Production and sales performances were off Centennial budget targets for the March quarter, recording 2.6 million tonnes in production and 2.4 million tonnes of coal sales.

Centennial said the below par performance was primarily due to setbacks with Angus Place where clearance system problems have caused additional cost and lost production, which will have a negative impact on the company’s full year financial performance.

Longwall production after relocation was originally slated for completion in early March, with capacity of product handling increasing from 1.500 tonnes per hour to 2,500 tonnes per hour with increased belt reliability. However operating capacity has been reduced to 50% below budget because of design issues with the upgraded conveyor system.

The project also incorporated a series of “soft start” belt conveyor drives, the electrical components of which Centennial said were yet to meet design capacity.

“Encouragingly, increased reliability has been achieved in recent weeks, with conveyor belt availability improving from 60% in March to 85% in April. Utilisation of design capacity has improved from 33% to 66% over the same period. This has provided management with confidence that the system is on track to reach its design capability,” Centennial said in its quarterly activities report.

“Currently the mine is achieving its pre-grade daily budgeted production rates and work continues to lift production performance to the higher designed capacity levels underpinning the investment decision.

“The mine is now set up for the long-term to achieve higher levels of performance than previously attained.”

Springvale longwall continued to perform well during the quarter with longwall face relocation ahead of budget and development performance continuing to meet budgetary expectations in preparation for the move to wider block in the December 2004 quarter and longer clocks in March 2006 quarter.

New production equipment made a positive impact at Newstan and set the operation up for a strong final quarter. The mine previously experience a roof fall in late December, recovering in mid-January and production was affected for a further three weeks as the longwall worked its way through difficult ground conditions.

At the Mandalong development, production fell behind budget but Centennial believe it remains on track for commencement in January 2005. The excavation of the decline will be completed by mid-May.