Aquila announced in September it had completed the study, which proved the technical and financial feasibility of the Queensland development as a multi-seam, single or dual longwall mine producing up to 7 million tonnes per annum of predominantly hard coking coal.
Aquila has now moved to definitive feasibility study stage.
The study identified several mining scenarios for Eagle Downs including:
A single longwall mining all seams sequentially producing 4Mtpa over 90 years;
A single longwall mining all the seams bar one, producing 4Mtpa over 73 years;
Two longwall units mining all seams, producing 7Mtpa over 46 years; or
Two longwall units mining all seams bar one, producing 7Mtpa over 37 years.
At this stage Aquila has identified case 2 with the single longwall and three seams as the most attractive for the first stage of the development.
The company said this option would allow it to deliver the project sooner, take advantage of coking coal prices, and generate cash flow to expand to a dual longwall operation producing 7Mtpa. First sales are expected in 2012.
Aquila has flagged $892 million capex, made up of $60 million for pre-production engineering, $143 million for the longwall, $67 million for conveyors, $25 million for mine development equipment, $33 million for mine support equipment, $169 million for infrastructure, $294 million for coal handling and preparation, and $101 million for access and services.
The pre-feasibility estimated a single longwall operation would have an operating cost per tonne of $72.51.
The Eagle Downs resource is made up of 190Mt indicated and 590Mt inferred, which Aquila plans to upgrade early next year. 3D seismic work will begin this month.
In other news at Aquila’s coal projects, Isaac Plains produced its best quarter ever, with 463,000t produced during the September quarter. However, overburden removal is behind schedule but a replacement excavator and a second contractor is expected to make up the shortfall.
At the Belvedere project the pre-feasibility study is in progress and three mining leases have been lodged.
Aquila closed on Friday up 10.9% at $3.67.
