Coal price rally breathes life into Integra

Dec 9, 2016 | fluid management, oil analysis

Coal price rally breathes life into Integra

A rally in coal prices has revitalised an industry that only a few months ago was at a low ebb with little expectation of better times in the future. The price recovery has prompted miners to resume operations at mines closed in the past year and re-examine expansion plans.

Glencore has reacted positively by pledging to reopen the mothballed Integra underground mine in the Hunter Valley of New South Wales as well as ramp-up the Collinsvale open cut mine in Queensland’s Bowen Basin.

coal price

Integra produces high fluidity semi-hard coking coal and Glencore is targeting a restart early in 2017, possibly as soon as the first quarter. The specifications of Integra coal, according to S&P Global Platts data, are 50% CSR, 38% VM, 9% ash, 9% total moisture, 0.5% sulphur, 0.015% phosphorous, 7 CSN and 5000 ddpm max fluidity.

This coal is highly prized by Asian steelmakers, particularly in Japan and India, but there is tight supply, exacerbated by closure of BHP Billiton’s Gregory Crinum mine late last year.

Integra’s underground operation has more than 35 million tonnes of semi-hard coking coal in reserves and has approval to produce 4.5 million tonnes annually. Previous owner Vale placed the mine on care and maintenance in July 2014 due to challenging market conditions.

Integra underground mine, 12km northeast of Singleton and formerly known as Glennies Creek, was sold to Glencore in August 2015 while the remainder of the mining complex, which includes an open-cut mine, coal washing plant and load-out facility for rail, was sold to the Bloomfield Group.

Since the purchase Glencore has been assessing options for a restart against global market conditions. Head of Australian coal operations Ian Cribb said the infrastructure was already in place to commence extraction. “Integra has one longwall block already formed, providing an opportunity to begin mining with minimal delays or additional investment. Over the next two years, we also plan to complete and extract coal from a second longwall block that has been partially developed.”

Glencore expects to produce 1.3 million tonnes of high fluidity saleable coking coal at Integra in 2017 to meet a specific need in the metallurgical coal market. The project is tipped to employ up to 275 workers.

Also in the Hunter Valley, Glencore is looking to at least retain 500 jobs at the Mt Owen Complex through a proposed expansion. The complex comprises Mt Owen, Glendell and Ravensworth East open cut mines with production having ceased at the latter.

In November the NSW Planning and Assessment Commission approved the expansion of Mt Owen mine and Glencore hopes this will result in retention of 500 jobs at the complex, and possibly even create more employment. Existing operations at Mt Owen open pits will be expanded to enable extraction of an additional 86 million tonnes run-of-mine coal. The project will extend Mt Owen mine by 382 hectares and mine life by 12 years, to 2030.

Glencore and its JV partner, a Peabody Energy subsidiary, have also lodged a development application for development of a mine combining the existing open cut operations at Wambo Coal with a new open cut at United Collieries, providing another 250 jobs. It is proposed that Glencore will manage the operation utilising Wambo’s existing infrastructure while Peabody will continue to operate the Wambo underground, CHPP and rail facilities.

Techenomics, which serves the Hunter Valley mining industry with oil analysis and fluid management services from its Newcastle facility, welcomes the revitalisation of the coal industry, which has been the lifeblood of the Hunter Valley for many years. Techenomics has a role to play in helping the industry achieve sustainable maintenance through its innovative, cost-saving services. Contact Chris Adsett,, or Leo Valenz,

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