Australian miner South32 has delayed giving production guidance for its Illawarra Metallurgical Coal business in New South Wales as it continues to review its operations in the wake of elevated gas level issues which it suffered earlier in the year, the company said Thursday.
"We are continuing to review our operating systems and practices at Illawarra Metallurgical Coal, with a specific emphasis on gas drainage and ventilation at the Appin colliery," South32 said in its 2016-17 (July-June) fiscal year results and outlook.
Last week, the state regulator lifted its suspension of operations it imposed on South32's Appin Colliery around seven weeks earlier because of the elevated gas levels, but the miner is yet to resume production.
"A staged ramp-up of the Appin 707 longwall is expected to commence in early September," South32 said.
"The reliability and predictability of its performance, and our associated gas management activities, will inform our future plans and ability to ramp-up to historical rates of production," it added.
In fiscal 2016-17, Illawarra Metallurgical coal production totaled 7.07 million mt, which was down from 8.37 million mt in the previous fiscal period.
Metallurgical coal constituted 5.70 million mt of the total production in the last fiscal year, down from 7.06 million mt in the previous period, while thermal coal production climbed from 1.31 million mt to 1.38 million mt.
The Appin Colliery accounted for 49% of the total Illawarra Metallurgical Coal Production in 2016-17, and typically contributes around 60%, South32 said.
The miner had been planning to release production guidance for Illawarra Metallurgical Coal for both fiscal 2017-18 and 2018-19 in its results Thursday, but now says an update will be released in its September quarterly results which are due October 19.
The Appin mine has been plagued with gas issues with the most recent probation notice being the third the operation has been issued since October 2016, RBC Capital Markets analyst Paul Hissey said earlier in the year.
