PERTH (miningweekly.com) – Diversified resources group Xstrata expects the first coal from its Ulan West underground mine, in New South Wales, in 2014, the miner said on Tuesday, when it announced the approval of $1,1-billion to develop the mine.

Construction on the 6,7-million-ton a year thermal coal mine, which would have an 18-year life, was set to start before the end of the year.

Situated within the existing Ulan mine complex, Ulan West will complement the Ulan number-three underground mine and use some of the existing infrastructure at the Ulan complex.

"The development of Ulan West will add another low-cost, efficient longwall operation to Xstrata Coal's portfolio, leveraging a known resource base at Ulan to increase our production volumes by at least seven-million tons a year to satisfy growing demand for export quality thermal coal in Asia," said Xstrata Coal CEO Peter Freyberg.

"Through our continued investment into new operations, Xstrata Coal is providing new employment and local business opportunities within the Mudgee region and making an important contribution to the state's economy," he added.

The construction of the mine will create about 270 new jobs, with an expected 350 employees required for ongoing operations.

Xstrata also on Tuesday also approved the $4,2-billion investment in the Las Bambas copper project, in southern Peru, and announced its half-year financial results.

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