UPDATE 1-QR National reopens rail lines after weekend rain

Sun Dec 12, 2010 11:29pm EST

* Speed restrictions in place on Blackwater, Goonyella

* Port vessel queues increase (Adds detail)

By Rebekah Kebede

PERTH, Dec 13 (Reuters) - Australian rail-freight firm QR National said Monday its Blackwater and Goonyella rail lines in Queensland state are back in operation after heavy rains shut them down over the weekend, but speed restrictions remain in place.

QR National's rail lines, which are a key link between Queensland's coal mines and its coal export terminals, have had disruptions for two weekends in a row due to unseasonably wet weather.

Queensland's $39 billion-a-year mining industry produces mostly coking coal which is exported to be used in steel-making, but some mines also produce thermal coal used in power generation. Queensland's ports currently have an annual coal export capacity of 225 million tonnes per annum.

The wet weather has slowed exports, with several companies declaring force majeures as the rains have slowed output from open cut mines and transport from coal mines to ports.

At the Dalrymple Bay Coal Terminal in the Port of Hay Point, coal is available for only eight of the 42 vessels currently waiting, according Greg Smith, the terminal's general manager of operations.

Last week, Gladstone Port Corporation said several companies shipping coal out of its port had declared force majeure. The port showed 26 vessels waiting off the port on Monday, up from 23 on Friday.

On Monday, Wesfarmers announced that metallurgical coal output from its Curragh mine would fall due to the impact of the rains. The company has had a force majeure on all exports and domestic contracts since Dec. 2.

Several other mines, including Xstrata's Rolleston, Macarthur Coal's Coppabella and Moorvale, Aquila Resources and Vale 's Isaac Plains, and Ensham, have also declared force majeure.

Companies typically declare force majeure when they cannot honour legal contracts due to unforeseen acts they cannot control.

QR National said its Moura and Newlands rail systems continue to operate. (Reporting by Rebekah Kebede; editing by Balazs Koranyi)