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Narrabri commissioning challenges may impact Whitehaven valuation

PROBLEMS recruiting experienced underground staff and concerns by analysts about goaf issues duri...

Lou Caruana
Narrabri commissioning challenges may impact Whitehaven valuation

The issues also may have made the company’s share price susceptible to shortselling in the lead-up to Nathan Tinkler’s $5.20 per share bid for the company on Friday.

While Narrabri was hailed a significant milestone by the company, broking house Macquarie pointed to problems with the roof of the longwall going forward that could lead to windblasts in the mine.

“The installation of the longwall is a significant milestone in the development of the project,” Macquarie said.

“The longwall construction required 10,000 tonnes of equipment to be transported underground and assembled.”

With commissioning underway, attention shifts to the behaviour of the goaf roof as the longwall advances, according to Macquarie.

“There is potential for the goaf to ‘hangup’ and create a hazardous windblast environment due to the properties of the strata above the coal seam,” it said.

“Whitehaven has hydrofracced sections of the strata above the first longwall panel to aid the roof collapse in the goaf.

“The company will monitor the roof’s behaviour to determine the extent of hydrofraccing required, if any.”

A three-month commissioning and ramp-up program is underway to bring the longwall to full production.

The longwall is engineered and scheduled to produce approximately 6 million tonnes per annum of raw coal.

In a statement last month, Whitehaven managing director Tony Haggarty said the installation of 10,000 tonnes of equipment with installed power of 7 megawatts and the commencement of longwall commissioning completed the construction and development phase of the project.

In April Haggarty said Narrabri continued to experience difficulty in recruiting sufficient experienced underground miners and contractors to fully utilise its four development mining units.

Given its location in the Gunnedah Basin, Narrabri does not have the ready pool of labour in more established coal mining regions such as the Hunter Valley or Bowen Basin.

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