Saturday 20th Apr, 2019

Coal miner cuts costs with rail loop upgrade

Photo: Bounty

Coal junior Bounty Mining says a $2 million rail capacity upgrade at Cook Colliery in Queensland’s Bowen Basin has reduced operating costs by at least $5 a tonne.

Bounty told the ASX on August 14 it had completed an upgrade of the Koorilgah rail loop at Cook Colliery, to allow the operation of full capacity 8,500 tonne trains.

The upgrade included the installation of new ballast, formation work, new sleepers and weightometer and train overload facilities.

The miner says a lack of proper maintenance by the previous owner meant the rail loop was operating at a reduced axle load limit.

Bounty acquired Cook Colliery from Caledon Coal in 2017.

“Prior to Bounty restarting operations at Cook early in 2018, the rail loop had been downgraded to 20 tonne axle load capacity due to a lack of maintenance under the previous mine owner,” Bounty said.

“This limited Bounty to using partly loaded trains carrying 5,500 tonnes of coal at a time.

“Full capacity trains, of 8,500 tonnes, will deliver operating cost savings of at least $5 per tonne of coal in line with prospectus forecasts.”

Bounty executive chairman Gary Cochrane said he was “pleased” with the $2 million upgrade.

“We are very pleased to have completed the rail upgrade slightly ahead of the original schedule, delivering a meaningful cost saving as indicated in the prospectus released ahead of Bounty’s initial public offering earlier this year,” Cochrane said.