March 2016 Quarterly Report
Brisbane, April 29, 2016 AEST (ABN Newswire) - Stanmore Coal Limited (
ASX:SMR) are pleased to provide the Company's March 2016 Quarterly Report.
Highlights:
- Waste and coal mining commenced in February with 34,500 ROM tonnes stockpiled during March quarter
- First coal processed in April through the restarted Isaac Plains wash plant
- Annual coking coal contract signed with major East Asian steel producers
- Total JORC Reserve1 tripled from 5.0Mt to 15.3Mt
- Total JORC Resource1 more than doubled from 30.1Mt to 76.9Mt
- Open-cut mine life expanded from 3 years to over 10 years2 with the maiden Isaac Plains East JORC Reserves (10.3Mt)
- Isaac Plains Mining Complex declared as a "Prescribed Project" by State Government
COAL SALES AND MARKET OUTLOOK
Coal processing at Isaac Plains commenced in April with the first shipment expected in early May.
Stanmore Coal Limited (Stanmore or the Company) has signed or agreed terms for the Japanese financial year 2016 with top tier Japanese and Korean steel mills on annual semi-soft benchmarklinked contracts totalling 900,000 tonnes (t) of coking coal. The Company is well progressed with contract discussions for the remaining 200,000t of thermal coal product.
Recent positive moves in the hard coking coal price serve as a reminder that coking coal remains a relatively scarce resource. The spot premium hard coking coal price has seen an increase of approximately 25% over the past 3 months to above USD 100 per tonne. Whilst the PCI and SSCC coals have yet to experience the same level of increase, the uplift in premium products has provided some positive price momentum to the entire coking coal market.
This is reflected in the recent June quarter settlement for Japanese benchmark coking coal prices at a US$ 3-4 increase over the previous quarter. We note hard-coking coal benchmark prices increased from US$81/tonne to US$84/tonne, while semi-soft coking coal prices increased from US$66/tonne to US$70/tonne. In recent years, benchmark prices have typically outstripped spot, reflecting the top tier Japanese and Korean customers' requirement for certainty and consistency of supply. If the spot market for hard coking coal products remain around current levels that is likely to put upwards pressure on benchmark settlements in the next quarter for all coking products. In addition, the recent settlement of the JPU benchmark thermal coal price at US$61.60/tonne, well above the current thermal spot price, provides further confidence in the outlook for coal producers.
Selling out the company's first year of coking coal production to top tier Asian steel mills is a very strong result and underpins a positive return to the market for the sought after Isaac Plains coking coal. It fits well with Stanmore's goal of building long term relationships with major steel making customers. The Company continually monitors its optimal product mix and has the ability to produce a semi-hard coking coal (subject to existing contractual arrangements) in the future should hard coking coal process remain relatively strong. There is considerable flexibility built into the wash plant and our mining methods which provides the ability to respond to market conditions as appropriate.
To view the complete report, please visit:
http://abnnewswire.net/lnk/35ZJC279
About Stanmore Coal Limited
Stanmore Coal (ASX:SMR) is an operating coal mining company with a number of additional prospective coal projects and mining assets within Queensland's Bowen and Surat Basins. Stanmore Coal owns 100% of the Isaac Plains Coal Mine and the adjoining Isaac Plains East Project and is focused on the creation of shareholder value via the efficient operation of Isaac Plains and identification of further local development opportunities. Stanmore continues to progress its prospective high quality thermal coal assets in the Northern Surat Basin which will prove to be valuable as the demand for high quality, low impurity thermal coal grows at a global level. Stanmore’s focus is on the prime coal bearing regions of the east coast of Australia.
| ||
|
