ANNUAL%20REPORT%202015%20eng

Management Discussion and Analysis
Figure 1. The Group’s historical annual ROM coal production volumes (in thousand tonnes) and actual stripping
ratio (in bcm of overburden per ROM tonne of coal):
Following a successful, small scale geotechnical drilling exercise completed in the first half of 2015, the
subsequent analysis of results has proven the initial predictions intended to be evaluated, and has led to the
revision of the geotechnical recommendations regarding overall slope angle and distance required between
pit crest and ex-pit overburden dump to the north of the UHG pit. This has allowed for the ex-pit waste dump
location to be safely moved closer to the pit, with the resulting decrease to vertical and horizontal haulage
distances allowing for reduction in required truck hours, and hence haulage cost.
During the second half of 2015, negotiation with mining and blasting contractors has led to significant reductions
in the forecasted cost of services going forward in respective contract extension periods. The contract revisions
became effective in late 2015, during a period of reduced mining activity, and thus the positive impact resulting
from these contract revisions on overall unit cost per bcm of material mined will be more pronounced from 2016
onward.
Coal Processing
In response to the reduced market demand and lower mine production output, the volume of ROM coal processed
was also reduced, with total CHPP feed of 2.6 Mt in 2015 achieved, including 49 kt from third parties under fee
for service arrangements. From the feed of ROM coal owned by the Group, a total of 1.3 Mt of HCC primary
product and 0.7 Mt of secondary by-product washed thermal coal (“middlings”) were produced at yields of
50.9% and 26.9% respectively. Figure 2 displays the historical annual washed production volumes of the Group.
Production trials that had commenced in the first half of 2015 with regard to inclusion of Seam 0B in the ROM
feed blend to CHPP when producing HCC were expanded in the second half of 2015 with continued positive
results. During the second half of 2015, on average the ROM feed blend to CHPP comprised 29.0% of Seam 0B,
whilst meeting customer product specifications and achieving 51.7% primary and 21.1% secondary yields.
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Annual Report 2015