Aurizon awarded Qld coal haulage contract with BMA/ BMC

Aurizon has secured a new long-term, performance-based contract with BM Alliance Coal Operations Pty Limited (BMA) and BHP Billiton Mitsui Coal Pty Limited (BMC) for the haulage of up to 65 million tonnes per annum (mtpa) of coal from its mine operations in Queensland.

The contract represents 100% of tonnes tendered by BMA/BMC for re-contracting in the Blackwater and Goonyella systems to the ports of RG Tanna in Gladstone, and Hay Point and Dalrymple Bay near Mackay.  It is effective from 1 July 2015 for the Blackwater system and 1 July 2016 for the Goonyella system.

The new contract replaces the existing 2005/6 legacy contract with up to a 12-year term, new-form contract.  It provides improved commercial returns for Aurizon based on a flexible, performance-based contract for BMA/BMC.

With the inclusion of the renewed BMA/BMC contract, Aurizon’s conversion of old-form contracts into new-form performance-based contracts for customers will increase from 38% at FY12 to approximately 95% of the Company’s expected railed tonnages from FY17.

Aurizon Managing Director & CEO Lance Hockridge said Aurizon was delighted to renew its long partnership with BMA/BMC in Queensland, which started with BHP in Queensland in the 1970s.

  “This is the largest contestable haulage contract in the Australian coal market in a decade.  It represents about a quarter of the entire Queensland coal haulage market,” he said.

“We’ve worked extremely hard to deliver a service package that is large-scale, flexible and performance-based.”
Aurizon Executive Vice President Commercial and Marketing Paul Scurrah said the agreement included supply chain performance monitoring and productivity sharing initiatives.

The contract includes the haulage of coal from the Blackwater, Gregory, South Walker Creek, Poitrel, Riverside, Goonyella, Saraji, Peak Downs and Daunia operations.

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