PERTH (miningweekly.com) – The joint developers of the $1.3-billion Eagle Downs coking coal project, in Queensland, have delayed the project’s completion from November 2016, to the first half of 2017.
ASX-listed Aquila Resources reported on Thursday that the continuing softness in the coal price environment prompted the company and its joint venture (JV) partner Vale, to re-evaluate capital spend on the project.
In response to this, the project management presented the JV partners with a revised work programme and budget for 2014, of some A$97.2-million, which has now been approved.
Aquila noted that the short-term deferral of noncritical path expenditure had the potential to considerably improve the economics of the projects, if contracts could be executed in a lower cost environment.
The critical path construction that would be undertaken during 2014 would include the completion of the box cut and portal arches, the start of drift driveage, the establishment of on-site power and raw water supply, as well as maintaining the existing gas drainage wells.
Work would also continue to progress tenders on more favourable terms, including cost and risk sharing for major work packages, such as ventilation shafts, longwall and development equipment, underground conveyors, coal handling and preparation plants and accommodation facilities.
The diversified junior said that these packages have also been rescheduled to start at a later date, in line with the revised project schedule.
Earlier this week, Aquila had said that it would reduce the workforce at Eagle Downs, without disclosing the number of jobs on the line.
The 50:50 JV between Aquila and Vale would produce some 5.1-million tonnes a year, and would have a life-of-mine of 47 years. Production was scheduled to start in 2016.
Aquila currently has capacity of 1.6-million tonnes a year under a take-or-pay contract in Stage 1 of the Wiggins Island Coal Export Terminal, along with the corresponding rail agreement with Aurizon.