Australian Pacific Coal asks NSW government for moratorium on permanent open-cut ban as it prepares to open underground mine from August 2023

Dartbrook's owner Australian Pacific Coal (AQC) told the stock exchange it had not heard back from the NSW government after asking for "a moratorium" on the government's decision to ban future open-cut mining at Dartbrook by amending the relevant State Environmental Planning Policy or SEPP.

It said the government's open-cut intentions had no impact on its approval to restart underground mining at the operation, which had been closed on a "care and maintenance basis" since 2007.

In a decision that has since survived a court challenge, Dartbrook secured a five-year extension of its mining consent, which will now expire on December 22, 2027, instead of next month as was previously the case.

IN THE NEWS:

As the Newcastle Herald has reported, the Dartbrook assets were at the heart of a funding and ownership struggle from September.

A series of stock exchange notices include details of a new joint venture that gives AQC 50 per cent, mine operator Tetra Resources and M Resources 20 per cent each and long-term investor Trepang Services 10 per cent.

A capital raising recently completed what AQC called "a $100 million recapitalisation of its balance sheet which provides a pathway for the restart of mining at the Dartbrook project".

On November 8, AQC said the project team "continues to collaborate with financiers, potential (coal) offtake partners and operational personnel to fast track the immediate 1.5 million tonnes per annum operation, and progress towards the nameplate capacity of 6.0 million tonnes per annum."

Capital expenditure for the project was put at $100 milllion to $120 million.

AQC said a new mining strategy based on leasing equipment rather than buying it new would reduce the overall cost by about $80 million and speed up the time taken to become operational, given that "new equipment lead times are greater than 18 months".

The November 8 statement said pre-production works were likely to take seven to nine months. Major parts of the restart operation included "dewatering" of the underground "Hunter Tunnel" - which connects the mine workings to the coal handling and preparation plant - as well restoration and noise-reduction works on the coal plant.

AQC said operating costs were likely to be line with a conventional bord-and-pillar operation of $85 to $90 a tonne.

It said Dartbrook would produce a "NEWC" (Newcastle, 6000kilocalore) specification coal, which was trading at a $US180 a tonne premium to "API 5" (or 5500kilocalorie coal).

Last week's Australian Coal Report showed 6000kc Newcastle coal at $US310 a tonne and 5500kc at $137 a tonne.

The same 6000kc index peaked in September at $US457 a tonne but prices are expected to remain elevated with wet weather hampering coal production.

Our journalists work hard to provide local, up-to-date news to the community. This is how you can continue to access our trusted content: