Speaking at the 5th annual McCloskey Coal Forecast Conference 2001, held in Brisbane from November 29-30, Nicholls addressed the subject of longwall productivity in Australia.

He argued that despite the fact that 34 Australian longwalls produced over 71 million ROM tonnes in 1999/2000, these results are relatively mediocre. According to Nicholls, an alternative argument may be made which shows poor utilisation of equipment during time available for production; higher production costs; and low return from invested capital.

In making assumptions about the industry at large and averaging out operating statistics, Nicholls extrapolated the following generalisations about Australia’s longwalls:

* Each longwall system has a production rate of 1,200 tonnes/hour.

* Each longwall is relocated once per year taking about 42 days.

* Each longwall works 5 days per week, 18 hours per day.

* Each longwall has a maintenance period of 6 hours per day, 5 days per week.

* Capital equipment is available for operating 363 days per year.

Using these figures, Nicholls suggested that potential capacity equates to 162Mt (as opposed to the 71Mt actual production) or 44% of potential production.

“What makes the picture even worse is the actual utilisation time (the time coal is actually being produced from the equipment) for the Australian longwalls. Using the above assumptions it is only 20% of total available time for capital equipment,” he said.

An increase of 10% across the board of longwall utilisation would equate to an extra 7.2 million raw tonnes on 1999/00 results or an increase in revenue of US$137.7 million (based on an average 75% yield, Queensland production 33.21Mt raw coal, New South Wales production 38.01Mt raw coal, average selling price US$25.50/tonne).

Nicholls suggested that one of the main problems is that longwall faces are not properly managed. The underlying reason is the system of face deputies who are required to fulfill statutory functions, in addition to the crucial role of overseeing a longwall.

“To effectively manage a business that can produce in excess of $500,000 per day in revenue needs an effective, strong and disciplined management team. Each shift should have a ‘face boss’ responsible for driving production through standards, procedures, urgency and detailed minute-by-minute preparation of activities.

"The shift operating crew must relate to this individual not, as has been the practice here in Australia (particularly Queensland), to the face deputy. We should not attempt to run a business as big as a longwall without an effective, fully-committed management team who are held accountable for the results.”

A further issue identified was the increasing sophistication of some equipment. At times some equipment is too sophisticated, with problems that even the suppliers’ engineers cannot fix.

“Referencing problems back to supplier’s designers in either Germany or UK or the US is not acceptable. Equipment service engineers and our own technicians must be sufficiently trained to deal with these highly sophisticated stop buttons,” Nicholls argued.

“One avenue available is the opportunity to establish an alliance between the mine (or mines) and the longwall equipment supplier. This must result in a more structured, positive and cost effective arrangement for dealing with the elimination of problems, increased running time and reduced maintenance and rebuild costs. The daily involvement of alliance partners can only lead to a greater commitment to increased utilisation and reduction in costs, particularly at rebuild and relocation times.”

Nicholls called for operators to stop “head butting” suppliers to continually get the lowest price for supply and rebuild of equipment: “The lowest cost today, for parts or a rebuild may not be the lowest overall long term cost for the longwall business unit.”

Regarding industrial issues, Nicholls believes that monetary incentives influence performance: “…almost all of the best longwalls in Queensland have attractive monetary incentives, those units producing the highest tonnages usually have the highest paid operators driving these faces.

“Keeping the longwall teams together, training them specifically for longwall operations and providing them with strong skilled leadership from the longwall management team, particularly ‘face bosses’, is the way to create an allegiance to the business unit. Once established, it is easier to improve attitudes and motivation of the crews. Most longwall miners prefer longwalling. Management should establish the teams, train them well, provide leadership and involve them in the operations. Longwall efficiencies will then improve.

“The outdated industrial attitude that all are equal and should be rewarded the same has had its day. The 5Mt per year longwall is too big a business to be driven on outdated industrial practices and supervisory requirements.”

Brian Nicholls was most recently general manager at the North Goonyella longwall mine in Queensland and is managing director of Brian Nicholls Mining.