Bandanna is the only listed company involved in a major project in the unexploited Galilee Basin.
This is likely to remain the case for quite some time, as Linc Energy recently inked a deal to sell its Galilee tenement to India’s Adani Group for $500 million cash and expected future royalties of $3 billion over 20 years of mining.
The South Galilee project aims to develop a 15-20 million tonne per annum thermal coal mine with a life of at least 40 years and first exports in 2014-15.
The operational workforce is expected to reach 750, with accommodation to be built to meet fly-in, fly-out requirements.
Construction is expected to employ 1500, with infrastructure including a coal-handling and processing plant, a water pipeline and electricity transmission lines.
A rail spur will also be built to hook up to proposed common-user railway and port services from other Galilee players Hancock Coal and Waratah Coal plus state government-owned North Queensland Bulk Ports Corporation, according to Queensland’s Coordinator-General.
In July, the government body gave a preliminary “infrastructure facility of significance” approval for Hancock’s $2 billion rail corridor to link to Abbot Point.
But environmental approvals are still required for the coal chain plans of Hancock, Waratah and NQBPC.
Mining at the South Galilee project will target five main coal seams which range from 2 metres to 5m thickness.
The initial open cut methods still need to be fully determined through further mine planning, but options include truck and shovel, shovel and conveyor and dragline operations.
“Underground mining is likely to be via punch longwall mining off the opencut highwalls and may include multiple longwalls,” Queensland’s Coordinator-General said in the draft terms of reference (TOR).
The JV must consider the longwall impacts to listed protected species and communities and must detail the longwall design, including strip pillar mining, in its environmental impact statement.
“The South Galilee project joint venture is committed to community engagement and will continue pursuing comprehensive stakeholder consultation, gathering input and feedback as the project develops,” Bandanna managing director Ray Shaw said.
Public comment and feedback on the draft TOR is possible through Queensland’s Department of Infrastructure and Planning website until September 13.
In the meantime, the JV has an $8 million prefeasibility study for the project underway, which includes more than 140 holes of drilling.
The project hosts 982 million tonnes of thermal coal resources, including 922Mt inferred and 60Mt indicated.
Last year, Shaw discussed concept plans for phase one development to cover five open pits of 3km in length.
He said longwall mining could take 23 years using two longwalls aiming for 5Mtpa.
Private resources company AMCI can earn up to half of the South Galilee project by funding exploration and development to the tune of $25 million.
Waratah – owned by magnate Clive Palmer – is targeting 40Mtpa of thermal coal from its China First project in the region, with resources upgraded to 7.4 billion tonnes in February.
Hancock is owned by iron ore heiress Gina Rinehart and is planning the $15 billion Alpha and Kevin’s Corner coal mines and associated 500km rail corridor to create the biggest thermal coal mine complex in the country.
These operations are aiming for 60Mtpa at full production for a mine life of 30 years.
Bandanna shares are up 6% to 88c this morning.
