A six per cent decrease in run-of-mine (ROM) production and a lower average coal price have contributed to Whitehaven Coal’s mixed December 2023 quarter.
The Australian coal miner’s ROM production for the December quarter equalled five million tonnes (Mt), 300,000t less than the September quarter, and the company shifted coal at an average of $216/t across the three months, 4 per cent below the September quarter.
Despite these declines, the company’s total equity sales equalled 3.7Mt, a 21 per cent increase from the previous quarter. Whitehaven also saw a 20 per cent increase in managed coal sales.
“Maules Creek and the Gunnedah open cut mines delivered solid operational performances while ROM production at Narrabri was impacted by geological challenges in the current longwall and equipment reliability,” Whitehaven Coal managing director and chief executive officer Paul Flynn said.
“Overall ROM production and sales guidance for the 2023–24 financial year (FY24) remains unchanged. However, production and sales mix are expected to reflect the stronger performance at the open cut mines and lower volumes from Narrabri.”
The December quarter also saw Whitehaven acquire BHP’s Daunia and Blackwater metallurgical coal mines for up to $US4.1 billion.
“An average realised price of $216/t was achieved for the quarter, with thermal coal sales realising a premium of five per cent to the gC NEWC index of $US135/t,” Flynn said.
“While high CV thermal coal prices remain resilient in the range of around $US120–150/t, HCC metallurgical coal prices have strengthened to (about) $US300–350/t, which will deliver benefits for Whitehaven post completion of our acquisition.
“The $US1.1 billion five-year credit facility together with cash held of $1.6 billion and ongoing cash generation underpin the completion of the announced acquisition of Daunia and Blackwater mines expected in early April 2024.”
Whitehaven held a net cash position of $1.5 billion as of December 31, after it paid a $833 million tax payment for FY23 in December and a $US100 million cash deposit to acquire the Daunia and Blackwater mines.
