Coal news and updates

Whitehaven sees coal price recovery

Whitehaven Coal says it is seeing a recovery in long-depressed prices, after achieving record quarterly output.

The NSW coal miner has also started talks with its lenders, led by ANZ, about restructuring its $1.2 billion debt facility because of delays to its new mine at Maules Creek caused by legal challenges.

Managing director Paul Flynn said he was starting to see signs of life in the metallurgical and thermal coal markets.

Its more lucrative metallurgical product, Newcastle semi-soft coking coal, realised $US102 to $US103 a tonne in the September quarter.
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Whitehaven plans to produce more of that out of its Narrabri mine to meet Asian steel demand.

The prices of its thermal coal was relatively weak, at $US77.53 a tonne.

However thermal coal contract prices were increasing slightly, with Japanese and Korean companies restocking before the winter, the company said.

"It certainly seems the softness that we were seeing in previous quarter has abated," Mr Flynn said.

He said the company was now well placed for a good operational performance, following last year's $82 million loss.

Whitehaven shares gained 3.5 cents, or two per cent, to $1.77 on Friday.

The company's share price has halved since the start of the year.

"This is a transitional year between continuing the existing smaller operations, ramping up Narrabri and the bridging period before we see production out of Maules Creek," Mr Flynn said.

Action by anti-coal activists has delayed work on the $767 million Maules Creek project.

Mr Flynn said he was confident the debt could be restructured before the end of 2013, and there was no danger of the group breaching its covenants.

First production has blown out from next year to at least early 2015 and is expected to more than double Whitehaven's production to 25 million tonnes a year.

Whitehaven said it sold 2.03 million tonnes of coal during the three months to the end of September, up 26 per cent on the same period last year.

It produced a record 2.4 million tonnes, up 44 per cent on a year ago, driven by better production out of its Narrabri mine.

Source: The Sydney Morning Herald