All Topics / General Property / Who invested in Dysart? Mine is closing…..

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  • Profile photo of bardonbardon
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    @bardon
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    In the context of this thread the extension to Thiess contract, specifically given the location, the job stability and the thread title is actually quite significant. I only read their ASX release which was factual; and once again relevant to this thread, as opposed to iron ore tonnages out of the Pilbara.

    Profile photo of HengistHengist
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    Yes Freckle, in overall terms the increase in Coal exports is minimal, but to the Dysart area and the 90+ people with unrented properties this might be a biggie..

    Profile photo of FreckleFreckle
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    bardon wrote:
    In the context of this thread the extension to Thiess contract, specifically given the location, the job stability and the thread title is actually quite significant. I only read their ASX release which was factual; and once again relevant to this thread, as opposed to iron ore tonnages out of the Pilbara.

    Bardon there’s a few iron ore miners in the Pilbara who do about 3 – 5mtpa. If you weren’t told they were there you wouldn’t notice. They’re absolutely tiny in the scheme of things.

    If I’ve read and interpreted the release correctly Thiess have simply retained an existing contract and will manage a relatively small expansion over 3 years provided they can get access to transport to shift the stuff. In reality it’s still speculation until logistics materialises to move their extra production to port. That might be a challenge because everyone else is trying to do the same.

    Then there’s the opposite side of the coin…

    Global coal output to shrink as mining margins retreat
    Author: By Jacqueline Cowhig
    Posted: Wednesday , 25 Jul 2012

    Analysts and industry executives expect global coal output to shrink over the next year or two as miners grapple with a combination of low prices, weak demand and cost and currency headwinds.
    http://www.mineweb.com/mineweb/view/mineweb/en/page504?oid=155723&sn=Detail&pid=102055

    Rio Tinto to Cut Australia Coal Jobs After Fall in Price
    Published July 19, 2012
    Dow Jones Newswires

    Rio Tinto PLC (RIO) said Thursday it expects to cut an unspecified number of jobs at one of its coal mines in northeastern Australia as it seeks ways to offset a slump in prices for thermal coal.
    Read more: http://www.foxbusiness.com/news/2012/07/19/rio-tinto-to-cut-australia-coal-jobs-after-fall-in-price/

    Profile photo of FreckleFreckle
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    Hengist wrote:
    Yes Freckle, in overall terms the increase in Coal exports is minimal, but to the Dysart area and the 90+ people with unrented properties this might be a biggie..

    90+ PI’s could probably accommodate that work force several times over. Any increase is likely to be FIFO based. While it may help I wouldn’t be getting too excited just yet. The likelihood this will go ahead (expansion) is questionable in the current market. Releases like this are suspect. I’m thinking this little media event is more about keeping share prices up and investors happy.

    Profile photo of JpcashflowJpcashflow
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    @jpcashflow
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    Only time will tell and speculation is the mother off all "F" ups.
    When bad news is presented there are two different reactions one positive and the other negative. Who is right or wrong is based on  every ones personal circumstance.
    Mining at the moment is in Limbo, Unions are demanding more money, more taxes and there are allot of mines who are sacking people but you wont even here it on the news.
    My uncle "was working" for a large miner and only two weeks ago they let go 70 Staff and it has not even been reported on the news.
    Things change so quickly these days so today with the new it might look bad but tommorow you never know a new mine might just open and then things may change.

    Jpcashflow | JP Financial Group
    http://www.jpfinancialgroup.com.au
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    Your first port of call in finance :)

    Profile photo of bardonbardon
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    Freckle wrote:
    If I’ve read and interpreted the release correctly Thiess have simply retained an existing contract and will manage a relatively small expansion over 3 years provided they can get access to transport to shift the stuff. In reality it’s still speculation until logistics materialises to move their extra production to port. That might be a challenge because everyone else is trying to do the same.

    Well I never read in the release that the award of the contract was conditional on anything.

    Profile photo of FreckleFreckle
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    bardon wrote:
    Well I never read in the release that the award of the contract was conditional on anything.

    LAKE VERMONT EXPANSION

    In 2011, Jellinbah Group commenced the expansion of it’s Lake Vermont mine to a 8Mtpa operation. As part of the expansion, a duplicate CPP is being constructed by the Thiess Sedgman Joint Venture and is scheduled to be completed by late 2012. The mine will operate at a 6Mtpa production level from 2013 and 8Mtpa production level from 2015, as logistic infrastructure becomes available.
    http://www.jellinbah.com.au/news/current-news.html

    Profile photo of FreckleFreckle
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    Sedgman’s part in the JV

    Lake Vermont Lake Vermont Resources Bowen Basin, Queensland

    Design, construction and commissioning of 800 t/h CHPP including train loadout facility capable of dispatching coal from site at a rate of 4,000 t/h. Capable of producing two products – a coking coal product and a pulverised injection (PCI) product. Outcome redefined industry benchmarks and Lake Vermont is now widely acknowledged as industry best practice.?

    Lake Vermont Upgrade Lake Vermont Resources Bowen Basin, Queensland

    Duplication of original Lake Vermont CPP to increase CHPP from 4 M/ta to 6 Mt/a? as well as raw coal areas and brownfields product side upgrades.

    Profile photo of JpcashflowJpcashflow
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    Freckle thats all speculation,
    "The mine will operate at a 6Mtpa production level from 2013 and 8Mtpa production level from 2015, as logistic infrastructure becomes available.

    What happens if some thing changes? There are so many projects being delayed….

    Jpcashflow | JP Financial Group
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    Your first port of call in finance :)

    Profile photo of bardonbardon
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    The fact of the matter is that Thiess have been awarded a $2.3b contract for a mine near Dysart.

    Profile photo of moxi10moxi10
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    And a more positive article about the coal market…

    http://www.miningweekly.com/article/peabodys-profit-cools-amid-signs-of-rebounding-coal-markets-2012-07-24

    And a negative on the impact of the Norwich Park mine closure on Dysart

    http://www.cqnews.com.au/story/2012/07/27/fractured-town-spirit-takes-toll-on-families-resid/

    And although I prefer positives, there are definitely some negative elements emerging…

    http://www.cqnews.com.au/story/2012/07/27/contractors-take-brunt-of-thermal-coal-slump/

    Profile photo of FreckleFreckle
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    bardon wrote:
    The fact of the matter is that Thiess have been awarded a $2.3b contract for a mine near Dysart.

    Thiess already manage the mine. Their contract’s been renewed. What they’re not telling us is how much of the $2.3b is standard operating cost (no real increase in spending) and how much is going to Sedgman’s for their expansion build.

    Like I keep saying Bardon. It’s penny ante stuff – less than a billion per year. Even less when you consider how much is additional expenditure over and above the current spend.

    Profile photo of FreckleFreckle
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    It may all be moot anyway if prices keep declining at their current rate.

    Thailand’s top coal miner Banpu has suspended up to US$600 million of its four-year investment plan and lowered its production target by 10% due to softening coal prices.

    Of the total amount,investments allocated for Australian operations will be lowered by to $400 million. Capital expenditure planned for Indonesia will be cut by $100 million from $345 million, while the budget for Mongolia is down by $250 million from $400 million.

    Then you have India the supposedly new mega market for coal as it tries to grow electricity output to support economic growth. Problem is that idea is falling apart fast. They have mandated cheap electricity however they can’t sustain that with current imported coal prices.

    For Australia there are plenty of international suppliers (competitors), a market glut and soft prices. Australian miners need to get around $80/t (thermal coal) to get past break even but new mines will struggle to stay viable at that price.

    For those investing or invested in towns within coal mining regions there may well be tough times ahead. The downward pressure on prices is likely to remain for the foreseeable future and the likelihood of mines going into care and maintenance along with suspended expansion plans seems highly likely.

    Profile photo of DubstepDubstep
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    Profile photo of blndd6blndd6
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    Hey mate, curious how you went with this investment and what your thoughts are currently on purchasing in Dysart. I can see prices have significantly dropped since 2010. Cheers!

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