Dendrobium will have the capacity to produce 5.2 million tonnes of raw coal per annum. Capital expenditure is estimated at US$126 million.

In a company announcement, BHPB said development would commence immediately with first longwall production expected by early 2005.

BHP Billiton president Carbon Steel Materials Bob Kirkby said: "Dendrobium will provide our domestic steel customers with a reliable and cost-effective supply of coking coal, and will be blended with coals from BHP Billiton's other Illawarra Coal operations to provide a premium product for international customers."

The company said the BHP Billiton Board approval followed an examination of the recommendations of the recent Commission of Inquiry, which cleared the way for construction subject to a range of stringent conditions imposed by the New South Wales Government.

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