Busy days ahead for mine

The Takitimu coalmine in Nightcaps is in full swing in preparation for taking over the supply of coal to Fonterra's Clandeboye plant near Timaru.

The mine, previously known as Nightcaps, was bought a year ago by Eastern Coal Holdings New Zealand Ltd – a subsidiary of Brisbane-based Eastern Corporation Ltd.

In March it was announced that Eastern had won a two-year contract to supply coal to Fonterra's Clandeboye manufacturing site, beating existing supplier Solid Energy. Eastern managing director Campbell Smith said the company would be making considerable expenditure commitments in the next 12 months on plant and equipment, including construction of a new plant.

A new plant was needed to keep up with demand, which would increase 500 percent from processing 50,000 tonnes of coal a year, up to 300,000 tonnes – almost half of that would be needed to supply Clandeboye from next September.

Tender documents for the construction of the new plant were expected to be out by the end of this month. Completion of the new plant was set for May.

"We've got a completion date of May 1 next year, to give us enough time and make sure it's going to perform for the Fonterra contract," Mr Smith said.

The old plant would remain in place to supplement the new one.

About nine staff were employed at the existing plant. Once the new plant was fully operational by the end of next year, staff levels would increase to up to 35 people. Mr Campbell said the mine planned to employ people from the area, including any staff made redundant at Solid Energy's Ohai mine.

Other developments at the mine in the past year included the development of the open-cut pit, repairing the present processing facility and obtaining new contracts.

"We've signed contracts to provide about 50,000 tonnes to the local area this year including the New Zealand Dairy's contract. So we will ramping up and supplying coal for the local industry over the next 12 months."

About 12,000 tonnes of coal had been sold to local industries to date. The company was looking at investing in new downstream processing of the flue gases that arise when coal was burned.

"Just to ensure most of these industrial customers can get back and meet the guidelines of the clean air policy."

Ongoing rehabilitation programmes were also in place.

"We do all our rehabilitation as we go along, as we develop a block of coal we'll dump that coal back into the void that we've previously made. Our ongoing (carbon) footprint is significantly smaller than a normal open-cut pit."