Peabody Energy: Approved Wilpinjong coal mine expansion

Peabody Energy, the largest private-sector coal company in the world and the global leader in clean coal solutions, has approved the expansion of the Wilpinjong thermal coal mine in New South Wales. The coal mine is due to increase coal production by two to three million tons per year, starting in 2012.

The capital investment for the project is anticipated to reach approximately $90 million, including roughly $20 million targeted for 2010. The Wilpinjong mine is one of the lowest costing mines in the country. Expanded production will serve export markets using new port capacity from the recently commissioned Newcastle Coal Infrastructure Group (NCIG) terminal. That project is subject to final permitting and regulatory approval, as late stage licensing and mine-engineering activities are progressing forward.

"The Wilpinjong expansion is among a number of organic growth initiatives to build our global platform for serving the fastest-growing economies and coal markets in the world," stated Peabody Energy Chairman and Chief Executive Officer Gregory H. Boyce. "Asian nations are forecast to account for more than 90 percent of global coal demand growth in the next two decades, and Australia will continue to build its position as the chief supplier of seaborne coal."

The expansion is one of various thermal and metallurgical coal projects with the potential to expand Peabody’s annual Australian volumes to 35 to 40 million tons by 2014. Peabody has a goal of increasing seaborne metallurgical coal shipments to 12 to 15 million tons annually by 2014. Thermal coal exports are due to increase to 15 to 17 million tons annually as well. Peabody has also approved a one million ton-per-year expansion of the Metropolitan metallurgical mine, also located in New South Wales. In 2009, the Wilpinjong mine shipped 8.3 million tons to meet domestic and global demand.