By Peter Ker
June 5, 2019 - Anglo American could soon be exporting more Australian coking coal with fewer truck drivers as it weighs up several new investments in its Queensland mines.
Amid extremely high prices for the steel-making ingredient, Anglo has increased the scope of studies into an expansion of a coal preparation plant that services its best two coking coal mines – Moranbah North and Grosvenor in the heart of Queensland's Bowen Basin.
Announced in June 2018, studies into the preparation plant were initially focused on a 25 percent expansion, but Anglo's chief executive of metallurgical coal, Tyler Mitchelson, said the studies were now looking at the potential to raise production by as much as 40 percent.
''Moranbah North and Grosvenor both feed the same preparation plant, we are looking at a major expansion of that plant because we can see the capability in both of these underground mines to produce much more than they are right now,'' he told The Australian Financial Review.
''It is not a new mine, [but] it is basically creating a new mine out of two existing mines through productivity improvements.''
The exact cost of the expansion won't be known until the study is complete, but Mr Mitchelson said it would be "less than a billion dollars".
Moranbah North produced 6.76 million tonnes in 2018 while Grosvenor produced 3.76 million tonnes.
Based on a 40 percent lift, the expanded preparation plant could allow Anglo to sell an extra 4 million tonnes of coking coal per year from 2021.
Prices for premium hard coking coal from Queensland were extremely high at $US207 per tonne last week, and at such prices an extra 4 million tonnes would be worth about $US828 million in revenue.
The coal-rich Bowen Basin was one of the regions of North Queensland that swung strongly towards the Coalition at last month's federal election, and Mitchelson said it was good to see mining's impact on the Australian economy being acknowledged in the wash-up from the election.
''Looking at the election results I think it is great the resource industry was recognised and I think it is great we are seeing some support for the sector again,'' he said.
''For us in particular in Anglo American we want to make these investments, we want to grow the business in Australia so having a very supportive government with supportive legislation is critical for us to be able to succeed and be able to grow the business the way we want to."
Anglo could also soon be investing in a new fleet of autonomous trucks for its Dawson coal mine in Queensland, with Mitchelson saying a separate study was under way into that option.
Dawson has 23 human-operated trucks that will soon be due for either replacement or refurbishment, and Anglo is expected to make a decision between those two options later this year.
While similar studies at rival Australian miners have tended to resolve that investment in autonomous trucks is the preferred option, Mr Mitchelson said the outcome of the study was not certain.
"It is not a slam-dunk," he said.
Mitchelson said the Dawson case was complicated by the fact autonomous trucks would need to interact with human-operated vehicles and equipment if they were adopted; unlike some other mines that have been built with full autonomy from the outset.
Mitchelson said the cost of adopting autonomous fleet, and the impact on job numbers at the mine would not be known until the study was complete.
The Dawson study is the latest example of autonomous vehicles becoming the norm in big Australian mines, with Rio Tinto, BHP, Fortescue and Roy Hill using autonomous vehicles on some of their iron ore mines in Western Australia.
Rio is also using autonomous trains in WA, while BHP is studying the economics of automating the entire fleet within the Minerals Australia division.
Anglo produced 21.8 million tonnes of coking coal from its Australian mines in 2018, up from 19.6 million tonnes in 2017.
The company expects to sell between 22 million and 24 million tonnes of coking coal in 2019, with about 86 percent of those volumes being premium hard coking coal and the remainder being semi-soft or pulverised coal injection coal.
Anglo considered selling Moranbah North and Grosvenor at the bottom of the coal market in 2016 as the company struggled with a debt crisis.
BHP was among the suitors in a sale process that was disrupted by an extraordinary rally in coking coal prices in the latter months of 2016.
Anglo decided to keep the mines and Mitchelson said the preparation plant study was an example of the miner committing to its Australian business.
''Over the next five years we are really intending to reinvest in the business and grow the business,'' he said.