Stanmore Resources is expanding its footprint over central Queensland coal operations.
It’s inked a deal to buy South32’s 50 per cent share of the shovel-ready Eagle Downs metallurgical coal project.
That’s not all. There’re negotiations in full swing to increase its stake of the Aquila mine from the co-owner.
They’re also horse trading to buy an 80 per cent interest in the neighbouring Eagle Downs South tenement.
Eagle Downs is ready for immediate construction said Stanmore.
The company described it as having ‘two underground access drifts partially completed before the site went into care and maintenance in late 2015’.
Stanmore chief executive officer and executive director Marcelo Matos says the acquisition of Eagle Downs is consistent with Stanmore’s ambition to expand its footprint in Queensland’s premium metallurgical coal basin.
Mr Matos says, ‘Eagle Downs is a high-quality project underpinned by a substantial resource base, which provides an exciting development opportunity that is complementary to our broader portfolio and in close proximity to our existing operations.’
“We believe we can bring our strong technical capabilities, as well as unique infrastructure and logistics portfolio, which will enable Stanmore to unlock the full value potential of Eagle Downs and provide a capital-efficient pathway for any future development decision.”
The company will pay South32 $US15 million (about $AU23 million) upfront for its 50 per cent stake in the joint venture project and $US20 million (about $AU30 million) upon the first 100,000 tonnes of coal being mined from longwall mining methods.
The consideration also includes future royalty payments linked to coal price thresholds.
Completion of the transaction is expected by the end of 2Q 2024, following the satisfaction of conditions precedent.
Long wall mining
Eagle Downs boasts a resource base of 1140Mt of resources and 292Mt reserves.
Previous studies indicate the potential to produce 4-6Mtpa of high-quality, low-volatile hard coking coals via longwall mining.
Eagle Downs lies directly south of Stanmore’s Isaac South (EPC755) exploration permit and close to Stanmore’s existing Bowen Basin operations.
Mr Matos says Stanmore is uniquely positioned to leverage infrastructure at Poitrel and Isaac Plains to develop the project including their company’s existing rail and port capacity.