South32 has revealed it will take a 500,000-tonne hit to coking coal output after production at its Illawarra Coal-run Appin mine was suspended due to near-explosive methane levels.
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The company has flagged production at part of the Appin Colliery will cease for about a month following the incident, to allow remedial work to be carried out at the site.
Operations at the mine were halted by the NSW Resources Regulator last Wednesday after methane levels exceeded legal limits.
Construction, Forestry, Mining and Energy Union (CFMEU) district vice-president Bob Timbs told the Mercury on Monday the peak gas reading of 4.73 per cent methane was “very close to the explosive level”.
Explosive levels were between five and 14 per cent, Mr Timbs said.
The build-up of gas was the result of a ventilation fan failure, South32 confirmed in a statement to the ASX on Monday night.
The company also confirmed the Appin mine had received a prohibition notice from the regulator on October 26, “having reported elevated gas concentrations at Appin Area 7”.
“Longwalls 7 and 9 were subsequently suspended to enable an investigation to be completed,” the statement said, adding the fan failure was “promptly rectified”.
South32 said the Area 7 longwall would return to production at a reduced rate until tests confirmed methane gas concentrations could be maintained at a safe level.
However, after restarting the Area 9 longwall “it became apparent that the outage exacerbated challenging ground conditions”.
Area 9 production was suspended for the remedial work, which is expected to take four weeks to complete.
The Area 9 longwall has proven to be problematic for South32 in recent months.
In September, roofing problems at the mine resulted in a disruption to shipments and a subsequent reduction to the miner's full-year coking coal guidance from the operation to 7.55 million tonnes, from a previous guidance of 8.15 million tonnes.
South32 said on Monday a saleable production loss of about 500,000 tonnes was anticipated due to the suspension at Area 9 and Area 7’s gradual return to production.
It said this would “translate directly to sales given low inventory” but did not provided revised full-year guidance for the operation.
While the Illawarra operation produces both coking and energy coal, it is understood the hit to production impacts only coking coal.
- with Tess Ingram
Andrew Pearson
Andrew grew up in the western Riverina town of Hay and has strong ties to the region. He is a former DA journo who has a passion for breaking news and has covered everything from council and politics to crime and court.
Andrew grew up in the western Riverina town of Hay and has strong ties to the region. He is a former DA journo who has a passion for breaking news and has covered everything from council and politics to crime and court.
