January 28, 2013 / 11:21 PM / 5 years ago

Australia's coal mines hit by heavy rains, flooding

SYDNEY, Jan 29 (Reuters) - Heavy tropical rains have inundated Australia’s eastern coalfields, among the largest in the world, cutting rail haulage lines and halting production.

Emergency officials said the floods were severe, although not as widespread as the monsoon-like rains that saturated the region in 2011.

Between 200 and 400 millimeter’s fell over Queensland state’s Bowen Basin, home to giant open pit mines owned by BHP Billiton <BLT.L., Mitsubishi Corp, Anglo American Peabody Energy and others.

BHP said it was assessing the impact of the rains on its collieries and would issue a statement later on Tuesday.

A tropical low moving south along Queensland’s coast was causing the flooding. At this stage, there was only a very low likelihood the system would strengthen, according to the Australian Bureau of Meteorology.


A levee bank surrounding the Middlemount mine was breached and water flowed into the open cut, according to part owner Yancoal.

Production from the mine is likely to be affected for at least three weeks, although Yancoal could not say for certain.

Peabody Energy and Yancoal Australia are joint owners of the mine.

Separately, production was suspended at Yancoal’s Yarrabee mine at the weekend but was expected to resume this week.

Yancoal said it didn’t expect the Yarrabee mine’s production for the quarter to be affected by the suspension.

Australia is the world’s largest metallurgical coal exporter, accounting for roughly two-thirds of global trade.

It is also a major supplier of thermal coals, used in power generation.

Transport group Aurizon Holdings Ltd was forced to shut parts of its freight rail operations late last week which transport coal to the port of Gladstone, a key export terminal on the eastern seaboard.

Cyclones and rain during the 2010-2011 season forced dozens of companies to evacuate flooded coal mines and wiped out a significant amount of production for much of the year.

The immediate impact then was a sharp rise in coal prices.

Spot coking coal prices on Tuesday were pegged at over $167 per tonne, above the most recent quarterly settlement of $160 per tonne.

Australia’s cyclonic storm season runs from Nov. 1 to April 30.

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