dfs section 2 executive summary

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EAGLE DOWNS COAL PROJECT FRONT-END LOADING 3 DEFINITIVE FEASIBILITY STUDY

CHAPTER 2 EXECUTIVE SUMMARY

2.1 Project Overview

Eagle Downs involves proposed construction, development and operation of an underground longwall hard coking coal mine in Queensland’s resource-rich Bowen Basin

Eagle Downs Coal Management (EDCM) represents owners Vale and Aquila

Vale FEL3 and Aquila DFS deliverables have been mapped and addressed.

The Eagle Downs project involves proposed construction, development and operation of an underground longwall hard coking coal mine, in Queensland’s Bowen Basin. The proposed mine is located south of the town of Moranbah, central Queensland, and is down-dip of the neighbouring BHP Billiton Mitsubishi Alliance (BMA) Peak Downs open-cut mine. The project is managed by Eagle Downs Coal Management Pty Ltd (EDCM) on behalf of the Bowen Central Coal Joint Venture (BCCJV). The mine is planned to produce export metalliferous coal from three target seams in the Moranbah coal measures. Planned run-of-mine (ROM) coal production from the mine is in excess of five million tonnes per annum (5mtpa), of which the majority will be classified as hard coking coal.

The project has access to rail infrastructure that traverses the southeast corner of the site. A rail spur and balloon loop will be constructed within the Eagle Downs mine lease, connecting to the Peak Downs branch of the Goonyella Coal Network. Coal will then be transported to regional ports on the Queensland coast, as illustrated in Figure 2-1. Power is available from the Powerlink-owned 132-kilovolt (kV) Moranbah-to-Dysart transmission line that traverses the site. It is planned for water to be sourced from the Southern Spur pipeline duplication, which provides water from the Moranbah terminal storage supply. Water will also be sourced from SunWater’s Connors River dam.

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]

Figure 2-1: Eagle Downs Location (Queensland)

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Figure 2-2: Eagle Downs Location (Local – Adjacent Mines and Infrastructure)

2.1.1 Project Ownership

The Eagle Downs project is owned by BCCJV, the participants in which are Bowen Central Coal Pty Ltd (50%) – subsidiary of Brazilian mining company Vale – and Aquila Coal Pty Ltd (50%) – subsidiary of Australian-listed mining company Aquila Resources Ltd. EDCM manages the BCCJV on behalf of the participants.

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2.1.2 FEL/DFS Process

A conceptual Front-End Loading (FEL) 1/Definitive Feasibility Study (DFS) was completed in June 2008 and evaluated by the JV participants under their respective tollgate processes in July 2008. Upon JV approval, the next study phase (FEL2/FS) commenced and was completed in June 2009. After requesting additional information (FEL2/FS Addendum, February 2010), the JV approved the project progressing to FEL3/DFS.

All studies were prepared to accommodate BCCJV requirements. Each JV participant had different requirements in terms of review, terminology and tollgating processes. Subsequently, EDCM did not adopt a single standard for the work.

FEL3/DFS identified that A$1.3 billion of project capital expenditure will be required to develop the mine, up until the first 100,000 tonnes (t) of longwall coal.

2.1.2.1 Vale FEL Methodology

To support Vale’s gate decision-making, FEL development is evaluated through assessments before proceeding through each gate:

Figure 2-3: Project Lifecycle with Gates

2.1.2.2 Aquila DFS Process

The following standard is part of Aquila’s project delivery system and defines the deliverables required to be presented and demonstrated during the DFS stage of Aquila’s project delivery process:

Figure 2-4: Aquila Project Delivery Process

Development phase

Gate 1

Construction

Gate 3Gate 2

Execution Planning

Trade-off analysis

Business Analysis

Operation

Cancel

Recycle

Proceed

Initiate Start up

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2.1.2.3 Lead Consultants

A detailed list of FEL3/DFS deliverables from both JV partners was provided to a select group of engineering consultants for each area of the project to ensure that all requirements were covered in FEL3/DFS. These lead consultants are detailed in Table 2-1:

Table 2-1: Lead Consultants

Area Consultant

Surface Infrastructure AECOM

CHPP Sedgman

Underground Mining Mining Consultancy Services (MCS)

Underground Engineering MineCraft Consulting

2.1.3 Business Objectives

EDCM aims to design, construct and operate a safe and productive longwall operation at the Eagle Downs mine site to maximise JV participants’ return on investment. In line with these business objectives, numerous financial and engineering studies were completed and are planned to ensure that the following business objectives are achieved:

Safe mining culture with the aim of zero harm

Low-cost, high productivity longwall mine utilising all available enabling technologies

Delivery of a coal product on time and to customer specifications

Sustainable mining operation that manages all onsite water, dust, noise and landform interactions with the mine to standards that exceed government and community expectations.

2.1.4 Project Objectives

Eagle Downs project objectives are to:

Develop a fit-for-purpose underground coal mine with an initial capacity of at least 5mtpa of ROM hard coking coal

Design and construct a fit-for-purpose underground longwall coal mine that can be operated in a safe and profitable manner

Maximise the economic and effective recovery of the identified resource

Comply with all relevant legislation during all phases of the project (design, construction and operation)

Construct and operate the mine with sympathetic regard to all affected and interested parties, e.g. landowners, Native Title holders, community interest groups, government agencies, etc.

Maintain the reputation of JV participants within the mine workforce and community.

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2.2 Market Analysis and Business Strategy

Current tight supply conditions are expected to be alleviated with commissioning of new supply streams and alleviation of port and rail constraints

The Eagle Downs brand should be well received in global metallurgical coal markets.

Supply conditions for global seaborne trade of coking coal are currently tight and growth in demand is expected to exceed growth in supply. An important long-term driver of hard coking coal demand growth is the increasing use of larger blast furnaces. These larger blast furnaces require higher-strength coke to support larger and heavier volumes of blast furnace burden. Growth in the supply of coking coal is expected to be constrained by such issues as rail and port infrastructure limitations, government intervention and the diminishing rate of high quality coking coal reserves.

Severe flooding in Queensland reduced availability of high quality coking coal in the December and March quarters of 2010/11 and has contributed to record sales prices. In the medium term, coal prices are expected to remain strong, above US$230/t FOB until 2013. Subsequently, price growth is likely to slow as tight demand and supply market conditions are eased with the commissioning of new supply streams and alleviation of port and rail constraints.

In the long term, AME assumes that critical rail and port infrastructure expansions will be implemented and provide sufficient capacity to alleviate potential bottlenecks for landborne and seaborne trade, particularly in Australia. The addition of these new capacities may mean contract prices will begin to stabilise.

The Australian dollar forecast of coal pricing for the life of the Eagle Downs Mine is particularly difficult to determine in the current global economy. The two components of the pricing – selling price in US$ and the US$-A$ exchange rate, are both currently well outside of historical trends, with financial and market analysts reluctant to forecast beyond five years

To apply consistency to price and exchange rate, EDCM sought long-term price and exchange rate projections from Merrill Lynch, the only organisation from which both could be sourced:

Standard hard coking coal US$167.33/t FOB

Exchange rate A$/US$0.77.

The Dysart (DY) seam will produce a higher quality standard hard coking coal than the Harrow Creek Upper (HCU) and Harrow Creek Lower (HCL) seams. There is also some deterioration of quality in the deeper areas of each seam. This variability is not seen to have any material effect on the marketability of the Eagle Downs brand but price penalties/bonuses were assumed to reflect the financial impact of the quality variation.

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2.3 Project Evaluation and Expenditure

Schedule A IRR = 15.22%, NPV $675 million (10%) and $349 million (12%)

Schedule B IRR = 15.16%, MPV $602 million (10%) and $302M (12%)

Project capital cost = $1.25 – $1.26 billion

Operating costs = $27.48/ROMt, $74.77/Prd t FOR and $112.70/Prd t FOB.

2.3.1 Economic Evaluation

A cashflow analysis was developed for execution of Schedule A and Schedule B. Both execution schedules will provide attractive internal rates of return (IRR) and net present value (NPV) for the project, with Schedule A being slightly more attractive.

The IRR, NPV and payback period (at 10% and 12% discount rates) for life-of-mine (LOM) production are provided in Table 2-2:

Table 2-2: Eagle Downs Economic Analysis Summary

Execution Schedule Discount Rate IRR NPV Payback

Schedule A 10% 15.22% $675.0M 2022

12% 15.22% $348.6M 2024

Schedule B 10% 15.16% $601.9M 2024

12% 15.16% $302.0M 2025

2.3.2 Capital Cost Estimates

2.3.2.1 Project Capital Cost Summary – Schedule A

Eagle Downs’ project commitment capital cost estimate – Schedule A – is summarised in Table 2-3, as per the work breakdown structure (WBS).

Table 2-3: Project Commitment Capital Summary – Schedule A

WBS Level Project Commitment Capital Estimate FEL3/DFS ($,000,000)

1 2 3 WBS – Area Base Growth Subtotal Owner Costs

Risk Total

ED 0 0000 Eagle Downs $1,144 $53 $1,199 $20 $85 $1,327

ED 3 0000 Surface $199 $23 $223 $2 $20 $246

ED 4 0000 Underground $603 $9 $613 $16 $42 $695

ED 5 0000 CHPP $264 $19 $284 - $16 $300

ED 7 0000 Project services $77 $2 $79 $2 $6 $87

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Project commitment capital is defined as the capital commitments required during the project phase of Eagle Downs mine development. This is different to the project capital defined by JV participants for FEL3/DFS deliverables. Project capital is the capital spent until the first 100,000t of longwall coal are produced. The main difference is related to the longwall purchase. The second set of longwall equipment will be ordered as part of the longwall package but the majority of cashflow forecast for this equipment will impact after the longwall commences production, as this equipment will be required for the second longwall block. Project capital for Schedule A is shown in Table 2-4:

Table 2-4: Project Capital Summary – Schedule A

WBS Level Project Commitment Capital Estimate FEL3/DFS ($000,000)

1 2 3 WBS – Area Project Commitment Project Capital

ED 0 0000 Eagle Downs $1,327 $1,260

ED 3 0000 Surface $246 $246

ED 4 0000 Underground $695 $627

ED 5 0000 CHPP $300 $300

ED 7 0000 Project services $87 $87

2.3.2.2 Project Capital Cost Summary – Schedule B

Eagle Downs’ project commitment capital cost estimate – Schedule B – is summarised in Table 2-5, as per the WBS:

Table 2-5: Project Commitment Capital Summary – Schedule B


1 2 3 WBS – Area Base Growth Subtotal Owner Costs

Risk Total

ED 0 0000 Eagle Downs $1,140 $53 $1,193 $20 $85 $1,321

ED 3 0000 Surface $195 $22 $218 $2 $20 $240

ED 4 0000 Underground $603 $9 $613 $16 $42 $695

ED 5 0000 CHPP $264 $19 $284 - $16 $300

ED 7 0000 Project services $77 $2 $79 $2 $6 $87

The only variance in project commitment and project capital for Schedule B was the reduced capital costs associated with temporary power generation in surface infrastructure capital, due to Powerlink infrastructure still being available from March 2013. Schedule B project capital is shown in Table 2-6:

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Table 2-6: Project Capital Summary – Schedule B


1 2 3 WBS – Area Project Commitment Project Capital

ED 0 0000 Eagle Downs $1,321 $1,254

ED 3 0000 Surface $240 $240

ED 4 0000 Underground $695 $627

ED 5 0000 CHPP $300 $300

ED 7 0000 Project services $87 $87

2.3.3 Operating Cost Estimates

Operating costs for the project were developed from first principles and are summarised in Table 2-7 and Table 2-8, which show average costs over the life of the project:

Table 2-7: Schedule A Total Operating Costs

Operating Costs ROM$/ROMt ROM$/Prd t FOR$/Prd t FOB$/Prd t

Mine operating costs $27.48 $47.05 $47.05 $47.05

Surface operating costs $0.85 $0.85

CHPP operating Costs $11.66 $11.66

Support services $15.21 $15.21

Logistics and royalties $37.93

Total operating cost $27.48 $47.05 $74.77 $112.70

Table 2-8: Schedule B Total Operating Costs

Operating Costs ROM$/ROMt ROM$/Prd t FOR$/Prd t FOB$/Prd t

Mine operating costs $27.34 $46.80 $46.80 $46.80

Surface operating costs $0.83 $0.83

CHPP operating costs $11.70 $11.70

Support services $15.17 $15.17

Logistics and royalties $37.27

Total operating cost $27.34 $46.80 $74.50 $111.78

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2.4 Geology and Resource

Eagle Downs’ JORC resource estimate is 959 million tonnes

Target seams are HCU, HCL and DY in the Moranbah coal measures

Majority of reserves are classified as hard coking coal of similar quality to that at BMA’s Norwich Park mine.

2.4.1 Target Coal Seams

The HCU, HCL and DY seams of the Moranbah coal measures form the principal economic coal resources in the Eagle Downs resource area. Typical seam stratigraphy is shown in Figure 2-5:

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Table 2-9: Summary of In Situ Resources by Seam (depths from 150m to >600m)

Seam Measured Tonnes x 106

Indicated Tonnes x 106

Total Measured and Indicated Tonnes x 106

Inferred Tonnes x 106

Total Measured Indicated and

Inferred Tonnes x 106

Q 73 20 93 15 108

HCU 123 36 158 31 189

HCL 281 70 351 49 400

HCL ‘pci’ 3 3 8 11

DY 164 13 177 16 193

DY ‘pci’ 7 30 37 22 58

Total 648 171 819 140 959

2.4.3 Coal Quality

Coal quality was determined from an updated geology database and included into the XPAC model. The model can produce the average coal quality results by period or area and has produced tables for average coal quality by longwall block. Coal price discounts were applied to coal quality by period in the economic models.

2.4.4 Hydrogeology

Groundwater inflow modelling was completed as part of FEL3/DFS. Estimates of inflow to the mine workings were generally below 20l/s, with a few peaks of up to 28l/s occurring for short durations, due to the specific areas being mined and their proximity to previously mined areas and goaf inflow.

2.4.5 Geotechnical

During FEL3/DFS, there was emphasis on assessing various mine planning options relating to specific geotechnical parameters, including stress, joint and cleat orientation, and roof rib and floor conditions. IMC Solutions was asked to assess various mine layouts with regard to geotechnical risk and impacts.

Additional geotechnical analysis and assessments undertaken during the study included:

Coordination of field work and geotechnical logging and sampling

Detailed FLAC 3D evaluation of multi-seam stresses and impacts (for various mine layouts and orientations)

Numerical modelling to determine/validate roof and rib conditions and ground support requirements for development workings

Assessment of longwall face widths with respect to geotechnical impacts

Assessment of longwall shield specification for preliminary quotes and costing

Assessment of longwall top coal caving (LTCC) application

Assessment of likely subsidence impact.

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2.5 Surface Infrastructure

All major work packages were tendered during the FEL3/DFS study

Cost-effective surface infrastructure solution will enhance the Eagle Downs operation

Design of Eagle Downs’ surface and enabling infrastructure was developed as part of AECOM’s FEL3/DFS scope of works. During FEL2/FS, five coal handling plant and site layout options were considered. Based on agreed assessment criteria, the final surface layout was developed and optimised during FEL3/DFS. The final site configuration includes:

Mine-access road

Mine industrial area (MIA)

Site village accommodation

Mine-access drift box-cut and underground infrastructure areas

Coal handling and preparation plant comprising:

Surface and enabling infrastructure was divided into five major areas:

Site-wide bulk earthworks

High-voltage (HV) electrical infrastructure

MIA and site services

Rail loop

Site accommodation village.

Figure 2-6: Eagle Downs Surface Layout

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2.6 Underground Mining

Mine design was optimised during FEL3/DFS, taking into account 3D seismic results

Ventilation design was optimised to suit new mine plans and schedules

Gas management report recommended SIS pilot drilling program be completed

All major mining equipment was tendered

LOM production rates benchmarked against leading Australian longwall mines

Eagle Downs has estimated JORC reserves of 254 million tonnes

The Eagle Downs FEL3/DFS mine design process considered all available data and in particular, results of structural interpretation and floor grades in relation to FEL2/FS mine layout. The approach was to evaluate the final mine design from first principles and to develop a ranking process to determine optimal mine configuration and mine layout requirements.

2.6.1 Mine Access

The study considered various mine-access options; however, the FEL2/FS conclusion to adopt a drift to access target seams at the shallowest area of the resource was validated.

2.6.1.1 Drift Design Process

The proposed configuration comprises twin parallel drifts, from surface to the HCU seam at a grade of 1:7, with interconnecting cut-throughs at appropriate intervals. The benefit of this configuration will be that both drifts can be developed together, while a ventilation circuit can be established through the cut-throughs. The 1:7 grade was selected as the maximum to safely operate rubber-tyred diesel vehicles in a drift of more than 2km in length.

Surface excavation through weathered and unconsolidated material will be by box-cut to a depth of some 20m, after which it will be stabilised, covered and back filled.

2.6.2 Mining Layout

An extensive mine design evaluation process was completed, involving several presentations and workshops with EDCM, consultants and JV participants. The layout was developed to best suit the resource and to improve resource recovery and practicality.

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Figure 2-9: DY Seam Mine Layout

2.6.3 Ventilation

EDCM engaged Roy Moreby (Morvent Mining), a recognised industry leader in ventilation design and gas management, to deliver FEL3/DFS ventilation requirements for the Eagle Downs project. Roy has been involved with the project since its inception, completing the initial concept study in late 2008 and following up with the more detailed FEL2/FS study in April 2009.

The recent study provided confidence that the proposed mine design and production schedule can be practically and technically achieved within industry-accepted construction and safety standards. It was carried out in collaboration and consultation with other study providers, particularly Geogas – responsible for the gas emission and gas management part of the study – and Mine Consulting Services (MCS) – principal consultant responsible for underground mine design and schedule. The study and content was also peer reviewed by an independent underground coal mining consultant.

2.6.4 Gas Management

Gas and gas management, including methane drainage, will present significant hazards for the Eagle Downs project, both from safety and financial perspectives.

Extensive gas emission and gas management studies were completed by Geogas and Morvent Mining. The two worked collaboratively, with input from MCS, which prepared the final mine design and production schedule. The combined reports have given EDCM confidence that proposed gas mitigation and ventilation strategies can be established to provide a safe underground working environment, and that potential delays caused by excessive gas concentration in working faces will be minimised.

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2.6.4.1 Key Risks and Recommendations

Key gas-related project risks:

Pre-drainage will be required in all areas where gas content is above 5m3/t for control of rib emission and above 7m3/t for mitigation of outbursts risks

Permeability data at depths greater than 400m in the mine-plan area are sparse. The permeability/depth relationship derived from measured data suggests that the HCU and HCL seams at depths of 450m-plus will likely be difficult to drain

In the initial HCU and HCL development (TG100, MG100 and TG306), it will be important to provide for SIS pre-drainage well ahead of time to avoid gas constrained development, particularly in areas where gas contents exceed the recommended outburst threshold

Given the need to obtain at least two, preferably three to five years’ experience with SIS pre-drainage performance to optimise hole patterns, there will be risk to 100s and 300s area development (and longwall production) if the initial SIS program does not commence in an appropriate timeframe

Unless the Q seam is pre-drained prior to longwall extraction, very high goaf-drainage-capture efficiencies (>70%) will be required in some areas. Although technically feasible, without roof-seam pre-drainage, it is likely that longwall production will otherwise be gas constrained in HCU inbye 100 and all 300 areas

As a result of development and longwall gas emission predictions, as well as EDCM’s proposed production rates, a business risk was identified in attempting to extract 100s and 300s blocks on a two-heading gateroad basis. Subsequently, a high-ventilation capacity – supported by a proactive SIS with additional UIS – pre-drainage gas management approach is recommended.

2.6.5 Mining Equipment

Assessment of Eagle Downs’ equipment requirements was undertaken in collaboration with MineCraft Consulting, MCS and EDCM. MCS contributed the functional specifications and requirements from which MineCraft obtained quotations from suppliers on behalf of EDCM. The mechanical and electrical details of the proposed equipment were determined between MineCraft and EDCM to satisfy the approval requirements of the project. Major underground work packages included in the scope of supply are detailed in Table 2-10:

Table 2-10: Major Underground Work Packages

WBS Code Work Package Description Comments

ED.4.1000 Development equipment Continuous miners

Shuttle cars

Feeder/breakers

Panel auxiliary ventilation and electrical systems

ED.4.2000 Mobile diesel equipment Flameproof personnel transporters

Underground loaders and attachments

Non-flameproof personnel and materials transport

ED.4.3000 Underground services – electrical 11Kv surface and underground switchboards

Underground section circuit breakers

HV and LV substations

11kV boreholes

Communication systems and monitoring equipment

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WBS Code Work Package Description Comments

ED.4.4000 Underground services – mechanical

Compressed air system

Mine dewatering system

Diesel transfer, fluid reticulation, stone dust, ballast and concrete

ED.4.5000 Underground miscellaneous Includes main ventilation equipment, heat management, gas drainage plant and nitrogen inertisation plant

ED.4.6000 Underground coal clearance system

Includes drift conveyor, trunk conveyors, gateroad conveyors and surface stockpile conveyor

ED.4.8000 Longwall Complete 300m-wide longwall system, including some second sets of equipment and emulsion system, such as:

Powered roof support

Shearer

Pump station

Monorail

Electrics

AFC and BSL

2.6.6 Mine Planning

2.6.6.1 Mine Production Rates

Extensive analysis was undertaken to determine probable productivities for Eagle Downs in both development and longwall mining operations, using projected characteristics for each of the target seams (HCU, HCL and DY), as well as the operational methodologies of selected mining methods.

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Schedule Progress Plot (HCU Seam)

A progress plot for colour-coding areas mined on an annual basis is included in Figure 2-10:

Figure 2-10: Plan Progress Plot by Year – HCU Seam

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Schedule Progress Plot (HCL Seam)

A progress plot for annually colour-coding areas mined is included in Figure 2-11:

Figure 2-11: Plan Progress Plot by Year – HCL Seam

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Schedule Progress Plot (DY Seam)

A progress plot for annually colour-coding areas mined is included in Figure 2-12:

Figure 2-12: Plan Progress Plot by Year – DY Seam

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2.6.6.2 Life of Mine Production Scenarios

The LOM base-case schedule proposed for all three Eagle Downs target seams (HCU, HCL and DY) is summarised in Figure 2-13. This represents an expected LOM of 48 years.

Figure 2-13: LOM ROM Production for All Seams

2.6.7 Mine Operation

2.6.7.1 Owner/Contractor Task Breakdowns

Assumptions around allocation of some of the major tasks in the development sections are described in Table 2-11 and Table 2-12, respectively:

Table 2-11: Summary of Development Responsibility Assumptions

Task Eagle Downs Crews Contractor Crews

Gateroad driveage Possible use of contractors

Mains driveage Possible use of contractors

Panel advances

Ventilation control devices

Secondary support Some secondary support installed

by support crews

Drive-head installations

Fault driveage Minor faults developed by mine

Major faults developed by contractors, as required

Gas drainage

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

YR1

YR3

YR5

YR7

YR9

YR11

YR13

YR15

YR17

YR19

YR21

YR23

YR25

YR27

YR29

YR31

YR33

YR35

YR37

YR39

YR41

YR43

YR45

YR47

YR49

YR51

YR53

Tota

l RO

M T

onne

s

Total ROM ProductionCalendar Years

HCU Longwall ROM Tonnage HCU Development ROM TonnageHCL Longwall ROM Tonnage HCL Development ROM TonnageDY Longwall ROM Tonnage DY Development ROM Tonnage

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Table 2-12: Summary of Longwall Responsibility Assumptions

Task Eagle Downs Crews Contractor Crews

Longwall mining

Longwall relocations

Ventilation control devices

Secondary support Face bolt-up will be carried out by

the mine

Drive-head installations

Gas drainage

2.6.8 JORC Reserves Statement

MCS completed a revised Eagle Downs JORC compliant reserves statement in March 2011:

Table 2-13: JORC Reserves by Seam

Category ROM Tonnes (t) Percentage (%)

HCU Seam

Probable 13,531,272 18%

Proved 60,055,413 82%

JORC reserves 73,586,685 100%

HCL Seam

Probable 21,908,248 19%

Proved 91,117,439 81%


DY Seam

Probable 12,011,487 18%

Proved 55,447,748 82%


Total

Probable 47,451,007

Proved 206,620,600

JORC reserves 254,071,607

2.6.9 Project Expansion Case

Although not part of the FEL3/DFS scope of works, a concept expansion case has commenced, involving development of an XPAC schedule and underground cost model to include the following:

Expansion case commencing after project execution and being available for walk-off/walk-on longwall faces from LW102

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2.7 Coal Handling and Preparation Plant

CHPP will have a throughput of 1,200tph ROM to a standard consistent with a 50-year LOM

Overall plant yield is expected to be 71.6% on the HCU seam coal, with an ash target of 9.5% and moisture target of 11.5%

Capital cost estimate for the complete facility was subjected to a high-level risk review to determine the most likely project cost (P80) – A$306 million

Average LOM total operating cost was estimated at $6.81/ROMt

Construction duration will be 28 calendar months from project commitment.

2.7.1 CHPP Design

Design of the Eagle Downs coal handling and preparation plant (CHPP) was based on FEL3/DFS design criteria. Key design parameters for the generic CHPP included:

Design life: 50 years

Annual requirement: 52 weeks per year

Operating regime: seven days per week, 24 hours per day

Mechanical availability: >95%

Process utilisation: > 95%

Operating hours: > 7,000 hours per annum

Nominal CHPP feed rate: 1200tph

Dilution: 5%

Maximum yield: 80% coarse, 90% fines, 80% ultra-fine

Minimum yield: 23% coarse, 66% fines, 64% ultra-fine.

2.7.2 Raw Coal

The ROM stockpiling conveyor will discharge ROM coal from the underground drift onto a 150,000t (live stacking capacity) conical stockpile (live reclaim capacity is nominally 30,000t). The dozer push-out capacity will be constrained by the lease boundary, drift conveyor trestle locations, site-access roads and nearby drainage channels. A logistics model is recommended for future works to confirm stockpile capacities.

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Figure 2-15: Raw Coal Handling System

2.7.3 Coal Preparation Plant

The feed conveyor will transfer coal from the raw coal surge bin to the CHPP (Figure 2-16).

Figure 2-16: CHPP and Adjacent Structures

Raw coal stockpile

Rotary breaker station and ROM rejects stockpile

Raw coal surge bin

Plant feed conveyor

Raw coal transfer conveyor

Raw coal stockpile

Rotary breaker station and ROM rejects stockpile

Raw coal surge bin

Plant feed conveyor

Raw coal transfer conveyor

Floc plant Magnetite pit

Thickener

2-stage flotation cells

HBF units

Product conveyor

Coal preparation plant (CPP)

Rejects conveyor

Tailings dewatering

building

Floc plant Magnetite pit

Thickener

2-stage flotation cells

HBF units

Product conveyor

Coal preparation plant (CPP)

Rejects conveyor

Tailings dewatering

building

MAY 2011 PAGE 58 OF 594


2.7.4 Coal Circuits

2.7.4.1 Coarse Coal Circuit

Figure 2-17: Simplified DMC Configuration

2.7.4.2 Fine Coal Circuit

Figure 2-18: Simplified Fine Circuit Configuration

2 x DMC Feed Sumps

2x DeslimingScreens

2x DMCs

Common RejectScreen

2x Product Screens

To Fine Coal Circuit

-1.4 mm (ww)

Rejects Conveyor

Product Conveyor

-50 mm

To Correct Medium Sump

To Dilute Medium Sump

Coarse Coal Centrifuges

Plant Feed

2 x DMC Feed Sumps

2x DeslimingScreens

2x DMCs

Common RejectScreen

2x Product Screens

To Fine Coal Circuit

-1.4 mm (ww)

Rejects Conveyor

Product Conveyor

-50 mm

To Correct Medium Sump

To Dilute Medium Sump

Coarse Coal Centrifuges

Plant Feed

Desliming Cyclones

ThickeningCyclones

Desliming Cyclone Feed Sump

Fine Product Sump

FromDeslimingScreens

To Flotation

Fine CoalCentrifuges

Sieve Bend

Reflux Classifiers Feed Sump

Reflux Classifiers

To HF Screen

Product Conveyor

To DeslimingScreen

Desliming Cyclones

ThickeningCyclones

Desliming Cyclone Feed Sump

Fine Product Sump

FromDeslimingScreens

To Flotation

Fine CoalCentrifuges

Sieve Bend

Reflux Classifiers Feed Sump

Reflux Classifiers

To HF Screen

Product Conveyor

To DeslimingScreen

MAY 2011 PAGE 59 OF 594


2.7.4.3 Ultra-Fine Coal Circuit

Figure 2-19: Simplified Flotation Circuit Configuration

Tailings Circuit

Figure 2-20: Simplified Tailings Circuit Configuration

Sieve BendUnderflow

Primary Flotation Feed Sump

PrimaryJameson Cell

Tailings Thickener

To Tailings Filters

Desliming Cyclone Overflow

Secondary Flotation Feed Sump

SecondaryJameson Cell

Product Conveyor

Horizontal VacuumBelt Filters

Sieve BendUnderflow

Primary Flotation Feed Sump

PrimaryJameson Cell

Tailings Thickener

To Tailings Filters

Desliming Cyclone Overflow

Secondary Flotation Feed Sump

SecondaryJameson Cell

Product Conveyor

Horizontal VacuumBelt Filters

Tailings Thickener

Flotation Tailings

Belt Press Filters

Rejects Conveyor

Tailings Filtrate Sump

Tailings Filter Feed Sump

Clarified Water Sump

Tailings Thickener

Flotation Tailings

Belt Press Filters

Rejects Conveyor

Tailings Filtrate Sump

Tailings Filter Feed Sump

Clarified Water Sump

MAY 2011 PAGE 60 OF 594


2.7.5 Product Handling and Train Loading

Product coal will be stacked by a radial stacker providing approximately 100,000t live stacking capacity and 10,000t live reclaim capacity (equivalent to a single train) in lieu of the fixed arrangement outlined in FEL2/FS.

Figure 2-21: Product Handling System

During train loading, product will be reclaimed from the stockpile by two pairs of coal valves in a precast concrete tunnel and discharged directly onto the train loadout conveyor.

Figure 2-22: Product Reclaim and Train Loadout System

2.7.6 Reject Handling and Tailings Processing

CHPP reject will be conveyed to a 400t reject bin for disposal via trucks. The working volume of the rejects bin will hold just over one hour nominal CHPP rejects production.

Figure 2-23: Rejects Handling System

CPP

Product conveyor

TLO bin

Product stockpile

Product stacker

Product stacker transfer station

Elevated conveyor section to cross Q100 flood zone

Two-stage product sampler

CPP

Product conveyor

TLO bin

Product stockpile

Product stacker

Product stacker transfer station

Elevated conveyor section to cross Q100 flood zone

Two-stage product sampler

TLO binMain electrified

rail lineProduct stockpile Product

stacker

TLO conveyor

TLO binMain electrified

rail lineProduct stockpile Product

stacker

TLO conveyor

Rejects conveyor

Rejects bin

Rejects stockpile Sampler

Conveyor takeup tower and drive station

Tailings dewatering building

CPPRejects

conveyor

Rejects bin

Rejects stockpile Sampler

Conveyor takeup tower and drive station

Tailings dewatering building

CPP

MAY 2011 PAGE 61 OF 594


2.7.7 Dry Rejects Emplacement Area (DREA)

CHPP reject will be transported to the DREA by truck. Golder Associates was engaged to perform preliminary design of the 50-year LOM (110Mm3) DREA.

Figure 2-24: DREA Location

DREA

CPP area

Service corridor

Main rail line

DREA

CPP area

Service corridor

Main rail line

MAY 2011 PAGE 62 OF 594


2.8 Approvals

All approvals have been secured bar the Mining Lease, which is expected to be granted in June 2011.

Table 2-15: Key Approvals for Project Execution

Approval Legislation Approval Body

Status

Final EA EP Act DERM Issued on 28 March 2011

Mining Lease MR Act DEEDI Expected to be granted in June 2011

EPBC Act Assessment EPBC Act DEWHA Expected to be granted in June 2011

Plan of Operations EP Act DERM To be submitted prior to project commencement

Approved CHMPs ACH Act DERM Executed and registered with DERM

Design of access road to ML and turn off from Winchester Road

Local planning

Isaac Regional Council

Preliminary discussions – required prior to construction of turn off

Water pipeline easement crossing

N/A SunWater Engineering designs provided to SunWater. Awaiting feedback and approval

Electricity transmission easement crossing

N/A Powerlink Engineering designs provided to Powerlink. awaiting feedback and approval

Queensland Rail Contracts and Agreements

Access agreement N/A QRN Standard regulated document – once EDCM enters into negotiation for access to QRN

Connection agreement N/A QRN Commercial terms of entry and exit to QRN. We continue to request a draft of this document but are yet to receive it

Access Facilitation Deed (AFD)

N/A QRN This contract establishes the framework around funding the QRN connection. Draft not received

Rail Infrastructure Construction (RIC) deed

N/A QRN Establishes the framework around the construction of connection to the QRN. Draft not received

Conveyor license N/A QRN Licence to build a conveyor over the QRN. Draft received

Crossing deed N/A QRN Build, operation, management of a level crossing. Draft not received

Rail haulage agreement N/A QRN This agreement secures above-rail-capacity trains. The competitive process to secure an operator has commenced

Maintenance agreement N/A QRN Maintenance. Not to be negotiated until into the construction phase

Rail Infrastructure Management Deed

N/A QRN Railway manager and train controller. Not to be negotiated until into the construction phase. QRN is likely to be the preferred supplier

Bridge license N/A QRN If the grade separation is required. Draft received.

MAY 2011 PAGE 63 OF 594


2.9 Risk Management

The project has no fatal flaws or extreme risks

Business risk analysis identified 59 risks for each schedule option

Schedule A features two extreme risks relating to delay in project approval and contracted logistics not being available

Mitigation strategies have been developed for all risks

2.9.1 Fatal-Flaw Analysis

Fatal-flaw analyses conducted during both FEL1/PFS and FEL2/FS were reviewed to assess project risks and to identify if any fatal flaws existed within known project options in the current operating and stakeholder involvement. The analyses predominantly assessed engineering, community, environmental and land-rights risks. No fatal flaws were identified.

2.9.2 Business Risk Register

EDCM engaged Marsh Pty Ltd (Marsh) to facilitate development of a business risk review/profile for the Eagle Downs coal project. Specifically, the purpose was to identify and assess business risks so as to provide EDCM with a high-level overview and assessment of identified risks under each project delivery schedule. Furthermore, it will assist in prioritisation of risk improvement strategies, as well as gain better alignment within the project’s overall strategic objectives.

Some 59 risks were identified in the review and assessed as having the potential to impact the Eagle Downs project under each of the considered delivery schedules. The spread of risks is as follows:

Table 2-16: Eagle Downs Risk Spread

Risk Rating Schedule A Schedule B

Project Sanction Now (i.e. prior to rail/port capacity being secured)

Project Sanction Later (i.e. only when rail/port capacity is secured)

Extreme 2 0

High 11 14

Medium 14 12

Low 18 20

Not rated 14 13

Extreme risks include:

Table 2-17: Extreme Risks

Schedule Ref Risk Description Risk Rating

A 3.1 Delay in project approval affects critical path E1

9.1 Contracted logistics not available for developmental coal (rail, port)

E1

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2.9.3 Study Risk Assessments

Technical risks assessments were conducted for the following studies, utilising EDCM’s Risk Framework Standard 3.2:

Underground

CHPP

Surface

Human resources (HR).

A total of 81 risks were identified and assessed using methodology based on AS4360 Risk Management Standard. For each identified risk, a qualitative total risk review was conducted. Table 2-18 summarises the analysis of the number of risks identified for each risk register:

Table 2-18: Summary of Risk Register Results with Current Controls

Risk Ranking Underground CHPP Surface HR

Extreme 0 (0%) 0 (0%) 0 (0%) 0 (0%)

High 5 (42%) 5 (13%) 20 (39%) 12 (63%)

Medium 7 (58%) 8 (22%) 20 (39%) 7 (27%)

Low 0 (0%) 24 (65%) 11 (22%) 0 (0%)

Total 12 (100%) 37 (100%) 51 (100%) 19 (100%)

2.9.4 Construction Insurances

The term ‘principal-controlled insurance’ means the arrangement by which the principal or owner takes construction risks and public liability insurance on behalf of the contractor, subcontractors and principal. The main advantages for EDCM include:

Influencing arrangements and costing of the covers

Avoiding additional costs of contractor mark-up in contract negotiations

Dovetailing the construction insurance program to EDCM’s permanent insurance program

Reducing risk of uninsured losses, particularly on major projects where there are a number of contractors/subcontractors on the contract site

Minimising control problems by effecting its own insurances

Reducing the risk of contractor/subcontractor disputes, as there will be only one policy in place for all parties. This will be particularly important in the case of liability claims

Receiving direct payment of claims, which will negate contractors’ ability to withhold funds.

The construction insurance markets in Australia, London and Asia have been competitive for a number of years due to significant capacity. In the absence of any market changing losses, this is expected to continue for the foreseeable future. While there have been significant events of damage by flood and other weather-related events in recent times, Marsh has not seen these events impact the insurance market as yet. Marsh will continue to monitor this and advise EDCM if there is a deterioration of the competitiveness of the insurance market for construction projects.

MAY 2011 PAGE 65 OF 594


2.10 Operations Management

Eagle Downs is a potential top-tier longwall mining operation

EDCM has extensive experience at all levels of the underground mining business, gained from top-tier mines around the country

EDCM will differentiate Eagle Downs to attract high-calibre employees in a tight market.

2.10.1 Operating Philosophy

Eagle Downs has been designed to compete with the top tier of Australian longwalls. The country’s top four mines in 2010 – Oaky North, Newlands, Moranbah North and Oaky No.1 – are all in Queensland and have similar extraction heights to Eagle Downs, as well as similar longwall and conveyor capacity and technology. Eagle Downs’ position relative to Australia’s top longwalls in 2010 is shown in Table 2-19. However, these mines have demonstrated significant performance improvement over the last five years, indicating that Eagle Downs’ relative position will have dropped by the time construction and development of the first longwall has been completed.

Table 2-19: Australia’s Top Longwalls in 2010

LW Rank Mine State Longwall

1 Oaky Nth Qld 8,214,000

2 Newlands Northern Qld 7,825,000

3 Moranbah Nth Qld 5,305,200

4 Oaky No.1 Qld 5,294,000

Eagle Downs Schedule A 2015/16 Qld 5,137,336

5 Kestrel Qld 5,116,800

6 Mandalong NSW 4,855,200

7 Ulan NSW 4,794,100

8 Crinum East Qld 4,637,400

9 North Wambo NSW 4,564,800

10 Beltana, Blakefield South NSW 3,665,800

Source: International Longwall News

The Eagle Downs project team has extensive operational experience in the top-four performing longwall mines, as well as from North Goonyella and Broadmeadow, also in the Moranbah coal measures. The team’s experience and know-how has been used throughout FEL3/DFS to ensure that study providers’ work can be appropriately applied to Eagle Downs, and is achievable. This experience and know-how will be fundamental to the detailed design that the team will ultimately operate and manage. Fundamentals of operation include:

Continuously seeking excellence in production and support activity

Processed-based organisation – longwall, development, outbye and services, surface

MAY 2011 PAGE 66 OF 594


Activity 24 hours per day, 363 days per year

Seven-on/seven-off production and maintenance roster

Two overlapping 12-hour production shifts per day

One maintenance window per day (with production capability should conditions dictate continuous production)

10-hour shifts for first and last shifts of each tour

– Aids fatigue management

– Provides an extended scheduled maintenance period

All routine work undertaken by Eagle Downs employees

Contract labour used for infrequent work, such as conveyor installations and longwall moves, and for specialist works, such as installation of rated ventilation devices and some maintenance activities

Site-based managerial support and leadership of operational excellence

Brisbane-based transactional, commercial and HR functions, industry engagement, JV management and strategic planning.

2.10.2 Human Resources

Central Queensland’s labour market is tightening, so EDCM aims to differentiate Eagle Downs by:

Promoting its brand in the future labour market by living its values during construction

Ensuring contractor agreements for construction are aligned with EDCM values and do not introduce legacies that will be detrimental to the operational phase of the mine

Construction management by future operational leaders

Offering choice of home location:

– Fly-in/fly-out of southeast Queensland

– Drive-in/drive-out of coastal central Queensland

– Residential in Moranbah with rental assistance

Acknowledging the needs of current employment generations (Baby Boomers and Generation X) and new employment generations (Generations Y and Z) in recruitment, learning and development, and communication and involvement.

The Eagle Downs mine location is seen to offer significant advantages to employees at the major underground mining centres of German Creek and Oaky Creek. The mine should also be positioned to provide opportunities for underground workers as Brisbane tunnelling project reach their conclusion.

Ensuring that employees have the necessary skills for their work will be a significant factor in the mine’s success. Employees will be a mix of workers with prior underground experience and those who are new to the industry. Past experience will be from many mines with differing conditions, equipment and managerial/leadership styles. Eagle Downs management will draw on this experience in developing operating plans and procedures. While this may not be the way that employees have worked previously, the Operational Readiness Manager and the operations team will develop and implement programs to induct all employees into the Eagle Downs way of work, while performance management tools will be used to ensure that those with prior experience are embracing and embedding the Eagle Downs way and assisting to up-skill others.

MAY 2011 PAGE 67 OF 594


A two-year drift driveage duration will enable EDCM to work with the contractor to introduce some initial Eagle Downs coal development workers to the mine through the contractor. It is otherwise intended to engage Eagle Downs crews three months prior to commencement of their roles.

2.10.2.1 Personnel Levels

EDCM developed manning to ensure that Eagle Downs roles and responsibilities, remuneration and development, and progression of employees will be aligned with the company’s HR strategy.

Organisational Structure

A traditional but proven organisational structure is proposed, with all typical functions covered, as per many established mines’ organisational structures. Support functions will be categorised within two departments, with a dedicated function of contracts accountability. The structure was developed to include six hierarchical levels of reporting, from the General Manager/Site Senior Executive (SSE) to operator and tradesperson level.

Some 380 employees will be based onsite with total personnel, from manager to crew level but excluding contractors, indicated in Table 2-20:

Table 2-20: Summary of Site Personnel Makeup

Site Function Employees

Operations support team 92

Production team 214

Engineering team 13

CHPP team 38

Employee support team 11

Contracts team 10

SSE and assistant 2

Total 380

MAY 2011 PAGE 68 OF 594


2.11 Marketing and Logistics

EDCM has identified rail and port options

Two schedules have been developed to incorporate port capacity security

Market research has identified major integrated steel companies and merchant coke producers for future marketing focus.

2.11.1 Logistics

While Eagle Downs has not yet secured rail and port capacity, logistics possibilities include:

Ad hoc access to contracted but unused port and rail capacity

Re-assignment of contracted but unused port and rail capacity

Contracts for capacity at new ports (and rail contracts for upgraded capacity to complement the new port capacity).

Shipping through new capacity resulting from the Dalrymple Bay Coal Terminal (DBCT) expansion should offer the cheapest long-term rail and port solution for Eagle Downs. The project is well positioned in the capacity queue for DBCT but the timing and cost of the expansion are uncertain and capacity will not be available for the early years of production.

Wiggins Island Coal Export Terminal (WICET) is likely to be a more expensive long-term option for Eagle Downs by virtue of the railing distance to the port. It should be noted that Carborough Downs railed some 500,000t over three months across the Goonyella system to Gladstone in 2008. Carborough is further from Gladstone than Eagle Downs. EDCM is participating in the WICET Stage 2A study, which is likely to provide port capacity some 18 months earlier than DBCT.

EDCM believes that there are a number of operators that, through changing plans or mine underperformance, are overcommitted to existing rail and port capacity. Assignment of this surplus could provide Eagle Downs with capacity until new port and rail capacity is secured. Unfortunately, operators are not acknowledging their surplus to EDCM and it is believed they regard any surplus as a commodity that can be better traded on the short-term market.

Ad hoc rail and port capacity does become available on a short-term basis. Eagle Downs’ rail loadout design will allow the mine to rail to existing and at Gladstone ports, Dalrymple Bay or Abbot Point. The expansion of Abbot Point in 2012 and the new WICET in 2015 may increase availability of ad hoc capacity.

After extensive research, EDCM developed two schedule scenarios:

Schedule A

Project sanction before contracts for port and rail capacity are secured (contracted or re-assigned)

Development coal reliant on ad hoc or re-assigned capacity

Longwall coal aligned with commissioning of first available new capacity (WICET Stage 2A).

MAY 2011 PAGE 69 OF 594


Schedule B

Project sanction upon financial close of the first available new capacity (WICET Stage 2A)

Development coal not before first available new capacity commissioned.

2.11.2 Marketing

Marketing does not form part of EDCM’s scope. However, the DFS/FEL marketing study identified major integrated steel companies and merchant coke producers (Table 2-21) for attention in marketing strategies:

Table 2-21: Target Customers

Country/Region Company

Japan Nippon Steel, JFE Steel, Sumitomo Metal Ind, Kobe Steel and Nisshin Steel, Mitsubishi Chemicals

South Korea POSCO, Hyundai Steel

China Baosteel, Shougang (Capital Steel), Wuhan, Benxi and others

Taiwan China Steel (incl. Dragon Steel)

India SAIL, Tisco (Tata), RINL (Vizag), JSW, BLA, Gujarat, Saurashtra Fuels

Brazil ArcelorMittal-CST, ThyssenKrupp-CSA, Usiminas-Cosipa, CSN, Gerdau, Vale (Alpa, CSP, CSU)

France, Belgium, Spain and former Eastern Europe

ArcelorMittal

UK and Netherlands Tata-Corus

Germany ThyssenKrupp (and HKM), Salzgitter

Sweden & Finland SSAB, Rautauruukki

Turkey Erdemir – Kardemir

South Africa ArcelorMittal

Source: MinAxis

MAY 2011 PAGE 70 OF 594


2.12 Sustainability

Safety and environmental legislative requirements have been identified and addressed

SHMS and EMP have been developed and will be improved during project execution

Community engagement strategy has been developed to mitigate social impacts on identified external stakeholders

Climate change and energy efficiency options have been included in design.

2.12.1 Safety and Health Management System

EDCM has developed, documented and implemented a comprehensive Safety and Health Management System (SHMS) for current Eagle Downs exploration activities. The system has been designed to accommodate continuous improvement and expansion through the project’s various development stages, up to and including mine operation. The SHMS formalises systems, standards, methods and procedures in use or to be introduced, to ensure that EDCM identifies and mitigates risks associated with principle and other hazards, and to maintain compliance with relevant legislation.

The Queensland Coal Mine Safety and Health Act requires the SHMS to be developed using risk-based principles by a cross-section of the workforce. For a greenfield operation, the SHMS can only be developed as the operation progresses. The Project Execution Plan (Annexure 1) provides details of the implementation plan process. 2.12.2 Social Impacts and External Relations

Existing social issues in the Moranbah community can largely be attributed to expansion of the local coal mining industry. Resulting impacts include coal industry reliance on block shifts and fly-in-fly-out (FIFO)/drive-in-drive-out (DIDO) workforce arrangements, and prevalence of accommodation centres (single persons’ quarters).

Dominant community issues relate to:

Housing and accommodation

Accessibility to community services and facilities

Local community identity and vitality

Labour force and skill shortages.

Eagle Downs’ cumulative contribution to these social impacts will be managed and potentially, mitigated by the EDCM Community Engagement Strategy (CES). CES initiatives will ensure that EDCM continues to work and consult with local stakeholders when making decisions that could impact the surrounding community.

2.12.2.1 Cultural Heritage

The Barada Barna People were identified as the Aboriginal party for the project in accordance with the Aboriginal Cultural Heritage Act 2003 (ACH Act). EDCM and Barada Barna have developed and executed a Cultural Heritage Management Plan (CHMP), which has been registered under the ACH Act.

MAY 2011 PAGE 71 OF 594


2.12.3 Environmental Management Plan

The Eagle Downs Environmental Management Plan (EMP) was approved under the EP Act on 14 December 2010. The EMP outlines the project’s Environmental Authority (EA) conditions, as well as environmental impacts identified in the EIS and corresponding proposed mitigation and management strategies. Many of EDCM’s mining activities will require specific management actions to reduce the risk of environmental harm. Subsequently, mitigation measures will include best-practice:

Rehabilitation techniques

Erosion and sedimentation control

Waste and land contamination management practices

Surface water and mine water management

Dust and noise monitoring

Vegetation clearing procedures

Weed and feral animal management.

2.12.3.1 Energy Efficiency

EDCM engaged Energetics to complete an energy efficiency study for the FEL3/DFS design. As an overriding principle, EDCM requested that each design contractor (AECOM – surface facilities, Sedgman – CHPP and MCS/MineCraft – mining) incorporate energy efficiency considerations into their design. Energetics was tasked with collating the results and providing a fourth-party analysis of each contribution towards best-practice energy use, as well as assessing the project’s future ability to meet statutory energy and greenhouse gas obligations. The review process, which addressed these considerations and introduced additional opportunities, supports EDCM’s strategic commitment to delivering best-possible ‘commercial’ practice in energy and resource use at the Eagle Downs operation throughout LOM.

2.12.3.2 Climate Reporting

Based on currently available energy and greenhouse statistics, Energetics was asked to clarify the schemes that will be triggered by Eagle Downs operations and what EDCM’s subsequent obligations will be at both a corporate and/or site level. Existing programs include:

Energy Efficiency Opportunities (EEO)

National Greenhouse and Energy Reporting (NGER)

Queensland Smart Energy Savings Program (SESP).

Energetics reviewed all relevant Australian programs and Table 2-22 summarises EDCM’s compliance obligations in relation to these programs:

Table 2-22: EDCM Energy Compliance Obligations

Reporting or Compliance Regime EDCM

Energy Efficiency Opportunities (EEO) 2014

National Greenhouse and Energy Reporting (NGER) 2012

Qld Smart Energy Savings Plans (SESP) 2011

EDCM’s obligation to satisfy Qld SESP program requirements will be voided when the project registers for the purposes of EEO.

dfs section 2 executive summary

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