Coal quality data indicated a potential low volatile PCI product similar to that produced by Yarrabee and Jellinbah mines located west of Dingo West, the company said.
“The Dingo West coal project is expected to produce 1 million tonnes per annum of high quality, low volatile PCI coal for the export market,” Bandanna said in its December quarterly report.
“The scale of the proposed Dingo West project means that the company is confident of securing sufficient port capacity in Gladstone to enable exports prior to the completion of WICET [Wiggins Island coal export terminal].”
The Dingo West project is located west of the township of Dingo and the main Blackwaterâ€Gladstone rail line, while Capricorn Highway traverses the northern part of the lease.
The rail distance to the port of Gladstone is 200km.
“Strategically, a mine at Dingo West would be approximately 60km closer to this port facility than any existing operating mine situated along the Blackwater corridor,” Bandanna said.
Bandanna completed the definitive feasibility study for its Springsure Creek project which confirmed an estimated $743 million capital cost for development of stage 1 of the single longwall project to produce 5.5Mtpa.
Stage 2 – the establishment of a second longwall and supporting infrastructure to produce a combined total of 11Mtpa – is expected to have an additional cost of $437 million.
Average free-on-board operating cash costs (excluding Queensland government royalties) for the project are estimated at $65.60 a tonne, following completion of both stages of the project.
The DFS concluded that the project provided very positive economic benefits within an estimated net present value range from $700 million to $1.1 billion, depending on various coal price and foreign exchange scenarios.
