Stage one production from the thermal coal mine, under construction in the New South Wales Gunnedah Basin, is expected to start in early 2010 with a target output of 700,000 tonnes per annum using continuous miners.

Having ordered Bucyrus longwall equipment, Whitehaven expects to install it in early 2011 for second-stage conventional longwall mining of a 4.2m bottom section of the 9m Hoskinsons seam to produce 6 million tonnes per annum.

The equipment can be retrofitted for LTCC mining to allow the option of extracting the full thickness of the seam.

At its annual general meeting, Whitehaven shed more light on its plans for North Narrabri.

The company is assessing the viability of LTCC mining, with the mine having capacity of up to 9.5Mtpa when its longwall is LTCC-fitted.

LTCC mining would have the potential to increase resource recovery by about 300Mt and could substantially reduce development work with continuous miners.

Among the potential benefits, Whitehaven expects LTCC to reduce gas and spontaneous combustion management costs.

Whitehaven said more study and mining experience of the seam was required before it could commit to a decision on LTCC.

The main issue at this stage is that the top section of the Hoskinsons seam contains higher ash, which will need more coal processing.

The company expects the earliest LTCC could start would be around late 2012, during a change from longwall block 2 to block 3.

Whitehaven is also looking into the PCI opportunities for North Narrabri following recent coal quality and washability analysis.

The addition of a dense-medium cyclone to the jig plant under stage two development has Whitehaven anticipating that 45% of the run-of-mine coal could be produced into about a 7.5% ash PCI coal product, while 55% of the ROM coal would be turned into 11% ash thermal coal.

If LTCC mining does go ahead, a two-stage DMC and spirals plant could potentially produce up to 35% PCI coal with a 7.5% ash content, and could yield 50% of the ROM coal into thermal coal of about 13.5% ash.

Whitehaven said further work was being done to verify these processing results and to estimate capital and operating costs of the new processing plant options.

As for development work for the mine, the surface facilities should be completed by year-end apart from the clean coal reclaim tunnel, which is due for commissioning in February.

The ongoing work on the three 1100m drift tunnels, also expected to be completed in February, has recently lost some pace.

“Drift drivage is now progressing through very soft material which has slowed development rates and is likely to delay first coal production by some weeks,” the company said.

In its outlook for 2010, Whitehaven expects to have its four open cut mines ramping up to about 5.5Mtpa of total production, with the Canyon mine having recently been closed and under rehabilitation.

By the 2013-14 financial year, Whitehaven expects up to 11.5Mtpa of total production capacity, without factoring in LTCC mining.

Newcastle and rail update

As an 11% member of the Newcastle Coal Infrastructure Group consortium, Whitehaven updated its shareholders on development of NCIG’s new export terminal and the Hunter Coal plan, which also involves port operator Port Waratah Coal Services.

First Narrabri coal will go through the new terminal, which is expected to be operating by the end of the March quarter.

Whitehaven is expecting to receive 3.3Mtpa of throughput capacity from this stage one 30Mtpa NCIG terminal at Newcastle’s port and another 2.7Mtpa under the stage two expansion.

The Hunter Coal plan, a legal framework agreed to by all Hunter Valley coal producers, government and the port operators to better manage coal exports through Newcastle, has Whitehaven onboard for 3.6Mtpa of throughput capacity from PWCS.

Combining NCIG stage one and two along with the PWCS capacity for the company, Whitehaven is in the clear for 9.6Mtpa of exports.

On rail investment with its partner Idemitsu and the Australian Rail Track Corporation, Whitehaven said the current track could handle six or seven train paths to Narrabri per day and 5400-tonne trains allowed for 10-12Mtpa of rail haulage capacity, sufficient for its needs.

Beyond 2012, ARTC plans to further increase the rail capacity to about 16Mtpa.

Shares in Whitehaven closed up 3.03% to $4.42 yesterday.