Anglo American’s Metallurgical Coal business has continued its operational turnaround, guided by record production at three underground mines in Queensland.
The Moranbah, Grosvenor and Grasstree mines all achieved record output in 2017 for Anglo. The strong performance lifted its Metallurgical Coal business to a doubling of underlying profit to $US1.977 billion ($2.52 billion).
Anglo said the result reflected the productivity and cost improvements that the Metallurgical Coal business had embedded at each of the mines over the past four to five years.
The company also realised a 65 per cent increase in the metallurgical coal price in 2017, as the business produced a greater proportion of high-margin hard coking coal.
Anglo Metallurgical Coal chief executive David Diamond said the strong contribution of the business to the company’s overall result followed a challenging period.
“We made some challenging decisions in 2016, resulting in the divestment of Foxleigh, Callide and Dartbrook mines in Australia and commencing a process to divest the Drayton mine,” Diamond said.
“These portfolio changes have enabled our business to focus on producing higher-value metallurgical coal here in Australia. This strategy, and a continuation of our operational productivity and cost improvement measures across all sites, has resulted in a strong performance in 2017.”
Anglo’s Metallurgical Coal business is exploring ways it can improve its performance even further, including studying options to develop the Moranbah South deposit.
Once its ramp-up of the Grosvenor mine is complete, Anglo plans to look at a low capital option to further increase the Moranbah Grosvenor plant capacity.
The business is also progressing brownfields opportunities to expand the Dawson complex, with the extension of the 9-12 pit and options to extend the life of the Grasstree operations by developing the Aquila project.
Diamond said the Metallurgical Coal business would this year focus on improving the productive capacity at each of its mines, including through enhancing technology and innovation, cost disciplines and progressing sustaining projects and low-capital growth options.
“We also recognise the importance of investing in our people and communities and, over the past few months, we have added another 230 roles to our business, including 30 apprentices and 40 graduates across our sites and we have plans to further increase our workforce in Queensland,” Diamond said.