11 July 2014
NEWSTAN MOVES TO CARE AND MAINTENANCE
Like other companies in the Australian (and global) mining sector, Centennial Coal (Centennial) has continued to review its business operations in response to changing market conditions. The high A$/US$ exchange rate and low export prices continue to impact the Australian Black Coal Industry. Over the past two years, in response to the prevailing economics affecting the coal industry generally, Centennial has focused on reducing costs and increasing productivity across the Group.
Unfortunately, it has become necessary for Centennial to place its Newstan Mine (Newstan), located in Western Lake Macquarie, back into ‘care and maintenance’ from August. Newstan recommenced operation in 2011 in response to the then strong export market.
“This decision has not been taken lightly, and is essential if Centennial is to sustain its competitiveness and market position. In the current market Newstan’s losses can no longer be absorbed”, explained David Moult, Centennial Coal’s CEO and Managing Director.
“Therefore, following consultation with the Newstan workforce, a decision has been made to place Newstan back into ‘care and maintenance’ from August 2014”, said Mr Moult.
Newstan currently employs 148 people. It is expected that approximately 45 members of the existing Newstan workforce will be redeployed to Centennial’s Myuna Mine, resulting in the retrenchment of the remaining Newstan employees.
“This has been an extremely difficult decision. Centennial is committed to diligently working through a process that will sensitively support those impacted”, Mr Moult concluded.
Centennial will continue to progress both the Northern Coal Services and Newstan Extension Projects in anticipation of improved market conditions in the future. Securing new approvals for both Projects will secure the significant coal resources at Newstan which are in close geographic proximity to local power stations and the Port of Newcastle, and will place Centennial in a position to recommence mining at Newstan when markets conditions improve.
While on ‘care & maintenance’, Newstan will continue to meet safety and environmental regulations and the site will be appropriately maintained to enable a reopening when market conditions improve.
Centennial Coal (Centennial) is a coal mining and marketing company supplying thermal coal to the domestic and export markets. Fuelling around 40% of NSW’s coal-fired electricity generating capacity, Centennial is a wholly owned subsidiary of Banpu Public Company Limited (Banpu) and, as part of Banpu, a member of the largest independent pan-Asian coal group.
Centennial has over 1,700 employees and six operating coal mines in NSW, making it one of the largest underground coal producers in NSW.
There has been mining at Newstan for over 125 years. Located at Fassifern, in Western Lake Macquarie, Newstan is linked by dedicated haul road and rail to local power stations and is 25km south of the Port or Newcastle.
While under care and maintenance for a period of 3 years (2009 – 2011) previously, an extensive exploration drilling programme was undertaken as part of the Newstan Mine Extension Project – thereby providing the mine with the basis of a future re-opening when market conditions improve.
For further information contact:
Katie Brassil – General Manager External Affairs on 0419 356 690