep. Scott Tipton, Governor John Hickenlooper and state and local leaders — made clear their support to the Department of Interior and Secretary Sally Jewell.
“We greatly appreciate the strong support from federal, state and local elected officials, regional community and business leaders, and community members. Through public comments and vocal support of Trapper, they clearly made their voices heard on behalf of our employees, environmental stewardship and economic impact,” Mattern concluded.
Edited from press release by Harleigh Hobbs
Bharat Heavy Electricals Ltd (BHEL) has commissioned a 600 MW coal-fired thermal power plant in the state of Madhya Pradesh, India.
The unit has been commissioned at the 1 x 600 MW Jhabua thermal power project (TPP) located in Seoni district in Madhya Pradesh. The project is being developed by Jhabua Power Limited (JPL), a subsidiary of Avantha Power & Infrastructure Ltd (APIL).
This is the second project of APIL commissioned by BHEL, which previous earlier commissioned the 1 x 600 MW Avantha Bhandar TPP at Raigarh in Chhattisgarh.
BHEL’s scope of work in the contract envisaged design, engineering, manufacture, supply, erection and commissioning of steam turbine, generator and boiler, along with associated auxiliaries and electricals, besides state-of-the-art controls & instrumentation (C&I) and Electrostatic Precipitators (ESPs).
BHEL-built 600 MW rating sets comprise a 4 cylinder turbine, which is designed in-house. So far, the company has contracted 21 sets of 600 MW each, of which 16 have already been commissioned.
The equipment for the project was supplied by manufacturing units of BHEL located at Trichy, Ranipet, Hyderabad, Bengaluru & Haridwar, while the construction work was carried out by BHEL’s Power Sector – Western Region.
In Madhya Pradesh, BHEL is presently executing two supercritical units of 800 MW for NTPC at Gadarwara. BHEL has contributed towards creating nearly two-thirds of the total power generated in the country, which according to the company indicates its testimony to the superlative performance of its equipment.
Edited from press release by Harleigh Hobbs
Following a meeting between the Board of OKD, New World Resources Plc and New World Resources N.V. (NWR NV, and NWR Plc and NWR NV, together with their subsidiaries, the group) has announced that the board has decided to file an insolvency petition, which has been filed with the Czech court.
As noted previously, including in the announcement dated 29 April 2016, the group has been in discussions with its stakeholders, including the Czech government and the Ad hoc group of its creditors (the AHG), since the beginning of December 2015, regarding a restructuring of liabilities and the provision of vital additional liquidity to OKD. Information provided to the Czech government and the AHG to date shows OKD’s financial position is weak and it urgently requires an external injection of money to be able to continue trading and to meet its financial liabilities, including paying its workers.
As previously announced, the Board of OKD met on 29 April 2016 and decided that, in light of the current circumstances, it would reconvene on 3 May 2016 to discuss the potential filing of an insolvency petition by OKD. No further meaningful progress has been made in the past few days. As a result, the Board of OKD resolved to file an insolvency petition. The insolvency petition was filed on the afternoon of 3 May 2016 with the Czech court.
Edited from press release by Harleigh Hobbs
Essar Power Ltd has resumed the commercial operations of Unit I of the 1200 MW (2×600 MW) Mahan power plant. Essar Power MP Ltd, the operator of the 1200 MW power plant, located in Madhya Pradesh, has secured 3 lakh t of coal through a Government conducted special forward e-auction.
Essar Power MP won a captive coal mine in Tokisud in Jharkhand state in the recent coal auction. Essar has invested over Rs 10 000 crore in the 1200 MW Mahan plant which requires an estimated 5.5 million tpy of domestic coal per year and the Tokisud captive coal mine. The decline in coal prices and captive mines will enable Essar Power to fulfill its commitment to supply affordable power to the nation.
Mr Sushil Maroo, Executive Vice Chairman, Essar Power, said: “We are thankful to the Government for making coal available through e-auctions and aligning coal prices to the current market scenario. It has increased the production and supply of coal, which is a welcome move for the power sector and will help other stranded power projects”
Mr KVB Reddy, CEO-Essar Power Ltd, CEO of Essar Power MP Ltd, added: “We are optimistic that with the availability of coal, the Mahan plant will now run optimally on a sustained basis. We are also confident of commissioning Unit II by September this year.’’
Edited from press release by Angharad Lock
Centaur Holdings Ltd, the global investment holding company, has appointed Wesley Grogor to Group Head of Mining Operations.
Grogor will be based in Dubai and will oversee the resources and mining operations.
Before joining Centaur, he had his own mining services and management business in South Africa with an in-house team of engineers and commercial/technical specialists, which have come across to join Centaur Mining. He has 12 years’ experience in the steel market, related raw materials and shipping. Wesley has previously worked at Macsteel International and shipping and commodity firm FIS.
Wesley’s responsibilities will include co-ordinating the development of all related activities, planning, budget preparation, scheduling, project design, liaisons with regulator and State authorities and to observe, analyse and implement the commissioning and production processes. In addition, he will be building out the existing in-house team along with the outsourced specialists and contractors that Centaur Mining currently work with.
Commenting on the appointment, Centaur Group CEO, Daniel McGowan, said: “We are pleased to welcome Wesley to the Centaur group and look forward to working with Wesley and his in-house team.”
“Our mining interests span global interest and in particular we have a specific focus on developing operating assets and interests in sub Saharan Africa, which Wesley will be part of. His knowledge and experience of South Africa and the coal markets will play an important part in our future growth and success.”
Edited from press release by Harleigh Hobbs
In an exclusive interview with “Akti Miaouli” newspaper, BIMCO Chief Shipping Analyst, Peter Sand, provides insight into the markets for dry bulkers, tankers and containerships in 2016 and what to expect going forward.
The BDI reached the all-time-low level in February. It has since started to rebound. Can this recovery be sustained? What are the prospects of the dry bulk market?
Fortunately the BDI has recovered somewhat from the horrific level of 290 on 10 February 2016. Firstly freight rates went higher for the three smaller segments (ex-capesize) on the back of the start of the strong south American grains season. Then a bit later capesizes have followed suit on the back of China lifting its iron ore and coal demand after a sluggish start of the year.
How to sustain the recovery: keep scrapping volumes up, also when freight rates start to pick up and hit US$10 000/day. Because the fundamental market balance is still very much off. Overcapacity is serious. The current lift in freight rates is not a result of evaporated overcapacity. The prospects for the dry bulk market is one that spells out a multi-year recovery. If we can keep demolition levels high (around 40 m DWT per annum) for the coming three years while not placing any more new orders. We will bring back a sustainable market, even at low demand growth. We all know what needs to be done, but doing it is still a bit difficult.
What is your view on the sustainability of freight rates in 2016? What trades are under the most pressure at the moment in terms of freight rate levels?
BIMCO remains worried about the sustainability of freight rates in 2016. The demand side seems unable to buoy profits as both Chinese and Indian growth cools off and the rest of the world is still importing smaller volumes than before the financial crisis of 2008. However, we have been positively surprised by the way the market has developed during March going into April. Even coal imports into China was strong in March, bringing Q1 imports almost back on par with the 1Q15 level. We have also seen Chinese steel export remain high, in spite of the political headwind in some steel producing nations. Before we get carried away, we also have to admit that the fairly positive trade volumes have failed to bring decisive support to the freight rates.
Considering the surplus capacity and current rates, what are the prospects of the container shipping market?
2016 can prove to become quite challenging for the entire industry. The start has already been terrible: All-time-low rates on most of the trades. Last year, operator benefitted from the falling oil prices, this year, the same positive effect will not be enjoyed. In order to stay profitable, even by a small margin, costs need to be cut yet again. We have seen longer sailing distance being introduced on the backhauls from US and Europe round the Good Hope. More of this can be expected, regardless of the unprecedented discount put in place by the Suez canal recently. Many years of cascading larger and larger ships to secondary trades have made overcapacity not just a problem on the Far East to Europe trade but a global issue. One that will take many years to unwind. In order to turn it around, the individual carriers must manage their capacity to match demand. Fighting price wars and introducing even bigger ships on any trade is not going to bring profits back in itself.
How do you expect Iran’s return to global trade to impact on the tanker market and what should we expect in this segment in 2016?
BIMCO expect Iran’s return to the oil export market to be fairly balanced in the sense that trade lanes may change, but the overall demand situation for tankers is expected not to change. As Iran takes market charge from neighbouring countries doesn’t matter that much. But to the extent that Iran replaces West African exports into Asia, the contribution will be negative. So far, the development has been more or less along the lines, expected by BIMCO – a slow record, one slower than many was hoping for. But what has surprised us a bit is the hesitant approach to undercut prices to gain market shares. In short, Iran may take many headlines – well deserved, but it remains the inflow of crude oil tankers, which will put the freight rates under downward pressure as the year passes.
Are current demolition levels sufficient to bring about market balance in the remainder of the year?
It’s net fleet growth that matters, not just demolition. For dry bulk, the market may actually be in balance this year. But a balanced year, merely means the conditions of 2015 will stick around. That’s not nice to have another year like 2015. What the dry bulk industry needs is multiple years where demand outstrips supply. Only by doing that higher utilisation may be achieved and then better freight rates will also follow. For the container industry, BIMCO expect that the demand side will not keep up with supply growth. Even though the containership fleet has never grown so slowly before. As the GDP-to-trade multiplier for container shipping is 1 at the moment and global GDP, according to IMFs recent downward revision will only grow by 3.2% this year – a supply growth at 3.4% for the containership fleet will bring more misery to the market. Time charter rates and their duration tells the same story.
In terms of the global economy, what do key economic parameters show? Is shipping in for a tough year?
Yes, shipping is in for a tough year. We are candid about that. And we have to be, because it seems as if shortage of insight into the fundamental facts of the supply and demand balance in the past, has prompted owner and investor to become optimistic too early. Placing a lot of orders, which has now extended the eventual recovery once more. The global economy is not providing such a strong support the industry players, which prove extremely price competitive seaborne transportation, which should facilitate trade. The world has simply changed in many ways in the years that have followed in the wake of the big crisis in 2008. The industry needs to reset its cost level and focus fully on adapting to this new normal to stay a part of the future business.
Edited by Harleigh Hobbs. Source: BIMCO
New Columbia Resources Inc. has received notification from the Agencia Nacional de Mineria (ANM) to accept new terms for Contract Application # OG2-10451 for another approved concession contract for high-quality premium metallurgical coal.
On 2 July 2013, New Colombia Resources filed a Form 8K with the Securities and Exchange Commission disclosing that Erasmo Almanza, Director of New Colombia Resources, INC., applied for an additional coal and other grantable minerals concession contract totaling 183.3 ha. (452 Acres) contiguous to their current concession contract # ILE-09551 in Guaduas, Colombia. The new concession contract application number is OG2-10451.
On 15 April 2016, the ANM posted a notice for Almanza to accept new terms for the concession contract within 30 days and adjust the Exploration Program Format A.
Although the original application is for 183 ha., the company believes the area may be reduced since it’s considered a strategic reserve for the country. Blue Gem coal is only found on the KY-TN border and central Colombia and is used to produce specialty metals, such as silicone to make solar panels, electric car batteries and many more next generation products. New Colombia Resources has concession contracts and applications totalling 5000 ha. of high-quality metallurgical coal that will always be needed to produce steel and other specialty metallurgy products.
Metallurgical coal miners in Kentucky have shut down operations due to over-regulation and poor market conditions. This has generated a glut of late model mining equipment being made available to New Colombia Resources. Company President John Campo will travel to Kentucky this week to acquire mining equipment to begin met coal production. He will be meeting with potential investors, customers and partners with state-of-the-art underground mining equipment and experience in extracting metallurgical coal. This equipment can easily be shipped to their property via the Mississippi and Magdalena Rivers.
“I’m sad to see the devastation caused by mine closures in small town America, but I’m happy be able to offer veteran mine operators a mutually beneficial opportunity to continue what they know best while providing a much needed product for solar panel production, which ironically is in the mix to replace thermal coal power plants. One continuous miner can produce 1000 tons per shift, which generates cash flow of at least US$1 500 000/month at today’s depressed prices,” stated John Campo, President of New Colombia Resources.
New Colombia Resources’ Work Permit for underground metallurgical coal mining was approved on December 23, 2013. The company applied for an environmental licence in 2014 but decided to halt the process in order to add building material production to the same licence. Earlier this year the company submitted a Work Plan adding building materials to their approved metallurgical coal Work Permit. The company met with the National Mining Agency at their property last week for a technical visit for the addition of building materials and the Agency verbally gave them comments for clarification of a minor issue. New Colombia Resources will submit the clarification and expects to receive approval in an expedited due course in order to supply material to the massive local road and construction projects. The Work Plan submitted to the Mining Agency estimates revenue of over US$3 million/yr from building materials.
Developed in response to customer input, Martin Engineering® conducted extensive research at its Center for Innovation (CFI) facility in Illinois, US, to find conveyor solutions to carryback, belt health, spillage and pulley/idler health problems faced by numerous industries. The result is a line of cleaning alternatives to standard blades that promote longer belt life with less downtime, leading to a lower cost of operation.

“Conveyor belts react to various substances in vastly different and sometimes unpredictable ways,” said Dan Marshall, Product Engineer at Martin Engineering. “Inadequate cleaning of niche materials can lead to a host of issues over time. Applying the proper cleaner to the job can prevent expensive equipment failures and downtime.”
Specialty cleaners for efficiency and safety
Whether in a primary or secondary position, all of the specialty cleaners are mounted on a steel main frame attached to the conveyor, which holds the cleaning unit firmly in place. Located at the lower front section of the head pulley, under the discharge flow, primary cleaners clear the majority of adhered material. Secondary cleaners reside a few feet behind to assure thorough residual removal. Carryback — material stuck to the belt and cycled back through the system – can foul idlers, pulleys and skirt boards, leading to serious tracking issues that fray belt edges, weaken the splice and potentially cause accidents. Moreover, carryback material can pile on floors and pool in work paths, creating a hazardous workplace and requiring manpower for cleanup.
According to Marshall: “There is no one-size-fits-all cleaner. Matching the proper design to the specific belt and material traits is the best way to protect the system and personnel.”
Used widely across the food processing industry for light to medium duty applications, the Martin® Food Grade Cleaner is engineered to comply with conveyor specifications and belt sanitation requirements of the CFIA, FDA and USDA. Constructed of rigid low-density polyethylene or nylon blades and engineered with the company’s patented Constant Angle Radial Pressure (CARP) design to maintain the most efficient cleaning angle throughout its service life, the blades can be mounted with air tensioner, spring tensioner or hub mount tensioner for a consistently tight seal on the belt. This highly specific cleaner can be mounted in the primary or secondary position on belts from 4 in. to 48 in. wide (102 mm – 1219 mm) and is able to withstand temperatures of -40° – 380°F (-40° – 193°C).
The only motorised cleaner in the group, Martin® Brush Cleaners are specially designed secondary cleaners for the removal of fines and residue from ribbed, flighted, grooved or chevron conveyor belts. Available in two strong polypropylene bristle configurations, the straight line Strip Brush and the swirl pattern Spiral Brush are spun rapidly against the belt path by an energy efficient 230/460 Volt, 3 Phase, 60 Hertz motor.

Both systems are designed for temperatures of -20° – 180°F (-29° – 82°C), with the Strip Brush accommodating belt widths of 18 – 60 in. (450 – 1400 mm) using a 1 HP motor and the Spiral Brush cleaning belts 18 – 72 in. (450 – 1800 mm) with a 2 hp motor. The durable angle iron and stainless steel components provide long service in tough conditions against sticky materials or stringy fibres. Martin Engineering also supplies a brush cleaner for the European market, with bristle patterns for high and low moisture content materials.
For operators who choose not to use electricity to control carryback and buildup from chevron ribbed or cleated conveyor belts, the secondary Martin® Chevron Cleaner removes material using shock-absorbing torsion arms with elastomer blades composed of fourteen ½ in. (12 mm) wide “fingers.” These fingers allow the cleaner to accommodate the very specific geometry of chevrons. Able to handle belt speeds up to 500 ft/min. (2.5 m/sec.) and belt widths of 18 ¬– 96 in. (400 – 2400 mm), the telescoping arms eliminate the need to cut the mainframe during installation. High temperature or chemical resistant blades are also available.
The secondary Martin® H2O Cleaner is a system that incorporates a water spray for extra cleaning and dust suppression, and then uses a soft urethane blade to squeegee moisture from the grooves and indentations in the belt cover. With a blade length of 18 – 84 in. (400 – 2200 mm), the unit has the option to be fitted with two to eleven spray nozzles, delivering between 5 and 60 psi (.34 and 4.14 BAR) of pressure. The blades are engineered to handle belt speeds of up to 750 ft/min. (3.8 m/sec.) and temperatures of -30° to 180° F (-34° – 82.2° C), and can be specially treated to address various liquid materials from acidic to sticky. The blades feature a no-tool quick release system for easy replacement by a single worker.

For niche operators working with super heated materials, such as slag, hot clinker, asphalt and brick, the secondary Martin® High Temperature Cleaner is made to withstand some of the most punishing conveyed materials. The stainless steel system can withstand temperatures of up to 600°F (315°C) – approximately the melting point of lead — using overlapping tungsten or stainless steel blades, which are mounted on coil spring arms that wrap around a steel frame. Equipped with a Martin® Twist Tensioner to provide a tight fit for effective cleaning, this specialised system allows operators to avoid thermal adherence of hot material to the belt.
Though the systems are specialised, they can work in tandem with other standard belt cleaners or with each other.
“We take every detail into account and do extensive testing and monitoring to assure quality and proper functionality,” Marshall pointed out. “Part of being an expert in bulk handling is finding solutions and anticipating any problems that may arise, even from the solution itself, so that safety and operations are both enhanced.”
Edited from press release by Harleigh Hobbs
New World Resources Plc and New World Resources N.V. (NWR NV, and NWR Plc and NWR NV, together with their subsidiaries, the group) announce that the Board of OKD has met today to assess the status of the discussions between the Czech government and the the ad-hoc group of senior creditors of the group and shareholders in NWR Plc (the AHG); its current liquidity position; and its imminent liabilities.
So far, the Czech government has given no formal response to the AHG proposals. It is therefore unclear if an agreement between the Czech government and the AHG can be reached before OKD has exhausted all available sources of financing.
The group has indicated that it understands that the Czech government will be meeting on Monday 2 May to discuss the matter. However, the Board of OKD has met and decided that, in light of the current circumstances, it will reconvene on 3 May 2016 to discuss the potential filing of an insolvency petition by OKD. No decision regarding whether or not to file for insolvency has been made at this time.
The group has been in discussions with its stakeholders, including the Czech government and the AHG, since the beginning of December 2015, regarding a restructuring of liabilities and the provision of vital additional liquidity to OKD.
Since early January the Czech government has been provided with all relevant information about the Group and OKD. Last Monday, a diligence meeting took place between the Minister of Finance and OKD management. The information indicates that on current predictions, in the coming weeks OKD will require an external injection of money to remain in a positive cash balance and to be able to meet its financial liabilities, including paying the workers.
Against this backdrop, the Czech government and the AHG have been informed in writing on 25 April 2016 that unless, by close of business on Friday 29 April 2016, an agreement on a restructuring term sheet and/or a transaction involving the sale of OKD to the Czech Government is reached; and OKD obtains clear and sufficient assurance regarding the provision of additional future liquidity to OKD, the directors of OKD will have to consider the timing of filing for the insolvency of OKD and the discontinuation of OKD’s mining operations.
The Board of OKD has met on 29 April to assess the status of the discussions between the Czech government and the AHG; its current liquidity position and its imminent liabilities.
Edited from press release by Harleigh Hobbs
The London P&I Club has issued a warning about continued problems with the carriage of Indonesian thermal coal, after recent incidents involving owners and charterers.
Indonesian coal is prone to self-heat and/or emit methane, can lead to serious cargo fires, and an accumulation of methane can explode. The IMSBC Code states that coal with such characteristics should not be loaded if the temperature of the cargo exceeds 55ºC, and that the atmosphere in the holds is monitored at least daily on passage. The oxidisation process that can lead to self-heating can be detected by checking the hold atmosphere for rising levels of carbon monoxide (CO) and falling oxygen (O2) levels.
The IMSBC Code recommends that the ship carries a means of measuring cargo temperature, and requires that the ship is fitted with gas sampling ports.
Cases recently reported to the club have highlighted the need for thermometers and gas sampling equipment to be regularly serviced and calibrated in accordance with the manufacturer’s instructions. In one case in which the club was acting for charterers, the club-appointed surveyor arrived on board more than a week after the commencement of loading, only to find that a dispute over safety to load had in part been based on readings from equipment, which did not have a valid calibration certificate.
London Club Loss Prevention Manager, Carl Durow, said: “Care should be exercised in interpreting methane measurements carried out in the low O2 concentrations often found in unventilated cargo holds. Typically, manufacturers advise that methane readings will be meaningless if the O2 level falls below 10 per cent. But the club has seen evidence of ships’ staff relying on methane readings even when O2 levels have fallen to negligible levels (one per cent or less). In order to obtain meaningful information, measurements should be made via an approved sample point. The club has seen samples drawn through hold access hatches, which undermines the reliability of the measurements.”
“The atmosphere in the space above the cargo should be regularly monitored – and this may mean that measurements continue after arrival at the discharge port, particularly when discharge is slow. The club has seen problems with both self-heating and methane release worsening markedly during interrupted unloading.”
Edited from press release by Angharad Lock
SKF has introduced its Lincoln HTL 201 EEX hydraulically-driven pump for use in volatile applications, such as underground mining. Featuring a steel pump body and lubricant reservoir, this unit is a cost-effective alternative to expensive electrically driven pumps that must include a cabinet for protection.
Designed to minimise friction and wear, the HTL 201 EEX is operated via the hydraulic system of a superior machine or carrier system and supplies lubricant as long as that machine or carrier device is active. The HTL 201 EEX is based on the proven Lincoln HTL 201 hydraulic tool lubricator concept and includes a grounding point to discharge electricity immediately, if needed.
Compact and durable, the HTL 201 EEX is easy to install and maintain. Its refillable reservoir holds 1.5 l (52.9 fluid oz) of NLGI grade 2 grease. The pump unit has an integrated throttle to adjust the lubricant output, and it accepts progressive metering devices.
The HTL 201 EEX is approved for underground coal mines in Australia and South Africa and is currently undergoing the process for ATEX approval in Europe.
Edited by Jonathan Rowland.
Colin Hamilton
We remain in the wrong type of global economy for commodity markets, with emerging market demand weak, China adopting a less commodity-intensive growth path and global industrial production struggling for any growth. This comes after a period of high investment in supply capacity – the likes of which has never been seen. No wonder most commodity prices have been flirting with multi-year lows. However, in Macquarie Research’s opinion the dry bulk freight market is facing more amplified problems than most – particularly relating to the demand side of the equation.
Why so dire?
The long-favoured explanation for the freight market’s demise is overbuilding of new vessels, which has left a substantial overhang of supply capacity in a notoriously inefficient market. However, just as capacity growth has been moderating, demand growth, which ran at around 6% CAGR in the decade to 2014, has collapsed. Macquarie’s expectations for iron ore and coal trade suggest that, structurally, the demand picture will not get better from here. Thus, although current freight rates are unsustainably low, there is not much to suggest things will turn around quickly.
With iron ore, metallurgical coal and thermal coal all effectively priced from a CFR China reference, the winners from low freight rates are bulk commodity producers, who receive a higher FOB price at the export port, all else being equal. In the CFR China, iron ore assessment freight is now just 6% of the price versus more than 35% in early-2008. Of course, all else is not equal, and this has not been enough to offset the headline fall in iron ore prices of the past few years. It does, however, illustrate that miners could be in even worse shape than they are currently.
One of the things that has often been taken for granted by freight-market participants is that trade volume growth, particularly after the exceptionally strong years of 2010 – 2014, would continue. But the China slowdown, the less commodity-intensive nature of world growth and a shift away from coal-fired power generation means that these expectations fell flat on their face in 2015. The research group’s expectations going forward are negative too.
Iron ore, thermal coal and metallurgical coal combined account for around 60% of world seaborne bulk trade. Macquarie estimates that these volumes fell 1% last year and the group expects them to continue to fall at a similar compound rate over the next five years. Structurally, there is no positive story from a seaborne demand angle. In iron ore and metallurgical coal, the research group sees global pig iron as having peaked due to no steel demand growth and an increase in scrap usage in China. In thermal coal, Macquarie thinks consumption has more or less peaked, while seaborne trade has been additionally cut substantially by Chinese protectionism and higher domestic supply in India.
The demand collapse is unfortunate because net fleet supply growth has fallen to the lowest level in over a decade. However these growth rates are still positive, the legacy of the overcontracting that continued to be seen after the global financial crisis and, most recently, in 2013. Given the three to four year cycle between contracting and actual delivery, the expectation is that net fleet growth will rise this year again. After 2016, the orderbook looks leaner and with new vessel contracting having fallen to its lowest level since 2001, supply growth should slow more significantly after that. Much will depend on how scrapping evolves. It was close to an all-time high in volume terms last year but is challenged by the fact that the current fleet is so young by shipping standards. A combination of freight rates and vessel age, rather than the scrap steel price, is ultimately what drives scrapping.
Iron ore: stagnation before contraction
Of course, the iron ore market is of particular importance for freight. After continuous growth since 2001, global iron ore trade very much stalled in 2015. However, given the drop in global steel output, this is actually better than it might have been.
Total 2015 seaborne iron ore trade grew little more than 15 million t over 2014 volumes, which is a stark change from the more than 120 million t annual additions seen over 2013 and 2014. Perhaps the surprise has been the relative market efficiency over this transition, with supply exiting the market on a steady basis as prices moved lower.
With global steel production down 3% over 2015, and set to fall again this year, iron ore has had to react, and, from the start of 2015, production has trended back towards zero growth. However, even that exceeded pig iron production volumes at iron ore importers, which was in negative y/y territory all year. To balance the books, Chinese domestic ore production took the brunt of displacement.
With Chinese blastfurnace output down 2% y/y in 2015 and in Macquarie’s opinion set to decline further in the coming years, the research group now expects a slow but steady declining trend in import volumes through the end of the decade. This is reinforced by its view that Chinese domestic iron ore output will remain relatively resilient from here. On Macquarie’s modelling, China does not ever reach the 1 billion t mark that was long expected by major iron ore producers. Essentially, Chinese steel output stagnation flows straight through into iron ore trade stagnation.
This certainly does not mean the Chinese market is static in terms of supply origin – in fact, far from it. While Australia has grown total exports consistently, all of this growth has gone to China. In contrast, exports to Japan are trending lower. Brazilian material (dominated by Vale) has done the opposite – falling into China but rising into the traditional markets of Europe and Japan. While at a headline level, iron ore trade looks uninteresting, the sub-plots persist.
Key among the changes in Chinese imports has been the disappearance of supply from many smaller countries as prices have fallen. China’s imports from countries outside of Brazil, Australia, India and South Africa were just 54 million tpy in 2008 and 82 million tpy in 2009, but grew to 212 million tpy in 2013 amid rising prices. This process has reversed equally as fast, with 2015 seeing just 110 million tpy of this material. Many of these countries – Swaziland, Honduras, Mexico and the US for example – now ship no ore into the Chinese market. As a result, since 2013 the share of these suppliers in Chinese imports has fallen from 25% to 12%, while Australia has grown from 50% to 64%. This trend is set to continue with the arrival of the Roy Hill mine to the market, with first shipments due imminently but the real impact of the ramp up felt into 2Q16.
With the exception of Vale’s 90 million tpy S11D operation, which Macquarie have been ramping up from 2017, Roy Hill marks the last 25 million tpy plus ramp-up expected from the majors (who Macquarie classify as BHP Biliton, Rio Tinto, Vale, FMG, Anglo American and Roy Hill). Despite this, the group still expect to see growth from these companies of ~4% over 2016, assisted by strong performance at existing assets. While ones, such as Rio Tinto’s Hamersley, have been supported by greenfield ramp-ups, even the ‘declining’ Southern and Southeastern systems for Vale are up, helping the majors regain some market share.
The arrival of Roy Hill in turn raises the question of where this material will be placed. Given that the key backers of the project are Korean, Macquarie expects this to be the destination for much of this material. With Korea now an ex-growth market in terms of steel output, someone will have to make way. Presently, BHP and Rio are dominant in terms of supply into Korea and look most at risk of losing share to Roy Hill. Depending on how the marketing arms of these companies react, this process could be the 2016 challenge for iron ore, were the displaced material to have to be sold in the spot market. In the group’s view, 2Q16 will be the test case here as to how much smarter BHP, Rio and Vale have become around managing supply to the market to underpin prices.
To put the changes in context, compared to Macquarie 2014 forecast, the research group now expects 200 million t less iron ore trade by the end of the decade, which will make any recovery in bulk carrier fleet utilisation (and freight rates) a very, very slow process.
Thermal coal: they think it’s all over…
What about thermal coal, number two in the dry bulk demand ranking? Thermal coal prices have already been falling for five years and Macquarie expects further declines. Indeed, the group classes thermal coal as its least preferred commodity exposure. An appropriate analogy might be that being a seller of thermal coal today is probably how it felt to be a seller of wood as coal itself was taking over as the dominant energy source. Or perhaps how it felt being a whaler in the mid/late 1800s as whale oil was almost entirely substituted by kerosene. You know that global consumption has more-or-less peaked; you just are not sure how quick the demise will be.
Europe and the US are shunning coal en masse, while demand expectations for key Asian consumers, previously expected to pick up the slack, are also being revised lower. A global drive towards cleaner energy, collapsing gas prices, falling power intensity of economic growth (under performance of the global industrial sector in general) and increasing power plant efficiency are all key drivers. And if global consumption has more-or-less peaked, the seaborne market, which sets the international price, is doing even worse. It has been in contraction since 2013, due to Chinese protectionism and India being able to supply more of the coal it needs domestically. Speaking of the latter, India provided virtually the only import growth of note in 2015. Yet 2H15 performance was weak and consensus expectations have more-or-less shifted to India having reached peak coal imports.
Perhaps these trend-extrapolated conclusions are premature, considering the scale of Indian infrastructure development required to sustain recent performance. However, domestic coal production is growing more quickly than coal-fired power generation for the first time in years and on top of that, India is now looking seriously at renewables (solar in particular). Considering that Macquarie expects further declines in Chinese imports, on the back of both structural weakness and potentially more protectionism, this is going to mean continued market contraction and the need to displace more supply. This needs to happen in an environment where cost deflation is yet to abate, meaning the US dollar price will need to work hard.
The cuts have thus far been concentrated in Indonesia and Macquarie assumes the market adjustment will continue to come from here going forward. The competitive position of Indonesian coal miners has deteriorated over the past 18 months, with the majority of mining costs being US dollar denominated, government fuel subsidies being removed and efficiency gains being exhausted. On top of that, when looking at ease of cutting supply globally, Indonesian producers are top of the list. As much as 40% of production comes from small private operators, with limited balance sheet flexibility and less burdened by infrastructure and labour-force liabilities. Although exact cost structures are opaque, a relatively safe commodity market assumption is that the more volume needs to be removed, the harder it gets. It now seems inevitable that Indonesian supply will continue to fall, with negative price implications.
Putting everything together
The new normal for freight is one where the market has to adapt to not only slower demand, but falling demand y/y. This is over and above the risk of bulk commodity producers facing bankruptcy. As such, the current market problems seem set to be a duration event rather than a blip.
Written by Colin Hamilton, Macquarie Research, UK. Edited by Harleigh Hobbs. This article first appeared in Dry Bulk Spring. To read this and much more, register to receive a copy of the issue here.
Rebecca Pyper, Dome Technology, USA
When Dome Technology CEO Bradley Bateman met with China Coal management, it was clear what the company wanted: a high live-reclaim system at an economical price – and good looks did not hurt either.
China Coal sought storage facilities for both its Hulusu and Menkeqing coal mines, located 15 miles apart in north China’s Inner Mongolia Province. Based on the ability to keep outside moisture out, Bateman said a series of domes was a more economical solution than traditional silos. And in the land of the yurt, another factor “was the aesthetics; it was the way they look,” he said.
Today, visitors to one mine will see three identical domes housing 60 000 t of coal apiece and in the distance three more identical domes at the other mine. But what visitors will not see is an innovative material-handling system inside the domes that gives China Coal what it wanted most: the ability to move product – and move it fast.

Conveyor systems work seamlessly with domes to ensure desired throughput speed.
Supply and demand
As more and more Chinese citizens plug in their phones and electronic devices everyday, power companies are relying on and demanding coal as an energy-source generator at power plants. And China Coal is ready to sell.
“[China] is an emerging country and they have an energy shortage – that’s why companies like this are developing in this region,” Bateman said.
Careful planning was the first step for the project, beginning with storage size. Domes made more storage possible within a smaller footprint, so China Coal could store more product in a smaller footprint than warehouses and flat storage, stacking it deeper and taking up less valuable property at the sites. While common for businesses to require three to five flat-storage buildings, one dome often accommodates the same amount of material in one structure. The double curvature of a dome lends itself to strength and the ability to build up, rather than out.
The storage space available on a relatively small piece of land was one of the most significant dome advantages, explained Zhao Jiapeng of China Coal. But solutions for issues, such as dust production, spontaneous combustion and explosion, required attention if the project were to be successful.
For companies planning a coal-storage facility, Engineer for Dome Technology, Adam Aagard, said much of the discussions up front should centre on fire protection, environmental protection and desired reclaim rate. Here, these important considerations are explained, with details on why specific features were chosen.
Good detection and protection
According to Zhao, the possibility of coal self-igniting in the dome was one of China Coal’s main concerns. Coal’s volatile nature causes it to self-heat, easily ignite and produce flammable coal dust from something as simple as equipment vibrations. These features promised protection:
Thanks to a dome’s PVC membrane and layer of insulation, stored coal maintains its calorific value by keeping dry. The dome’s insulated nature also prevents heating and cooling of the walls and air inside, thus thwarting condensation that could contribute to spontaneous combustion.
Fire-protection experts recommend coal be stored in facilities with few surface areas for dust to collect. Since domes are built without the use of interior supports, there is no worry about dangerous dust build-up on trusses. Secondary explosions – the kind caused when initial explosions shake loose accumulated coal dust – are less likely because the support-free domes have no ledges for dust to build up.
The domes’ design allowed the company to render the pile of coal inert by sealing the top and bottom to cut off oxygen sources and by pumping nitrogen to lower the oxygen level.
With a thermal scanner over the belt on the inbound receiving side, infrared cameras check temperatures on coal, while on the belt, to make sure no off-spec product enters the dome.
A linear heat cable monitors for fire on the belt, also examining bearings in case one is throwing sparks; this cable might detect a fire travelling along the belt length before it reaches the thermal scanner. A product unique to combustion-prone materials, the system shuts down conveyance and alerts facility management of the fire. Depending on the setup, workers can either extinguish the fire or an existing fire-suppression system takes care of the problem.

The floor of the domes while under construction; the finished product yields 100% live reclaim.
Material handling in a hurry
How fast and how well a company moves product will translate into how fast it makes money. So selecting the right reclaim and handling systems – not just those moving product within the structure – as well as loading and reclaim systems were key for China Coal’s future financial success.
Inside the domes in China, a full hopper system similar to a series of funnels situated side by side allows coal to flow through the structure under its own weight rather than by loader. “Inside this dome it’s a 100% live-reclaim system, which is not new to the industry, but on this magnitude, it’s pretty new,” Bateman said, adding that this design allows each dome to be completely emptied every three days, which met China Coal’s throughput needs. Especially for the lower-volatility coal that is stored in these domes, this model is ideal because the coal’s shelf life is long enough to be safely stored in that scenario.
At each of the two sites, Dome One, located closest to the mine, houses coal arriving fresh from the mine. It stays here until it exits the dome, passing through a cleaning and washing process before being milled to achieve the right-sized pieces. From there coal is dumped via conveyor into Domes Two and Three, where it later exits the structures in one of three tunnels and is transported to trains waiting just outside.
An environmentally conscious approach to storage
Coal dust demands attention because it is a pollutant. The dome is an effective vessel for mitigating dust concerns because it is seamless and airtight – and that yields air protection. Since no rain can enter the structure, it will not mix with dust and cannot be leeched into ground water either.
To collect dust is essential; it reduces the risk of combustion, and it helps companies meet environmental regulations. A Chinese vendor installed the dust-collection system for the China Coal domes. The following are a few common options for dealing with dust:
A spray-down system literally sprays coal with water to wet the dust, preventing it from becoming airborne. Because water decreases coal’s useful BTU value, this system is not popular. One variation is to spray oil onto coal instead of water; the dust is still managed, but the useful BTU values are not reduced – though companies will have to assign a portion of the budget to purchasing mineral or vegetable oil.
A baghouse system sucks in air and pulls particulates through a fabric filter. Because it is a dry system collecting dust and storing it in high concentration, the chance of combustion within the system is still real.
The preferred approach is a wet scrubber, “which essentially pulls the dust through a water system so it becomes wet, and that’s what pulls out the dust, rather than a bag, so now the dust is wet and not nearly as combustible,” Aagard said. The system pulls the dust through a duct until it can be removed from the facility or destroyed.
Regardless of the type of dust collection, an automatic system can be installed to convey dust away – whether pneumatically or on a belt – to a combuster. Another option is for dust to be collected in a bin or super sack and hauled away.
Conclusion
Thoughtfully planning a storage and material-handling facility provides peace of mind in operation. But it also has allowed China Coal to process its product faster today. Production moves at a rate comparable to the one Dome Technology set during the engineering and construction process, which lasted just 18 months. “It was a fast-paced schedule – very aggressive – and we met their deadlines,” Bateman said.
The project was completed in August 2015, a true joint effort between China Coal and Dome Technology. “The achievement from the Menkeqing and Hulusu projects belongs to both of our corporations,” Zhao said.
Written by Rebecca Pyper, Dome Technology, USA. Edited by Harleigh Hobbs. This article first appeared in Dry Bulk Spring. To read this and much more, register to receive a copy of the issue here.
Harleigh Hobbs
The Humber Estuary is home to some of the UK’s major ports, including the Port of Hull, the Port of Goole, the Port of Grimsby and the Port of Immingham. They form the UK’s biggest trading gateway and the fourth largest port complex in Europe.
The Port of Immingham, owned and operated by Associated British Ports (ABP), is located along the south bank of the Humber. Set on an estuary with naturally deep water channels with easy access to major trade routes, Immingham is ideally located for the easy distribution of many types of cargo. It is the UK’s largest port in terms of tonnage, handling approximately 50 million tpy of freight – 20 million tpy of this is dry bulk.
The estuary’s naturally deep waters made it a perfect location for creating a port and town in 1912. Originally established to export coal mined in the Midlands and Yorkshire, it has grown with the industry and now handles both the import and export of a range of commodities and is constantly developing to accommodate industry needs.
The port handles dry bulk, such as coal, ores, grain, fertilizer, road salt and biomass, as well as crude oil, LPG, ro-ro/lo-lo, containers and even Trafalgar Square’s traditional Christmas tree from Norway!
Dry bulk terminal
In the last fifteen years, the dry bulk facilities at Immingham have gone through major changes and developments. In 2000, Immingham’s Humber International Terminal (HIT) was opened. More than £30 million was invested into this development, adding a 300 m berth to the west of the existing Immingham Bulk Terminal. HIT handles solid fuels, such as coal, as well as biomass, animal feed, fertilizer, road salt, grain, iron ore and other minerals. In response to an increase in coal imports, in 2003, Humber International Terminal’s second berth (HIT 2) was constructed, costing £60 million and extending HIT’s total quay length by 220 m – enabling it to handle a panamax and a capesize simultaneously on a 520 m quay. HIT 1 focuses on the handling of biomass and HIT 2, coal. Each year, the port handles approximately 10 million tpy of coal and can handle up to 6 million tpy of biomass.
In 2015, HIT set its own record for the highest ever single shipment of grain: 66 000 t.
Solid fuels unloading
HIT can accommodate vessels carrying cargo up to 130 000 t. Coal is often imported from Russia, Colombia, the US and Poland, while biomass is imported from Russia, Canada and North America. The terminal operates a crane and grab system to unload coal, and Siwertell continuous ship unloaders (CSUs) to unload wood pellets. The HIT 1 berth is dedicated to biomass unloading. It discharges with the two CSUs at a rate of 2400 tph – three times faster than a crane. This makes a significant difference to discharge rates.
Material is fed directly onto the overground closed automated conveyor system, which takes biomass to silo storage facilities.
Transfer towers are located along each conveyor, within which there is a diverter gate that brings the product up to a radial arm where the coal is discharged straight down to the coal stockyard.
Two rail lines feed the terminal, which then branch off into three lines. One rail line goes to a coal and biomass loading line, one purely biomass and one purely coal. This makes it easier for the rail lines to switch if any problems arise.
Storage
At the end of the conveyors, two semi-automatic stacker reclaimers deposit the unloaded coal into the 40 ha. stockyard. Coal is stored here until it’s called off by the customer. The stockyard is capable of storing 1 million t of coal at any given time. Stockpiles are segregated to ensure no contamination of different quality coals with a distance of approximately 3 m between piles. Stocks are also mapped via GPS to ensure each product is kept separate and can be readily identified for call-off.
ABP has made major steps forward with the storage of biomass (which will be discussed in more detail below).
Biomass is transported to one of eight silo storages via a 1.2 km overground conveyor. Here biomass is stored for an average of 2 – 5 days.
There is also ABP Immingham Bulk Park, which is a dedicated bulk store that offers storage, including undercover bulk storage capacity of 30 000 m2. This is an entirely separate operation that is not part of HIT/IRFT and is located on the other side of the port estate.
When the biomass is ready to be dispatched to Drax power plant, which has converted three of its six boilers to run on biomass, and supplies approximately 7 – 8% of the UK’s electricity demand, it is sent from the silo to the rail loadout by an underground conveyor system.
Distribution
Cargo is distributed primarily by rail, but a small amount is sent via road. There are approximately 144 paths out of the terminal for coal and 12 for biomass.
Following recent developments at the port, rail loading facilities for coal and biomass can now load trains with up to 24 x 70 t railcars in just 30 min., handling up to 36 trains per day with the potential to move up to 57 600 t in excess of 2 million tpw.
The rail loading facility is made out of concrete and has two concrete feeders. The Drax railcar system is a fully automated system for loading. The railcar goes in with magnet triggers opening the doors and then closing them at the end. No personnel are required in operational areas, which reduces risks and hazards as people are only required in the control room.
From here, biomass is exported directly to Drax power plant in North Yorkshire.

The eight silos of Immingham Renewable Fuels Terminal are capable of storing 200 000 t of biomass.
Prepared for the long term
Following Drax’s announcement to convert three of its coal units to wood pellets in a move to focus on renewable energy, ABP put forward a terminal expansion proposal to help sustain a long-term future for biomass: the Immingham Renewable Fuels Terminal (IRFT). The contract for this was awarded in March 2013 and the development commenced in May 2013. It is now the biggest biomass facility in the world.
ABP invested £130 million into the facility, which included the construction of 4 x 25 000 t silos. Each silo was constructed in eight days, growing approximately 3 m every 12 hr. A new rail loadout facility was created for delivering biomass straight to Drax in North Yorkshire. It has purpose-made railcars for Drax and each railcar cost £125 000. There are six sets of 24 railcars – £3 million worth of railcars.
In March 2014, the port entered phase two of IRFT. This included the construction of 2 x Siwertell CSUs, a second rail loadout expected to be commissioned in 2Q16 and a further 4 x silos. The four additional silos will increase storage capacity from 100 000 t to 200 000 t.
Installation of IRFT
During the construction and installation of IRFT, coal operations continued and the port met its contractual tonnage. This is impressive because the port has a relatively small footprint compared to other international ports and can only accommodate around 900 000 t. Yet it has attained high tonnage input and output of 14 million t in 2015, even with the IRFT development happening right on top of it. This demonstrates the key role effective communication played between the engineers and port personnel.
With its relatively small footprint and decision to maintain operations, the installation process was inevitably going to face some difficulties. But the way these were overcome, again, highlights effective close communication between all workers involved. Richard Camm, the Rail Terminal Operator, explained: “if the communication wasn’t there, we would have struggled.”
He continued: “one of the trickiest things was building the rail infrastructure in and amongst rail movements and still keeping the coal going out.”
The new Biomass Loadout was built over and next to operational running lines loading and delivering coal to customers with minimal disruption to production – a fact Camm puts down to the success of close communication.
The logistics of getting equipment to the facility, storage of equipment and making sure it was in the right place at the right time was also a challenge. The port needed to factor in the shipping movements and traffic going off the port via lorry. Careful forward planning minimised potential obstacles and facilitated the installation process.
Quality control measures
The port has an automatic sampling system in the transfer tower. A company that works for Drax manages this. Environmental Scientifics Group Ltd takes samples to a laboratory and can extract things, such as fines.
There is a magnet on the first conveyor, which removes ferrous metal to a hopper, while on the second conveyor there is an induction coil metal detection system, which detects any metals (ferrous or non-ferrous) not picked up by the first magnet.

£15 million was spent on two bespoke CSUs as part of the IRFT investment.
Health and safety
Along with the five point PPE required across all ports, the Port of Immingham implements a range of health and safety measures for protecting both personnel and products.
The facility has a spark detection system called FireFly. At every point in the transfer towers where there is a change in direction via a chute, there is a system that detects a heat source or a spark. If either of these are detected, it will instantly trigger a water spray that will turn the system off, working on the emergency shutdown system (ESDS) and shutting the whole facility down.
On both sides of the conveyor, there is a heat sensing cable, which is predominantly focused on the belt itself, for example detecting an overheated roller. This cable is linked to a water deluge system and, if a heat source is picked up, the deluge system will activate and flood the whole area in the hazardous section, as well as flood the section ahead of it to accommodate the belt travelling at a certain distance and stopping any heat source.
Inside the silos, the facility has temperature monitoring probes. A cable is suspended in the product to pick up a change in heat source.
Any of the preceding heat detection measures, if activated, would shut down the whole system, including the CSUs.
At the top of the silos, there are fast-acting valves to protect personnel working at the facility if an explosion risk in the silo were to occur. If there was an explosion risk in a silo that is propagating up into the conveyor system, where personnel could be situated, the valves will shut the access point into the silo where the product is entering, in milliseconds.
Dust control
The coal side has five banks of rain birds, a sprinkler system that acts as dust suppression on the coal stockyard in dry and/or windy conditions.
The biomass system has dust suppression systems at every conveyor change of height. This is a vacuum system that reintroduces the dust back onto the belt in a more manageable manner.
Conclusion
ABP’s Immingham Port’s recent developments have demonstrated the port’s ability to respond to market changes and prepare for the future.
With the freight industry constantly changing, the port intends to continue to innovate and invest in order to meet market demands and service the needs of its customers.
Written by Harleigh Hobbs.This article first appeared in Dry Bulk Spring. To read this and much more, register to receive a copy of the issue here.
Essar Bulk Terminal Ltd, Hazira (Hazira Terminal), a subsidiary of Essar Ports Ltd, which is one of the largest port companies in India and is part of Essar, has received an approval from Gujarat Maritime Board (GMB) to handle 15 million t of merchant cargo over three years.
Based on this approval, the Hazira Terminal, in keeping with its design and capabilities, will be able to handle a range of cargo for merchant customers, including dry bulk, liquid bulk, containers and so on.
The approval was granted under GMB’s captive port policy where jetties built on captive licences can handle third-party cargo up to a maximum of 50% of the total cargo handled. This approval stands to benefit the local industry who will now have access to a modern port facility. It will also increase the revenue to the government because of better utilisation of port capacity.
Hazira Terminal has a capacity to handle 30 million tpa of cargo according to Rajiv Agarwal, Managing Director – Essar Ports Ltd. He stated: “Hazira terminal has a strong industrial hinterland. Various coal traders and other industrial customers have entered into agreements with us to handle their cargo through Hazira Terminal to take advantage of our deep draft and high mechanisation, which result in significant cost advantages to our customers. Our all-weather terminal also presents opportunity for these customers to utilise port services when nearby Magdalla port closes during monsoon season.”
The permission for handling third-party cargo to Hazira terminal was earlier provided on a case-to-case basis. The current permission allows it to handle 15 million t of commercial cargo over three years. Further approvals may be sought once the 5 million t of cargo is handled. GMB will benefit from this arrangement since the wharfage charges it collects for the commercial cargo handled at Hazira Terminal is 1.5 times the wharfage received by GMB at other ports.
Hazira terminal has already started handling merchant coal cargo under this approval and handled 0.75 million t until date.
Edited from press release by Harleigh Hobbs
MICROMINE, a leading provider of intuitive software solutions to the global exploration and mining industry, continues to strengthen its partnership with Carlson Software Inc. after a recent week-long visit at MICROMINE’s Perth HQ.
Pitram, MICROMINE’s leading Fleet Management and Mine Operations Solution for underground mines, will be integrated with Carlson’s machine control solutions. The objective of the integration is to enhance Pitram’s machine guidance and fleet management capabilities.
Introduced to the market in 1997, Carlson’s machine control solutions have a solid history of machine guidance in mining, landfill, dredging and 3D drilling markets. Through the provision of hardware and software for High Precision GNSS guidance, Carlson ensures machine units are operated precisely and according to plan, eliminating inefficiencies and unnecessary costs.
Pitram is an essential and proven system for the management, control and process improvement of mining operations. Pitram is used to record and process equipment, personnel, locations and materials data, providing an overall view of mine status, thereby increasing control and efficiency. Pitram’s analytical tools help mine controllers and engineers identify operational constraints, improve the utilisation of resources and increase production.
The integration between the two systems will increase Pitram’s surface fleet management capabilities by providing high-precision machine guidance. Equipment operators will be able to perform activities, such as drilling, excavation and loading more precisely, ensuring objectives are achieved more efficiently.
MICROMINE Chief Operations Officer, Michael Layng said: “MICROMINE’s partnership with Carlson will provide significant benefits to both existing and future Pitram customers globally. Through the introduction of machine guidance within Pitram, we are strengthening the solution’s fleet management capabilities.”
“MICROMINE is looking forward to working directly with Carlson and to integrating and developing new solutions not only with Carlson but also with the company’s extensive dealer channels in selected regions”.
Edited from press release by Harleigh Hobbs
Carbon Energy Ltd has announced the company’s participation in the formation of a globally significant underground coal gasification (UCG) research centre in China in conjunction with one of the world’s largest mining universities, the China University of Mining and Technology (CUMT).
The company has two representatives on the governing body of the CUMT International Research Centre for Underground Coal Gasification, which has been established to develop the highest standards for China’s growing UCG industry and was officially opened on 24 April 2016 in Xuzhou, Jiangsu Province.
The Centre will initially be funded by Chinese private industry participants and CUMT, and it is anticipated that additional funds for the Centre will become available from government sources.
The centre has established a technical advisory committee consisting of a panel of international experts renowned for their industry, academic and scientific achievements, and includes the previous Chief Scientist of Australia, Professor Robin Batterham. In his remarks during the opening of the centre, Professor Batterham noted that there are many areas where UCG can be competitive as coal is often available where natural gas is not, particularly in China and where coal seams are too deep and too variable to warrant mining. He also noted that UCG offers the chance to utilise such resources in an effective and responsible manner.
The establishment of the centre is an important step forward in the advancement of Carbon Energy’s expansion plans in China, where the company has a joint venture with Beijing JinHong Investment Co. Ltd to develop a vertically integrated gas business in China.
Morné Engelbrecht, CEO of Carbon Energy, commented: “This is an important development in a market that is highly receptive to UCG technology. The establishment of the centre funded by the university indicated the country’s willingness to establish a world leading UCG industry based on science.”
According to Carbon Energy, China’s strong demand for lower emission coal technologies, as well as its supportive government policy, makes China a compelling opportunity for the company’s keyseam technology. The centre has been established to encourage the development of UCG technology by industry and Government groups alike, as the environmentally acceptable utilisation method for coal. This is closely aligned to the Chinese government’s 13th five-year plan, which is a vital macro driver underpinning the expansion of China’s UCG industry.
It is intended that the centre will bring together potential collaborators in the industry to evaluate technologies for specific coal deposits and industry applications and is an important platform for Carbon Energy to showcase its technology to an influential and highly receptive industry audience in China.
The centre will seek to simplify the regulatory process by establishing national and international standards of operation for UCG and formally seek recognition by government. These clear parameters are expected to encourage further investment in the industry in China. The work of the centre is expected to support project developers in obtaining permits and to significantly reduce the time required to commence projects.
Edited from press release by Harleigh Hobbs
Consumption of steam coal used for electricity generation in the US electric power sector fell 29% from its peak of 1045 million short t in 2007 to an estimated 739 million short t in 2015. Consumption fell in nearly every state, rising only in Nebraska and Alaska over that period.

Source: EIA.
In the US, 97% of all steam coal is used to generate electricity. The price and availability of fuels other than coal have had a major effect on coal consumption since 2007. Increased supply of natural gas and a resulting natural gas price decline spurred increases in natural gas-fired power generation in several states, generally at the expense of coal-fired generation. Electricity generation from wind and solar sources also increased significantly over this period, driven by a combination of federal tax credits, state-level mandates, and technology improvements.

Source: EIA.
Coal use in the electric power sector decreased in Ohio, Pennsylvania, and Indiana by 49%, 43%, and 38%, respectively, between 2007 and 2015. In Ohio and Pennsylvania, increased production of natural gas from the nearby Utica and Marcellus shale plays resulted in more and relatively less expensive natural gas being available to power plants in these states. Indiana’s legislature created a voluntary energy portfolio standard, which took effect in 2012, encouraging electric utilities and retail power generators to generate more electricity from renewable fuels and nuclear, as well as from any natural gas generators that displace existing coal-fired generation. Combined natural gas consumption at electric power plants in Ohio, Pennsylvania, and Indiana increased from 219 billion ft3 in 2007 to 777 billion ft3 in 2015. Coal consumption from these three states fell from 176 million short t to 100 million short t over the same period.

Source: EIA.
In the Southeast, coal consumption in Georgia, North Carolina, and Alabama in 2015 was half the level it was in 2007. Electric power plants in these states increased their natural gas consumption from 338 billion ft3 to 1021 billion ft3, and they reduced their coal consumption from 110 million short t to 56 million short t.
The decline in power sector coal consumption across these six states was often accompanied by shifts in coal supply sources. In general, imports and receipts of coal from distant sources decreased the most. Indiana and Ohio received much less coal from the Powder River Basin in Wyoming and Montana in 2015 than in 2007. In both Georgia and North Carolina, the largest decline in coal receipts came from Central Appalachian coal, which was partially offset by higher receipts of Illinois Basin coal.
Edited from source by Angharad Lock
Teck Resources Ltd has released its 15th annual Sustainability Report, covering the company’s performance in 2015 and progress towards its short- and long-term sustainability goals.
“At Teck, we are committed to developing resources in a manner that is socially and environmentally responsible and makes a positive contribution to the communities where we operate,” said Don Lindsay, President and CEO. “Thanks to the hard work of employees across our operations, we have achieved all of our 2015 sustainability goals, which led to improvements in performance and efficiency at our sites, including reductions in greenhouse gas emissions, strengthened water and biodiversity management and improved safety performance.”
Teck’s approach to responsible resource development is guided by a sustainability strategy, which sets out a vision and short- and long-term goals in six areas of focus: Community, Its People, Water, Energy and Climate Change, Air, and Biodiversity. In 2015, Teck marked five years since the development of its strategy and the completion target date for its first set of short-term goals.
2015 sustainability performance highlights included:
- Improved safety performance with a 25% reduction in high potential incidents (HPIs) and zero fatalities.
- Reduced annual greenhouse gas emissions by approximately 200 000 t and energy consumption by 1200 terajoules since 2011.
- Reused and recycled water an average of 4.5 times at our mining operations.
- Tailings review boards established at 100% of Teck’s operations with major tailings facilities, as part of its comprehensive tailings management and safety programme.
- Continued commitment to diversity, with a 56% increase in the number of women in operational and technical roles since 2010.
- Reached seven new agreements with Indigenous Peoples in the areas where they operate.
- Implemented biodiversity management plans at all operations focused on Teck’s long-term vision of having a net positive impact in the regions where they operate.
In 2015, Teck was named to the Dow Jones Sustainability World Index (DJSI) for the sixth consecutive year, the Global 100 Most Sustainable Corporations list by Corporate Knights for the fourth consecutive year, and the FTSE4Good Global Index for the first time.
Edited from press release by Harleigh Hobbs
National Mining Association (NMA) President and CEO, Hal Quinn, commented on the recent climate change agreement signing ceremony in New York City, US:
“What is missing from the administration’s celebratory rhetoric surrounding the Paris agreement is that its own plan for addressing global warming – aside from being stopped by the Supreme Court for its questionable legality – bears a still more fundamental flaw. It ignores the fact that reaching the UN’s temperature reduction goal will not be achieved by regulations designed to drive US coal out of the market. That goal can only be achieved by aggressively supporting the testing and deployment of high-efficiency, low-emissions technologies for use globally.”
“But by refusing to acknowledge the technology solution, the administration has inexplicably turned its back on the most responsible pathway for addressing the issue it claims is urgent – as well as on the hundreds of millions of the world’s poor who lack or will lose affordable electricity,” continued Quinn.
Edited from press release by Angharad Lock
Diana Shipping Inc has announced that, through a separate wholly-owned subsidiary, it agreed to extend the present time charter contract with Transgrain Shipping B.V., Rotterdam, for one of its Panamax dry bulk vessels, the m/v Clio. The gross charter rate is US$5350/day, minus a 5% commission paid to third parties, for a period of minimum 11 months to maximum 14 months. The new charter period is expected to commence on 5 May 2016.
The “Clio” is a 73 691 DWT Panamax dry bulk vessel built in 2005.
The employment extension of “Clio” is anticipated to generate approximately US$1.77 million of gross revenue for the minimum scheduled period of the time charter.
Diana Shipping Inc.’s fleet currently consists of 45 dry bulk vessels. At present, the combined carrying capacity of the Company’s fleet, excluding the four vessels not yet delivered, is approximately 5.2 million DWT with a weighted average age of 7.56 yrs.
Edited from press release by Angharad Lock
TÜV SÜD has announced the successful completion of Performance Guarantee (PG) Tests of the Boiler, Turbine, Generator (BTG) package of Kalisindh Coal based thermal power plant in Jhalawar, Rajasthan, India. After successfully conducting, executing and calculating of the PG Test, TÜV SÜD submitted the final report to BGR Energy Systems Ltd as per ASME PTC Codes, Standards and compliance.
TÜV SÜD recently set up a state-of-the-art performance testing centre in India, which will render performance guarantee and efficiency testing services, catering to India and the Asia Pacific belt.
TÜV SÜD has conducted following Performance Guarantee Tests (PGT) on the BTG (Boiler Turbine Generator) package of Kalisindh Power Plant as per the following ASME PTC standards:
- Boiler PG Test, as per ASME PTC 4.0 2008.
- Feed Water Heaters PG Test as per ASME PTC 12.1 – 2000.
- Boiler Feedwater Pump as per ISO 5198:1987(E).
- Deaerator as per ASME PTC 12.3 – 2009.
- Coal Pulverizer PG Test as per ASME PTC 4.2.
- Turbine PG Test as per ASME PTC 6 – 2004.
- Condenser PG Test as per ASME 12.2 – 2010.
- Generator PG Test as per Part 1 – IEC 60034 – 1.
Edited from press release by Angharad Lock
On 18 April, Australian Pacific Coal Ltd announced in a press release that the company’s recently appointed Chief Executive Officer John Robinson has progressed in securing the outstanding funding necessary for completion of the company’s acquisition of the Dartbrook Joint Venture from the Anglo American Plc group. This included the necessary funding to buy Marubeni Coal Pty Ltd’s 16.67% interest should this be required.
The company indicated that cornerstone investor Trepang Services Pty Ltd had provided a non-binding indication that it intends to arrange for the provision of AQC’s outstanding funding requirements, which are subject to AQC and Trepang (or other parties) agreeing the commercial terms and conditions of the funding, formal transactions documents being entered and any required shareholder approvals being obtained.
In the company release, APC indicated that it would provide further information regarding its outstanding funding needs in due course.
On 27 April, APC announced that it has secured the funding necessary to purchase Marubeni Coal’s 16.67% interest in the Dartbrook Joint Venture should this be required.
Trepang has provided the necessary purchase consideration of AUS$5 million by way of a secured, interest bearing, loan to the company for this purpose.
The loan has a three-year term and an interest rate of 10% per annum. The provision of the Loan is subject to the execution of a general security deed over all property of the company and the receipt of all required waivers to the grant of the security as required by the ASX Listing Rules.
Having considered all other financing alternatives for the procurement of this funding, the company considers that this loan is in the best interests of AQC and all of its shareholders. The company will forthwith seek an ASX waiver for the security to be granted in respect of the loan under Listing Rule 10.1.
The company will provide further information regarding its outstanding funding needs in due course.
Edited from press release by Harleigh Hobbs
Tahmima Anam
In Dhaka, we are used to the phenomenon called load-shedding. It’s when you’re sitting under the ceiling fan on a particularly hot day, the soles of your feet burning, hoping the evening will bring rain, or at the very least, a slight breeze … and suddenly the world goes quiet, the lights go out, and the fan’s revolutions slow, then stop.
We look at our watches. Load-shedding, we say to one another, hoping that this instance of it will follow the usual pattern, and that the electricity will come on in exactly an hour. Any longer and we worry the food in the fridge will spoil, or that we’ll miss the end of the -India cricket match on television.
But this year, despite a scorching spring, the hum of electricity has remained constant in Dhaka. There has been no load-shedding. The Eid meat is safe in the freezer. People watched the entire cricket World Cup without a hitch. So what has changed?
Power, of course. This government has done a heroic job of increasing the power output to match demand in a country where industrial and household consumption is running at breakneck speed.
Bangladesh this year — that’s an increase of 800 megawatts from last year, and a stunning 4,800 megawatts more than was produced in 2009, the year after the current government was voted in. Our homes, at least in the capital city, enjoy uninterrupted power.
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And the government’s ambitions are sky-high. In 2012, according to World Bank figures, roughly 40 percent of the population was still without electricity. The Energy Ministry claims that, over the next decade, all those households will be connected to the national grid, and by 2022, a series of new power plants the country’s capacity.
How will we find the resources for such aspirations?
Bangladesh depends on natural gas for much of its energy needs. But with domestic reserves being rapidly , and energy demand rising, other solutions must be found.
When this government came to power, it building at least 24 new coal-fired power plants throughout the country with a combination of private and public initiatives. However, by the start of this year, few of these plants had made much progress. Of the planned sites, only a handful as intended; in more than a dozen cases, construction has either or has failed to begin at all.
Political opposition to the projects is also growing. Last month, the prospect of coal-fired plants in Rampal and Banshkhali, in southern Bangladesh, . On April 4, four people protesting the Banshkhali plant . The activists, mainly local salt harvesters and shrimp farmers, were demonstrating against the plant’s threat to their livelihoods and the takeover of their land.
The Banshkhali plant, a joint venture between Bangladeshi and Chinese companies, has begun construction without securing site permits or carrying out an environmental impact assessment. Yet when faced with public agitation, the authorities have sided with the plant’s owners, accusing protesters of being “strange” and ignorant, and citing the government’s commitment to supplying the power-hungry nation as paramount.
In the meantime, the Rampal plant, which is within 10 miles of the ecologically sensitive Sundarbans mangrove forest and will use its narrow waterways to import coal from neighboring India, has been on environmentalists’ radar since it broke ground several years ago. The original joint venture with the Norwegian government because of environmental concerns; the plant now under construction is in part by a state-run power company from India.
Although the government has repeatedly assured the public that new technology means the coal plants will not harm the environment, a coal-laden ship in the Sundarbans, the third such incident in two years — leading campaigners to question the wisdom of building a coal-fired power plant so close to one of the country’s most precious natural habitats.
Last week, Bangladesh was among the 175 countries that the Paris climate agreement, and while it continues to have one of the lowest per capita rates of emissions, building coal-fired power plants will send the wrong message to the rest of the world. With India and China both under fire for their profligate use of coal, Bangladesh has an opportunity to act as one of the region’s more forward-thinking nations on energy planning.
Nuclear power has been proposed as an alternative source for Bangladesh’s energy needs, but the Ruppur power plant, a joint venture with Russia, has since the agreement . Undertaken with only the most cursory public consultation, the project will be hugely costly to start with, and is very likely to run over budget. There are also serious concerns as to whether Bangladesh can meet the stringent safety requirements for a nuclear plant.
In the meantime, a small solar-powered revolution is happening quietly in the background. Last year, the government announced that it the world’s “first solar nation.” In partnership with the World Bank, it has fitted 15 million households with , and plans to set up six million more by 2017. The program is extremely popular: High demand it the fastest-growing domestic solar-power project anywhere, with 40,000 to 50,000 new installations every month.
Solar still only a fraction (about 200 megawatts) of the total power supply. But the impact on rural households is profound, with ripple effects from education to agriculture and health care. Solar panels installed on houses mean not only a zero-emissions solution for rural electrification, but also homesteads no longer relying on the national grid for their domestic needs. A solar-powered home will never suffer from load-shedding.
Solar power, in its current form, cannot be the universal answer to Bangladesh’s growing energy needs, but the program is an example of a renewable, environmentally sensitive project that has clear popular consent. There’s a lesson in that for the government: Instead of riding roughshod over its citizens, refusing consultation and shooting down protesters, the authorities have to include the public in their planning decisions for the country’s future energy needs.
Alliance Resource Partners L.P. has reported financial and operating results for 1Q16. Net income was US$47.3 million, or US$0.36 per basic and diluted limited partner unit. Total revenues were US$412.8 million in the 2016 Quarter compared to US$560.4 million in the 2015 Quarter, primarily resulting from planned reductions in coal sales and production volumes and lower other sales and operating revenues following our acquisition of the remaining equity interests in White Oak Resources LLC (White Oak) in July 2015. Lower revenues were offset in part by reduced operating expenses and equity in loss of affiliates related to White Oak and led to EBITDA of US$135.8 million for the 2016 Quarter, compared to US$192.2 million for the 2015 Quarter.
ARLP also announced that the Board of Directors of its managing general partner has decreased the quarterly cash distribution to unitholders for the 2016 Quarter to US$0.4375 per unit (an annualised rate of US$1.75 per unit), payable on 13 May 2016 to all unitholders of record as of the close of trading on 6 May 2016.
“ARLP’s operating and financial performance for the 2016 Quarter was in line with our expectations as our results remained solid in the face of an extremely challenging coal market,” said Joseph W. Craft III, President and Chief Executive Officer. “Although ARLP’s performance continues to lead the industry and our balance sheet remains strong, we are unfortunately being impacted by the contagion caused by the financial struggles facing many of our competitors. In the current capital market environment, it has become clear that we must be proactive in preserving liquidity in order to maintain access to capital. The decision by our Board to reduce ARLP’s unitholder distribution, while difficult, is a significant step toward maintaining that access.”
Mr. Craft continued: “ARLP’s guidance for 2016 distributable cash flow has not changed from our year-end earnings release. For unitholders, this new distribution level provides stability as it meaningfully improves ARLP’s coverage to nearly 2.0x for the remaining three quarters of 2016 and an estimated 1.6x at the midpoint of current guidance for the 2016 calendar year. In the near term, we intend to use our excess cash flow to reduce indebtedness and further strengthen our balance sheet. Longer term, we are focused on growing our cash flows and returning to our past practice of steadily increasing distributions to our unitholders.”
Coal sales revenues in the 2016 Quarter were US$401.3 million as compared to US$517.7 million for the 2015 Quarter primarily as a result of lower coal sales and production volumes due to idling our Onton and Gibson North mines in the Sequential Quarter, the planned depletion of reserves at our Elk Creek mine in the 2016 Quarter and reduced production at our River View, Pattiki, Warrior, Tunnel Ridge and MC Mining operations. Compared to the 2015 Quarter, these reductions were partially offset by volumes from the Hamilton mine acquired as part of the White Oak Acquisition discussed above. ARLP’s coal sales revenue was also impacted by lower total average coal sales price realizations in the 2016 Quarter, which fell approximately 1.2% to $53.82 per ton sold compared to US$54.49 per ton sold for the 2015 Quarter.
Other sales and operating revenues were US$5.0 million in the 2016 Quarter compared to US$35.5 million for the 2015 Quarter due to the absence of coal royalty and surface facilities revenues from White Oak as discussed above and the receipt in the 2015 Quarter of certain customer payments in lieu of shipments related to an Appalachian coal sales contract.
Edited from press release by Angharad Lock
ITM Monitoring has successfully designed and installed monitoring systems for The Coal Authority to monitor five of its disused coal tip sites across South Wales, including Aberfan and Blaencwm. ITM’s approach to mine tip monitoring ensures access to quality data whilst reducing the time on site, and has a positive impact on helping to achieve both health and safety and environmental targets.
The monitoring systems installed are vital in alerting The Coal Authority’s engineers to any indication that change might be occurring and gives them better visibility of the factors that impact on the performance of their tip sites. In the case of the mine tips, the systems are designed to monitor factors including rainfall, wind speed and direction, water levels and flow in drainage features and to raise alarms when parameters are breached.
The data collected by the automated systems are analysed by the Coal Authority’s engineers through ITM’s data visualisation portal, Calyx OMS, to understand the relationship of the data to one another and therefore the identification of any potential issues. In addition to sensors providing continuous information, the system can also be supported by onsite cameras, which enable remote visual inspection of specific areas of interest, images from which can be vital in providing a second check when an alarm is raised.
Nick Slater, Head of Asset Monitoring, ITM Monitoring said: “We have had a long standing relationship with this key government organisation, having first worked with them in 2004, creating and installing the monitoring system for a landslide site in Wales. Our contract-winning approach was to create bespoke systems, which enable sensors to monitor the critical factors that affect the stability of the mine tips. The data is collected continuously and then visualised remotely through a centralised portal.”
Having successfully completed the monitoring system installs across the five sites, The Coal Authority is considering monitoring other sites in a similar way.
With their existing use of Calyx, visualising data from further sites will be easily accommodated and will allow for even greater comparison of data gathered through remote monitoring. Whilst it is difficult to beat a visual inspection from an experienced engineer, this complementary approach provides continuous data enabling with automated alarm notifications following changes of state. In addition to sensors providing continuous information, the system can also be supported by onsite cameras, which enable remote visual inspection of specific areas of interest, images from which can be vital in providing a second check when an alarm is raised and in proving confidence in the automated system is not misguided.
Edited from press release by Harleigh Hobbs
Global mining company Anglo American has reported its production report for the first quarter ended 31 March 2016 (1Q16).
At its Australian operations, export metallurgical coal production decreased by 9% to 4.5 million t. The company indicated that this was a result of planned longwall moves in the quarter at both Moranbah and Grasstree, partially offset by strong operational performance at Capcoal opencast mine, as well as the delivery of development coal from Grosvenor. In 1Q15 Dawson was impacted by a maintenance shutdown at the coal preparation plant.
Australian export thermal coal production decreased by 26% to 1.1 million t due to expected lower production from Drayton as it goes through a phased closure following the rejection of the Drayton South project by the New South Wales government.
On 20 January 2016, the agreement to sell the Callide thermal coal mine to Batchfire Resources was announced and remains subject to a number of conditions.
On 4 April 2016, the sale of Foxleigh opencast mine in Australia to Taurus Funds Management was announced. The sale is subject to conditions.
The mining giant’s South African export thermal coal production also saw declines, decreasing by 8% to 4 million t. This is reported to be driven in part by mix at Landau (producing more domestic coal, which, at current prices, results in a higher margin).
Anglo American indicated that Goedehoop production was impacted by unfavourable geology and Greenside experienced some temporary power outage issues.
Eskom production decreased by 8% to 6.4 million t due to a planned longwall move at New Denmark and planned production reductions at Kriel.
In Colombia, Cerrejón’s production decreased by 12% to 2.6 million t, due to planned production cuts to take out the highest cost capacity in response to market conditions.
Full year guidance
Anglo’s full year production guidance remains unchanged at 21 – 22 million t for export metallurgical coal and 28 – 30 million t for export thermal coal from South Africa and Colombia.
Edited from press release by Harleigh Hobbs
Edenville Energy plc has reported the resignation of Sally Schofield, Non-Executive Chairman of the company.
Sally is to resign for personal reasons. Sally’s contract provides for one month’s notice during which time she will be ensuring an orderly transfer of responsibilities to the company’s CEO Rufus Short who will assume the responsibilities of Chairman whilst options for the appointment of a new permanent Chairman are considered.
Sally has been with the company since its formation in March 2010 when the Rukwa deposit was largely unexplored. She has given significant guidance and strong support throughout this time, first as a Non-Executive Director and later as full time Executive Chairman before moving to Non-Executive Chairman in June 2015.
Sally leaves the company in a strong position.
Edited from press release by Angharad Lock
TNB Fuel Services Sdn. Bhd. has signed 5 long-term Contracts of Affreightment (COA), valued approximately at US$537 million or RM2.3 billion for the shipment of coal from Indonesia.
The contract, 10 yrs and 15 yrs are with the following Malaysian shipping companies:
- PNSL Berhad, Consecutive Voyage Charter (“CVC”) secondhand with a vessel size of 70 000 t +/-10%, for 1.5 million tpy with an estimated contract value of about US$99 million for a 10 yr period.
- Prima Shipping Sdn. Bhd., CVC secondhand with a vessel size of 70 000 t +/-10%, for 1.5 million tpy with an estimated contract value of US$99 million for a 10 yr period.
- Duta Marine Sdn. Bhd., CVC secondhand with a vessel size of 70 000 t +/-10%, for 1.5 million tpy with an estimated contract value of US$100.5 million for a 10 yr period.
- Malaysian Bulk Carriers Berhad, CVC newbuilding with a vessel size of 80 000 t +/-10%, for 1.5 million tpy with an estimated contract value of US$143.1 million for a 15-year period.
- PNSL Berhad, CVC secondhand with a vessel size of 80 000 t +/-10%, for 1.5 Mtpa with an estimated contract value of US$95.4 million for a 10-yr period.
The awarding of the long-term COA reflects TNBF’s commitment in promoting and nurturing the growth of Malaysian owned shipping companies which eventually will allow them to own and/or operate Malaysian flagged vessels. Simultaneously, the long-term COA allows TNBF to diversify its freight contracts’ portfolio to 60% term COA, 20% spot contract and 20% long-term COA, subject to market condition.
As the Long Term COA commences, the total allocated 7.5 million tpy is actually less than 30% of the total shipping services required by TNBF in 2016 i.e. 27 million tpy. By 2019 when the coal requirement is anticipated to be around 40 million tpy, the Long Term COA will contribute to about 18.75% of the total shipping services.
The long-term COA is planned for shipments of coal from Indonesia since almost 60% of the coal procured by TNBF is from this country to the three (3) discharge ports namely Lekir Bulk Terminal (Manjung), Jimah Power Plant (Jimah) and Tanjung Bin Power Plant (Tg.Bin).
TNBF is the nominated coal and fuel supplier to TNB and Independent Power Producers having Power Purchase Agreements with TNB.
Edited from press release by Angharad Lock
Allison Transmission Holdings Inc. has reported net sales for 1Q16 of US$462 million, an 8% decrease from the same period in 2015.
The decrease in net sales was principally driven by lower demand in the global Off-Highway and Service Parts, Support Equipment & Other end markets.
Adjusted Net Income, a non-GAAP financial measure, for the quarter was US$109 million, a decrease of US$41 million. Adjusted EBITDA, a non-GAAP financial measure, for the quarter was US$162 million, or 35.1% of net sales, compared to US$190 million, for the same period in 2015. Adjusted Free Cash Flow, a non-GAAP financial measure, for the quarter was US$113 million, or US$0.66 per diluted share.
Lawrence E. Dewey, Chairman and Chief Executive Officer of Allison Transmission, commented: “Allison’s first quarter 2016 results are within the full year guidance ranges we provided to the market on February 8. The year-over-year reductions in the global Off-Highway and Service Parts, Support Equipment & Other end markets net sales are consistent with the previously contemplated impact of low energy and commodity prices. Allison demonstrated solid operating margins and free cash flow while executing its prudent and well-defined approach to capital structure and allocation. During the first quarter, we settled US$33 million of share repurchases, paid a dividend of US$0.15 per share and repaid $6 million of debt. We anticipate no meaningful relief from the global Off-Highway end market challenges and are affirming our full year net sales guidance of a decrease in the range of 6.5 to 9.5%.”
Highlights
North America On-Highway end market net sales were down 4%, driven by lower demand for Rugged Duty Series models and up 2% on a sequential basis principally driven by higher demand for Pupil Transport/Shuttle Series models.
North America Hybrid-Propulsion Systems for Transit Bus end market net sales were down 6% and down 26% sequentially.
North America Off-Highway end market net sales were down 77% from the same period in 2015 and down 55% on a sequential basis principally driven by lower demand from hydraulic fracturing applications.
Defense end market net sales were flat with the same period in 2015 and flat sequentially, principally driven by higher demand for Wheeled Defense offset by lower demand for Tracked Defense.
Outside North America On-Highway end market net sales were up 23% from the same period in 2015 principally driven by higher demand in Europe and Japan and up 8% on a sequential basis principally driven by higher demand in Japan.
Outside North America Off-Highway end market net sales were down 81% and down 57% sequentially.
Service Parts, Support Equipment & Other end market net sales were down 13%.
Gross profit for the quarter was US$215 million, a decrease of 10% from US$239 million for the same period in 2015. Gross margin for the quarter was 46.5%, a decrease of 100 basis points from a gross margin of 47.5% for the same period in 2015.
Selling, general and administrative expenses for the quarter were US$83 million.
LOESCHE GmbH has been successfully recertified according to ISO 9001.
The Düsseldorf-based company develops and produces machine and plant technology, which are used in grinding plants and combined drying and grinding plants for the cement, steel, power plants, mineral processing and chemical industries.
With the renewed certificate from LRQA Business Assurance in 2015, LOESCHE is certified that the revised quality management of the company also meets the requirements of ISO 9001:2008. ISO 9001 is the most widespread and most important standard and basis for national and international businesses.
LOESCHE GmbH was already certified for the first time in 1998. The company has indicated that quality management is an integral component of the company’s principles: processes and services are constantly adapted to the new requirements of the globally active company.
“A functioning quality management is indispensable. Our customers expect innovative engineering, precise plant construction and reliable service. We can only render these services if we adhere to the processes within the LOESCHE Group in accordance with our specifications. The certificate proves that we also live by the interdisciplinary and intradisciplinary processes”, explained Angelika Wollenweber, Head of Quality Management, Standards & Regulations.
The subsidiaries are certified separately by different certification companies. LOESCHE (Shanghai) Co. Ltd. has been certified since 2014. In addition to LOESCHE GmbH, the subsidiaries in India and America were recertified according to ISO 9001:2008 last year. LOESCHE Automatisierungstechnik GmbH was additionally certified according to OHSAS.
Edited from press release by Harleigh Hobbs