Other highlights of the quarter included a 9% lift in the company’s equity share of ROM production to 6.4 million tonnes, as well as a $615 million debt restructuring, which could save it up to $6 million per annum.

The lower first half was affected by a number of one-off factors, said managing director Bob Cameron, including $5.6 million for problems related to the Angus Place longwall. These problems had been overcome, with the mine now realising 2.8 million tones per annum as it mines the longer southern blocks.

Thanks to coal shortages, power generators exercised buyers’ options Centennial was unable to meet, forcing it to purchase 185,000t of coal from other producers. Cameron said this situation would not arise again as Centennial had renegotiated the clause.

“However, with all four longwall mines now fully operational, including the recently commissioned Mandalong longwall, the second half result will dwarf that of the first half as the company benefits from its growing production levels and its rising export price profile,” he said.

The Mandalong longwall mine in New South Wales started production January 24, on time and on-budget, and is ramping-up to around 3.5Mtpa by the end of 2005.

“Mandalong is a new mine, utilising new and proven technology, including one of the most advanced longwalls in the world. It has got off to a good start and represents an excellent achievement by all those involved with the development of this first class mine,” Cameron said.

The neighbouring Springvale Mine has just moved to a wider panel of 305m, up from 250m. In early 2006 Springvale will move to longer 4km blocks, delivering an additional 500,000t of coal with no additional employees.

At Newstan, investment in upgrading the mine and its export facilities is underway, with Newstan expected to produce up to 500,000t of semi-soft coal in calendar 2005. Semi-soft coal prices have been settled at prices some 50% higher than last year.

Production at the Clarence and Charbon bord and pillar operations steadily increased in 2004 as the mines expanded their export capacities. Further improvements are expected from Clarence following the successful commissioning of an additional continuous miner and shuttle-cars. Both mines export through the underutilised Port Kembla Coal Terminal, near Wollongong, and will not suffer from export infrastructure constraints.

The company continues to progress the Anvil Hill opencut project, with the NSW Government granting an Assessment Lease as a precursor to an application for a Mining Lease towards the end of 2005.

Centennial also completed a full review of its resource base with total resources now reaching 3Bt of coal. All major operations have mine lives in excess of 20 years.

“Given the exciting outlook for the second half, and the 2006 financial year, which will benefit from a full year’s longwall production from Mandalong, the directors have maintained an interim dividend of 6c per share (unfranked),” Cameron said.