1. COAL : A VIEW from “DOWN UNDER”
Richard Dewhirst, General Manager, Resources Division,
SMEC (Snowy Mountains Engineering Corporation)
July 22, 2016

2. Content The Australian Coal Landscape : Locations
The Australian Coal Landscape : Statistics
Key Issues facing Australian Coal Producers
Coal Washing & Underground Mining
Improving Project Performance – some Personal Views

3. Where is Australia?

4. Significant World Player

5. Locations of Coal Resources

6. Locations of Coal Resources

7. Locations of Coal Resources

8. Locations of Coal Resources

9. Statistics : Coal Matters to Australia

10. How Australia benefits from Coal

11. Australian Energy Production

12. Australian Electricity Generation
Coal is till the major fuel source for electricity generation

13. Coal is Major Contributor to Electricity Generation

14. Coal is a Major Export

15. Key Issues in Australia (1)
Post-”boom”, measures to lift production so as to lower unit costs – but worsened oversupply, particularly thermal coal.
Moves towards:
Cleaner open cut mining through lowering mining equipment sizes and more selective extraction
More direct railed material and lowered processing costs (fewer tonnes washed) – to give higher margin per tonne.
Push to more productive EBAs – the downturn has enabled companies to have more leverage over work place practices.
Underground longwall faces in Australia have now followed US model; better use of equipment uptime (not just coal output) with great effect – Moranbah North, Narrabri are good current examples.
Review of development practices (not just equipment) increased long-wall float and tunnelling speed, and reduced costs. Relatively high gas content in Australian coal mines a challenge (>7 m3 of CH4/t mined).

16. Key Issues in Australia (2)
For example, BHPB:
Safe & reliable operations (<5 TRIF per million manhours worked); better reporting; focus on fatality and serious incidents
High-quality Assets - simple portfolio; large, long-life assets. De-merged; sold; closure; suspension to get rid of higher-cost production.
Unlock productivity. Remove bottlenecks such as
wash plant;
maintenance strategies;
non-coal delays;
higher truck utilization – ultra class fleet and “pit stop servicing”
Questioning of all sustaining capital;
More use of conveyors;
Improved underground development.
….which lead to reduction in costs….and release of latent capacity
Establishing Workforce Enterprise Agreements which focus on flexibility, safety, and productivity.

17. Key Issues in : Industry Initiatives
High Efficiency:Low Emissions (HELE) coal-fired power stations. - CO2 emissions typically 20-25% lower
Carbon Capture and Storage (CCS) technologies
- 90% reduction in emissions from fossil fuel use
Australian coal industry set up the “COAL21” Fund in 2006 (but somewhat “stalled” at present)
- Committed $300M to major demonstration plants and supporting R&D
Sound scientific advice, eg CSIRO and CRC Mining (currently biggest contributor to ACARP (Australian Coal Association Research Program)

18. To Wash or Not to Wash ? Metallurgical Coal is most certainly washed
In general, most Australian coal mines incorporate washing to some degree if coal is to be transported any distance
Depends upon coal characteristics
Many Met coal operations have
installed (or planning to) secondary or
dual wash circuits to produce middlings
for a thermal product, and reduce
tailings discard
Note : Coal ash content is lower than in India (typical 23% -vs- 43%)

19. Underground Coal Mining

20. Coal from Underground New South Wales : (2015) – 21 Underground Mines
- 17 Longwall and 4 Bord & Pillar (though some now closed)
- Produced ~ 80 Mt out of a 250 Mt total (one-third)
Queensland :
(2015) – 13 longwall mines
- Out of a total of 53 mines
- Produced ~50 Mt out of the 300 Mt total (one-sixth)

21. Environmental Pressures : Can we have a Peaceful Co-existence ?
Coal, Wine, Farming, Racehorses and Communities can, and do, co-exist

22. Mining opposition : Adani and other projects

23. Replacing Coal ?

24. Five Lessons Learned Themes to enhance the project delivery process
Project Shaping : Realistic budget and schedule to create a “stable project execution environment”. Get Execution teams involved early (Study stages)
Organisation & People : Team capability, culture, “trust”, and role clarity (co-operative Owner’s and Engineer’s Teams).
Project Execution Readiness and Execution Control. Project Execution Strategy must fit the local environment. Teams must have the same understanding of this and of their respective roles. Need mature project management systems, processes and procedures.
Operational Readiness is required at an early stage (inc. pre-commissioning; training) – get Operators involved early.
Robust Governance with regular independent reviews and information “backbone” required for successful delivery.

25. Staged Approach to Projects

26. Good Engineering Definition is needed for Estimate Accuracy

27. Thank you. Richard Dewhirst
General Manager – Resources Division, South Asia & Middle East
Cheviot Hub, 387, Udyog Vihar – Phase II, Gurgaon – (Haryana), India
T | M

28. Coal & Gas Basins

29. Coal & Gas Basins (2)

30. Proposed Major new Coal Projects

31. Locations of Coal Resources

32. Different Thinking is Required
What do we know contributes to project success?
Influence at Study phase
Allow for Innovation
Cost not the only thing
Highly prescriptive documentation is not the answer

33. Value Adding Possibilities

34. Teamwork : Greater than the Sum of Individuals

35. Resources & Reserve Reporting in Australia - the JORC Code (2012)