The IPO, which is expected to raise $A500-700 million, is expected to value the company –owned by thoroughbred owner and coal investor Nathan Tinkler – at more than $2 billion when it is floated in June.
Aston’s newly appointed chief executive Todd Hannigan told International Longwall News that Maules Creek, which was purchased from Rio Tinto last year for $480 million, was a “world-class asset” that would attract global attention.
Based on a comparison with industry peers, the mine has superior reserves, a low cost of production, and a diverse product mix, he said.
Aston, which has total coal resources of more than 600 million tonnes, is aiming to develop Maules Creek into a 12Mtpa open cut operation delivering premium semi-soft coking coal and low ash export-quality thermal coal for a mine life of 20 years.
“If you look at the metrics of Maules Creek, it has a reserve base of 220 million tonnes. It has a strip ratio of 5.9 to 1 in the first 20 years. It has very large seams of between four to six metres in width that lend it to bulk mining methods,” Hannigan said.
On a cost per tonne basis it would be comparable to the best of its peers at $60 per tonne, according to Hannigan. Target production date is 2012 with a four to five-year ramp-up period.
The product mix will likely be 40% semi-soft coal and 60% low ash thermal coal.
Hannigan sees a growing market for semi-soft coal – which is currently priced at $167/t – as the market looks to alternatives to the premium hard coking coals, which is priced at $200/t.
“There is a lot of pent up demand for semi-soft coking coal,” he said.
Despite the downturn last year, Tinkler had timed his acquisition of Maules Creek from Rio’s Coal & Allied subsidiary perfectly, Hannigan said.
“Nathan was incredibly astute to buy it at the bottom of the market. He took a long-term view of the asset which was held by Rio for some years and they drilled 650 drillholes there,” he said.
Tinkler is a former Macarthur Coal shareholder and a former BRW Young Rich list frontrunner.
