Surface facilities are complete and the first train of export coal is scheduled for late July, the company said in a statement.
Whitehaven has hosed down speculation that it is seeking a capital raising and warned that recent price increases in coal sale contracts would not be reflected in the current quarter.
The company intends to fund its investment plans through the previous sales of joint venture shares in its Narrabri project.
“During the next 12 months, Whitehaven expects to receive outstanding proceeds of approximately $200 million from the previous sales of Narrabri joint venture proceeds,” the company said.
“As previously announced, these funds, together with operating cash flow and equipment leasing finance, are expected to be more than adequate to fund Whitehaven’s current investment plans.”
Production at Narrabri is expected to start mid-year, targeting 700,000 tonnes per annum of low-sulfur export thermal coal.
Stage two development will transform the mine into a 5.3 million tonne per annum longwall operation, with an environmental assessment underway.
“We do not have a definite day for first coal production as yet, but it will be in the next few weeks,” Whitehaven managing director Tony Haggarty said.
“Our underground employees are finalising their comprehensive training in preparation to operate the continuous mining equipment and support our ongoing underground development.
"The underground coal industry has very strict operating and safety requirements, and the safety of our people is paramount. There is a very extensive training process that must be followed and it is not possible to start an underground coal mine without first starting with experienced people.
“We are very pleased with the quality of people we have brought onboard and are continuing our recruiting drive to support the increasing production at the mine.”
The stage two mining plans cover 26 longwall blocks targeting the bottom section of the 4.25-10m thick Hoskissons seam.
Each panel will be 305m wide and extracted to an average height of 4.2m, while the face height will be 3.5m at the main gate and tail gate ends, matching the 3.5m-high gate entries.
Cover depths are expected to range between 160m and 180m over the eastern area of the minesite and extend up to 380m over the western ridge area.
The company aims to leave a single row of 3.5m-high chain pillars between the extracted longwall blocks, with widths of 24.6-37.6m at the larger depths.
The Narrabri longwall, which can be retrofitted for longwall top coal caving, was ordered from Bucyrus in September last year for delivery late this year. Installation will go ahead mid-2011.
Whitehaven’s new coal train comprising three locomotives and 86 wagons is being delivered this month. Commissioning and testing is expected to be completed in June with the full train (72 wagons) hauling export coal in July. Pacific National will operate the train under lease.
The commissioning and transition to full operations at the new Newcastle Coal Infrastructure Group port facility is progressing well.
“Whitehaven shipped its first Panamax cargo from NCIG in May and expects to ship two further cargoes in June. Whitehaven’s 11 per cent interest in NCIG is expected to provide new port capacity for Whitehaven of approximately 2.5 million tonnes in FY 2011,” the company said.
Recent upgrades to earnings forecasts in various broker research reports did not reflect Whitehaven’s expected results for the year ending June 30, 2010.
“As previously reported to shareholders, the majority of Whitehaven’s coal sales contract prices for FY 2010 are fixed,” the company said.
“The benefits of recent coal price rises will be realised in the year ending June 30, 2011 [FY 2011], rather than in the current quarter.”
Whitehaven expects its underlying net profit after tax for the 2010 financial year to be in the range of $50-55 million, subject to achieving planned rail and shipping performance in June.
Whitehaven shares are up 8c to $4.64 this morning.
