$760m Port Waratah expansion 'will honour contracts'

Port Waratah coal terminal to spend $670 million to add another 20 million tonnes of capacity to the facility

February 4, 2009

The Port Waratah coal terminal will pump another $670 million into infrastructure at the Newcastle wharf, adding another 20 million tonnes of capacity to the facility.

The Port Waratah Coal Services (PWCS) board yesterday approved the spend, taking total expenditure on coal loading infrastructure over the past 12 years to more than $1.6 billion.

The operator says the expansion will help manage ongoing demand for Hunter Valley coal and honour long-term coal export contracts recently signed by PWCS and Hunter Valley coal producers.

The works are scheduled to be completed by the end of 2011 in order for PWCS to meet its contractual obligation of handling 123.6 million tonnes in 2012.

Feasibility, procurement and preliminary engineering work have been underway since mid-2008.

The project will see a new 330m coal loading berth built, along with the extension of two key coal stockpiling pads (where coal is stored ahead of being conveyed and loaded onto vessels) and the replacement of two stacking machines.

The expansion is the largest single advance in terms of capacity addition and expenditure at PWCS in more than ten years.

PWCS Chairman Michael Harvey says the expansion will allow the terminal to meet the Newcastle contractual framework, which came into effect on January 1.

"PWCS played a leading role with industry participants and the New South Wales Government seeing the Long Term Contractual Framework to fruition, and the onus is now on us to keep building new terminal infrastructure as quickly and efficiently as possible," he says.

"Given that PWCS has signed contracts with producers, we are in a far better position to expand terminal infrastructure in a more accurate and timely manner.

"We are embracing the challenge and getting on with the job."

PWCS General Manager Graham Davidson says while the company will utilise global expertise and materials, much of this will be drawn from the Hunter Valley.

PWCS has also announced a producer export allocation reduction of 1.7 million tonnes to be applied on a pro-rata basis, due to coal loading shortfalls over January.

PWCS loaded eight million tonnes in January, despite being scheduled to load 9.7 million tonnes. The shortfall was due to internal factors such as equipment breakdowns and external factors including adverse weather, power supply failures and vessel delay issues.

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