TAROOM COAL PTY LTD ABN: 16 079 251 442 TAROOM COAL PROPRIETARY LIMITED (ABN 16 079 251 442) ELIMATTA PROJECT UPDATE TO THE PROJECT APPLICATIONS SUPPORTING INFORMATION September 2015 1.0 INTRODUCTION 1.1 PURPOSE OF DOCUMENT This document is prepared in response to a request from the chief executive of the Department of Natural Resources and Mines (DNRM), pursuant to section 386J of the Mineral Resources Act 1989 (Qld) (MR Act) dated 28 July 2015 (DNRM Request). This document provides additional information supporting the mining lease applications (MLAs) 50254, 50270 and 50271 (Project MLAs) as requested in the DNRM Request. The information in this document prevails to the extent of any inconsistency with the supporting information initially provided to DNRM in 2009 in respect of the Project MLAs. 1.2 PROJECT OVERVIEW Taroom Coal Proprietary Limited ABN 16 079 251 442 (Taroom Coal) has made the Project MLAs which comprise the Elimatta Mine Project (Project). MLA 50254 was made over Exploration Permit for Coal (EPC) 650 in June 2009 for the purpose of coal mining operations and activities. This application was made under section 234(1)(a) of the MR Act. MLA 50270 was made over part of EPC 1171 and Prospecting Permit (PP) 50815 in December 2009. The part of the application within PP50815 was abandoned in February 2013 when agreement could not be reached with the underlying EPC holder. MLA 50270 is an application for a specific purpose mining lease (ML) under section 234(1)(b) of the MR Act. MLA 50271 was made in December 2009 and is an MLA for transportation under section 316 of the MR Act. MLA 50271 is made over the area of land that joins EPC 1171 with EPC 650 to support development of the Project. Page 1 of 23
The Project is located in the Western Downs Regional Council area in southern inland Queensland, approximately 35 km west of Wandoan and 380 km north-west of Brisbane. Access to the Project area from Wandoan at the Leichhardt Highway is via the Jackson Wandoan Road to Bundi Road thence to Perretts Road; also known as the Yuleba-Taroom Road. The Project s location is shown in Figure 1. Figure 1: Elimatta Mine Project Location Page 2 of 23
Supporting Information as part of Section 15 of the Project MLAs was provided in 2009. Since then much work has been carried out to improve the definition of the Project, including: Additional exploration programs to provide data to incorporate into the geological models for mine planning and scheduling; Coal analysis and processing test work to provide data for processing design; Base design for the Project infrastructure, including the rail transport connection to the Surat Basin Rail corridor; Studies to support the Project Environmental Impact Statement (EIS); Preparation and presentation of the EIS; Public submissions stage of the EIS assessment process; Revised EIS and Response to Comments (RTC); Preparation of the Project Environmental Management Plan (EMP); and Extensive consultation with interested and/or affected parties, including local authority and State representatives, landowners and other resource companies. Other factors external to the Project but having the potential to have a significant influence on the Project include: New Hope Corporation Limited (NHC) takeover of Northern Energy Corporation Limited (NEC) in 2011 see section 1.2 below; NHC purchase of the North Surat MLA and EPC assets of Cockatoo Coal Pty Ltd in 2015, whereby it acquired the Collingwood, Taroom and Woori project areas see Figure 2; The significant change in the market dynamics for sea-borne traded thermal coal; The change in development status i.e. slowdown - of the Wandoan Project and the Surat Basin Rail Project; and The transition of the coal seam gas (CSG) activities in the area from, largely, development and construction to operations and production. Page 3 of 23
Figure 2: New Hope Corporation North Surat Properties The Project consists of the development of a 259 million tonne (Mt) thermal coal resource (JORC 2004 compliant) of the Juandah formation in the Surat Basin, South East Queensland, Australia. The Project is planned to mine up to 8.2 Mt of Run of Mine (ROM) coal per annum (pa) (average ~7.5 Mtpa), by open cut methods to produce on average 5 Mtpa of product coal for export. Project production life is anticipated to be more than 30 years based on current economic assessment of the resource. Subject to the grant of the MLAs and Environmental Authority (EA) for the Project, the construction period on site prior to the start of coal production is anticipated to be 22-24 months with the first mine excavation activities site preparation and drainage management commencing after 13 months. Site construction activities will commence after grant of the MLs and once contractual arrangements are well progressed or in place for off-site supporting infrastructure requirements and services for rail (construction and operation), water and power. The Project will involve open cut mining using truck and excavator methods on MLA 50254. Topsoil stripped prior to mining will be stockpiled for later use in rehabilitation. Overburden will be relocated from above the coal seams to in-pit dumps, and in out-of-pit spoil dumps located on site and contiguous with the pit excavations. ROM coal will be transported in mine trucks along a purpose built haul road within MLA 50271 for processing on MLA 50270. A coal handling and preparation plant (CHPP) and associated mine infrastructure workshops, offices, train loader and rail balloon loop and waste storage areas - will be constructed on MLA Page 4 of 23
50270. Processing will involve crushing, screening and washing to separate coal from waste materials. Waste rejects will be de-watered, with water recycled to the processing plant and solids disposed of within specially constructed storage areas and in spoil dumps. See Figure 3 for a general layout view of the Project. Product coal will be transported by rail via the Surat Basin Rail and the Moura Rail System to Gladstone Port - Wiggins Island Coal Export Terminal, for export. The medium to long term plan is to link the Project with the Surat Basin Rail via the West Surat Link see section 2.6. During construction the number of on-site personnel is estimated to peak at approximately 500 (erection of CHPP structure) and during operations to start at around 300 people, rising over time to more than 350. Mine operations are planned to be continuous 24 hours a day and all year. MLA 50254 covers an area of 2,772 hectares (ha) (plan MP43991), MLA 50270 covers an area of 1,072 ha (plan MP43992) and the transportation corridor MLA 50271 linking the two covers an area of 128.7 ha (plan MP43993). Page 5 of 23
Figure 3: Elimatta Mine Project General Layout View Page 6 of 23
1.3 PROJECT PROPONENT Taroom Coal is the Project proponent. The Project s associated exploration tenements are held in the name of Taroom Coal and the MLAs are made in the name of Taroom Coal. Taroom Coal is a wholly owned subsidiary of NEC. At the time of the applications in 2009, NEC was an independent coal exploration and project development company listed on the Australian Securities Exchange (ASX). In 2010 NHC commenced an on-market takeover of NEC and in 2011 achieved full control. NEC and Taroom Coal thus became wholly owned subsidiary companies of NHC. NHC is an Australian owned Brisbane based coal exploration and mine development/operating company listed on the ASX (ASX code NHC). NHC has held interests in coal mining activities in Queensland and overseas for more than half a century. NHC s office is located at: 3/22 Magnolia Drive Brookwater Qld 4300 Phone +61 7 3418 0500 Fax +61 7 3418 0355 Website: www.newhopegroup.com.au 1.4 PROJECT TENEMENTS Taroom Coal holds the following exploration tenements associated with the Project: EPC 650 (Elimatta) EPC 1171 (Perrett s Road) MLA 50254 over EPC 650 was made on 2 June 2009. The Project mining excavation area will be located within MLA 50254. EPC 1171 is the subject of MLA 50270 and is located ~4.0km to the north-east of MLA 50254. That application is to provide areas for mine infrastructure, coal processing, waste rejects storage and, potentially, an on-site accommodation facility. Coal mining is not proposed within MLA 50270. The area of MLA 50270 is required to support coal mining within MLA 50254. In addition, EPC 1205 (Culgowie) is located approximately 35 km east of the Project and near to the corridor for the Surat Basin Rail. Subject to exploration success, options for development of this area will be considered once the Project is up and running. Page 7 of 23
1.5 UNDERLYING TENURES MINING TENEMENTS Glencore Coal Queensland Pty Ltd and its joint venturers Sumisho Coal Australia Pty Ltd and ICRA Wandoan Pty Ltd (together Wandoan JV) hold MDL 411 and MDL 449 and are applicants for MLA 50279. MLA 50271 (for transport purposes) overlaps part of each of MDL 411 and MDL 449 and is wholly overlapped by MLA 50279 see Figure 4. Figure 4: Mining Tenements around the Elimatta Mine Project PETOLEUM TENEMENTS BG International (Aus) Pty Ltd, Tokyo Gas QCLNG Pty Ltd and CNOOC Coal Seam Gas Company Pty Ltd (together the Gas Party) are holders of ATP 852, which includes the area of MLA 50254, MLA 50270 and MLA 50271. The Gas Party also holds of PL 299 and PL 397. PL 299 includes the area of MLA 50254 and MLA 50271. PL 397 includes the area of MLA 50270. Figure 5 shows the area of the overlapping production tenements. Taroom Coal and the Gas Party are parties to a Co-Development Agreement dated 26 March 2015. As required under the MR Act and the Petroleum and Gas (Production and Safety) Act 2005, Taroom Coal and QGC Pty Ltd, as manager for the Gas Party, have exchanged technical and other information and have held discussion about making a Coordination Arrangement to cover the activities each wishes to carry out in the overlap area of MLA 50254, 50270 and 50271 and PL 299 Page 8 of 23
and PL 397. As at the date of this document (September 2015) a Coordination Arrangement that is acceptable to the Minister is anticipated to be finalised shortly. Figure 5: Petroleum Tenements and the Elimatta Mine Project Page 9 of 23
2.0 PROJECT DESCRIPTION 2.1 TECHNICAL AND FINANCIAL RESOURCES OF THE APPLICANT See attachments for details of the technical and financial resources available to Taroom Coal due to its subsidiary status to NHC. 2.2 PROJECT RESOURCES The coal resource within the MLA 50254 area has been classified into measured, indicated and inferred categories in accordance with the 2004 JORC Code as shown in Table 1. Table 1: Coal Resources within MLA 50254 Horizon Measured Tonnage - Mt Indicated Tonnage - Mt Inferred Tonnage - Mt UG 4.4 20.4 13 Y 17.3 17.6 5 A 45.7 25.5 9 B 41.0 22.8 14 BC - 0.3 1 C - 13.9 7 Sub Total 108.4 Mt 100.5 Mt 50 Mt Total 259 Mt 2.3 MINE OPERATIONS ON MLA 50254 Prior to the development of the Project, mine topsoil will be progressively removed from the footprint area and stockpiled for later re-use in rehabilitation activities. Progressive rehabilitation will be undertaken through the life of the Project as operation areas become available. A layout of the Project mining area as it is envisaged at about the year 10 stage of operation is provided in Figure 6 which shows the scheduled mining progression across the tenure area. The deposit to be mined within MLA 50254 comprises two major seams of economic interest; the A and B Seams with smaller contributions from the UG, Y and C seam groups. Typically the overburden above the A Seam averages about 40 m in thickness and varies between 20 m and 60 m. Also present in the overburden are two smaller upper seams, the UG and the Y seams. The typical depth of overburden above the UG Seam is 15 m to 20 m, the interburden down to the Y Seam is 7 m to 8 m and the typical interburden to the A Seam is 7 m to 8 m. The configuration of seams favours shovel/excavator and truck mining methods. The C Seam has not Page 10 of 23
been included in mine plans at prefeasibility study level on the basis of its incremental strip ratio below the B seam being too high to allow for economic extraction. The suitability of a dragline for overburden/interburden removal is currently under consideration and remains an option for the Project. Further details of the geology of the Project area are contained in the EIS and the Amended Initial Development Plan documentation. Figure 6: Indicative Mine Concept Plan at Operating Year 10 Page 11 of 23
Spoil will initially be placed out of pit beside the first excavation or used for construction of infrastructure and thereafter backfilled to the mining void. The Project plan proposes three open pit operating areas which are separated by a fault zone within the deposit towards the northern end and the creek diversion works. The larger southern area will contain the diversion of Horse Creek which would otherwise drain though the middle of the major mining area. The Horse Creek diversion is described in detail in the EIS and environmental management conditions are included in the draft EA. The final rehabilitation plan for overburden dumps and waste storage areas has been detailed in the EIS and EMP and management conditions are shown in the draft EA. Where water quality within the void is suitable for stock, a safe access to the water shall be provided for stock, or the water will be pumped to a stock watering point. Consultation with landholders will be undertaken to determine the preferred use for the water. Where water in voids is not suitable for stock, the voids will be bunded or fenced to prevent stock access. 2.4 MINE INFRASTRUCTURE ON MLA 50270 The following mine infrastructure for the Project will be located within MLA 50270: Access and haul roads; Offices, workshops and ablutions facilities; CHPP; ROM stockpile pads and lay-down areas; Surface water management dams; Raw water storage dam; Water pipelines; Fuel, oil and chemical storages; Transmission lines and power supply infrastructure; Train loading facility. The proposed infrastructure layout is as shown in Figure 7. Page 12 of 23
Figure 7: General Layout Infrastructure Arrangement on MLA 50270 Page 13 of 23
Approvals for off-lease transmission lines and water pipelines to be provided by others will be undertaken separately. 2.5 RUN OF MINE COAL TRANSPORT ON MLA 50271 The MLA 50271 for transportation purposes will provide a transport corridor linking the mining operations planned for MLA 50254 with the processing and coal handling operations planned for MLA 50270. ROM coal will be hauled in large capacity trucks to the dump hopper at the CHPP area or to stockpile for later reclaiming and processing. Rejects material from the CHPP will be hauled back to the mine excavation areas. The transport corridor will also provide for light vehicle access between the mining and processing areas and for services such as power, water, and communications to link the two production working areas. The facilities will be contained within the boundary of the transport corridor. 2.6 PRODUCT TRANSPORT AND PORT Transport of the Project product coal will be by rail to Gladstone Port. A new rail link is expected to be constructed to connect the Moura Rail System south to the Wandoan area to service the transport needs of the mine developments in the North Surat. The Surat Basin Infrastructure Corridor has been mandated by the State and declared as a State Development Area. As at September 2015, plans to develop the rail infrastructure have not been finalised. Participants in the Surat Basin Rail Joint Venture (who were the original proponents of the rail project and who hold the rail design information) have advised Taroom Coal that a project to finalise corridor land acquisition, re-validate the design, establish the construction program and then to construct the rail to a ready for operations stage, would likely take in the order of 40 48 months. Taroom Coal intends to continue to work closely with potential developers of the rail so that it is able to contract for capacity should the opportunity arise and the economics be acceptable. The original proposal for the Project as a standalone mine development (owned by NEC) was for a rail connection from the mine area to join the SBR at a location approximately 10 km north of Wandoan. This connection was named the West Surat Link (WSL). In the period following making the MLAs in 2009 a large body of work has been carried out delineating a probable corridor for the WSL and environmental and initial sign studies completed. This work is comprehensively reported in the EIS documentation. Page 14 of 23
The probable corridor location, as shown in Figure 8, has been selected as a best balance between the competing interests: Minimising disruptions to landowners whose property would be crossed by the corridor; Avoiding potential sterilisation of coal resources; Providing for extensions for the corridor (and rail) further westward to service mine development opportunities west (and also south) of Elimatta; Constructability cutting and embankment balancing within a long narrow corridor; Operability horizontal and vertical alignments suitable for the train configuration that would be used to haul the product; Functionality the corridor would also likely carry pipelines for water, communications and power lines and possibly a public road, and A defined location (driven by train operations requirements) join the main rail in the Surat Basin Infrastructure corridor. The WSL will connect the Project with the SBR at a junction approximately 10km north of the Wandoan. Page 15 of 23
Figure 8: Possible West Surat Link Alignment 2.7 PROJECT SERVICES Approximately 800 ML/pa of water will be required during the construction phase of the Project and ~2,800 ML/pa for production activities. Details of water usage during operations can be found in Section 3.5.3 of the Project EIS. The potential for using untreated CSG extraction water as a supply at the front end of the Project is under investigation. CSG water is not expected to be available as a source in the quantities the Project and all other mine projects in the North Surat require over time, so longer term an alternative water supply will be required. This alternative is the Nathan Dam Project. The estimated installed electrical energy load for the Project is 12 MW which covers the operation of mining equipment, the CHPP and maintenance and domestic use. Approval of transmission lines and related power supply infrastructure outside of the MLA will be undertaken separately with Ergon Energy Corporation Limited which has advised that a connection application takes typically four years to complete. Diesel (or CSG) powered generators may be located on site for use as a power source during the construction stage and as a back-up supply to maintain essential services in the event that the grid supply is interrupted. 2.8 STAFFING AND ACCOMMODATION Page 16 of 23
The Project is located approximately 35 km west of Wandoan southern inland Queensland (45 50 km by road). During construction the number of on-site personnel is estimated to peak at approximately 500 (erection of CHPP structure) and during operations directly employ up to 300 full time staff initially increasing to more than 350 over time, with additional staff required for periodic large maintenance tasks and for special projects. The labour estimates for the construction period are shown in Figure 9. The labour estimates for the operations period are shown in Figure 10. Figure 9: Construction Period on-site Labour Estimates Figure 10: Operations On-Site Labour Estimates Page 17 of 23
At the time the MLAs were made in 2009, in the midst of significant activity by CSG project proponents and other coal mining companies, Taroom Coal formed the view that, being a comparatively smaller project, it would be outbid by the larger projects for local labour. Its labour strategy was therefore to utilise firstly what it could source locally but to link to the Fraser Coast area where NEC had another small mining project aspiration potentially using the Fraser Coast project as the front door to the Elimatta Project. This philosophy generated the requirement for an onsite accommodation village. However, with the extended time required to develop the Project together with the change in the labour dynamics in the Western Downs Region with the CSG industry passing from a construction phase into a operations phase (more stable labour wise), means that local labour resources are more likely to be available to the Project in higher numbers than was the case some years ago. An on-site (or near site) accommodation facility is still a major part of the labour management component of the Project given the significant travel times if labour is not housed near to the work site. But Miles, Chinchilla and to an extent Wandoan now have accommodation infrastructure that is underutilised. This will hopefully facilitate a much higher number of locally sourced labour. A final decision on a labour sourcing strategy will be made after the Project MLAs are granted as part of the development strategy for the Project to be approved by the Project owners. 2.9 ENVIRONMENTAL MANAGEMENT Environmental impacts and management considerations for the Project are fully documented in the Project EIS and the Project EMP. A draft EA for the Project was issued in August 2015 and will be subjected to the normal approvals processes for a mining project application. Page 18 of 23
In May 2008, the Commonwealth advised Taroom Coal that the proposed project was not a controlled action for the purposes of the Environment Protection and Biodiversity Conservation Act 1999 (Cth). An Application for an EA was made with MLA 50254 on 2 June 2009. Subsequently the Project draft Terms of Reference (TOR) for the EIS and the Project Initial Advice Statement were made available for public comment from November 2009. The EIS that was generated to address the TOR reporting requirements was made available for public comment in February 2013 and the updated EIS and Response to Comments documentation was provided to the Department of Environment and Heritage Protection (DEHP) in April 2014. The EIS assessment report was subsequently issued to Taroom Coal on 18 July 2014. The Project EMP was updated to reflect the requirements of the EIS assessment report and submitted to DEHP in June 2015. The EMP was approved in July 2015. 2.10 SITE REHABILITATION MLA 50270 is to provide land for permanent infrastructure for the Project. MLA 50271 is to provide a transport corridor linking the mining operations planned for MLA 50254 with the processing and coal handling operations planned for MLA 50270. As such plant and facilities will be constructed at start of the Project and remain in place to the end of the production time. Once their use in support of the mining operations is finished, buildings and the like will be removed and the areas re-contoured to blend in with the surrounding land and then revegetated. Surface preparation before revegetation will include surface contouring, ripping and topsoil spreading. Surface contouring will occur to minimise soil erosion. Topsoil will be stockpiled for use in rehabilitation as it contains organic material and local seed banks. Preserved topsoil will be spread to a thickness similar to the original topsoil). After appropriate surface preparation has occurred as outlined above, disturbed land will be revegetated as follows: Spread fertiliser and/or other ameliorates, such as gypsum at an appropriate rate, if required; Native species occurring naturally in the local area will be chosen for areas requiring the re-establishment of local native habitat; Where an agricultural land use is planned, the species planted will be those commonly used for pasture known to be successful on soils of similar texture; and Where practicable, revegetation will occur through direct seeding of selected species. Where direct seeding is not possible (e.g. small areas with limited access), seeds will be manually broadcast. 3.0 APPLICATION BOUNDARY AND AREA 3.1 MLA 50254 MLA 50254 is made using the EPC 650 boundary as the MLA boundary. The mining studies that Taroom Coal has conducted to date for the Project indicate that all but a small area in the central part (no near surface coal resource) and an area in the south western corner of MLA 50254 (deeper coal resource) contains potentially economically extractable coal resources by open cut mining methods using evaluation standards appropriate for today. For resource delineation purposes, all of the area of MLA 50254 has been properly explored and it is this exploration that Page 19 of 23
allows Taroom Coal to be confident that all of the tenure area except as noted above is potentially mineable. Thus, locking some of the area of MLA 50254 up for infrastructure would potentially sterilize what would otherwise be economic open pit coal. 3.2 MLA 50270 MLA 50270 is made over land contained within EPC 1171 using the boundary of the tenure in the main and Perretts Road (also known as the Yuleba Taroom Road) as the MLA boundary. MLA 50270 was made to provide working areas for mine infrastructure workshops, offices etc, the coal processing facility and waste storage that are necessary to support the mining operation within MLA 50254, leaving all of MLA 50254 available to Taroom Coal for coal mining. Taroom Coal has elected to use this area as its knowledge of the coal occurrence environment in and around this area together with the results from its exploration within the area lead it to the conclusion that the area does not contain economically viable near surface coal resource suitable for open pit mining. MLA 50270 has an area of 1,072 ha. Individual infrastructure to be placed on this tenure does not necessarily have large footprints, other than the waste storage facilities. The interconnection, for example by conveyors, between plant items means they have to be comparatively widely spaced. As part of the application area is also within the Q100 flood plain of Horse Creek, the remaining land for the infrastructure is constrained. The proposed layout represents a compromise between capital i.e. construction, and operation cost efficiency and land access restraints. A small part of the northern part of MLA 50270 area may also be utilised for an accommodation facility for the mine workforce. 3.3 MLA 50271 MLA 50271 is 128.7 ha and is made using the boundary of MLA 50270 to the north and MLA 50254 to the south as markers such that these tenures are joined in this application with a 500 metres wide corridor. The MLA width was set to allow for potential mining activities by the Wandoan JV Project whilst maintaining an access and haulage corridor for the Elimatta Project. 4.0 MINING LEASE TERM In 2009 the Project MLAs were made for a period of 40 years based on consideration of the Project as a whole and determined from: Project construction prior to start of production being estimated to take in the order of 18 months (now 22 24 months); The mine production period (based on coal resources within MLA 50254) at 5 Mtpa average product taking more than 30 years. This is dependent on the economics of operations later in the Project when operations could otherwise cease; Project de-commissioning and final rehabilitation taking 5 to 10 years depending on the rate of progress towards meeting expected final rehabilitation conditions for water management, soil and spoil stability and vegetative cover. Taroom Coal has been advised that DNRM policy is to recommend grant for 25 years as a maximum given that the MR Act provides a process for renewing a ML. Taroom Coal therefore proposes an initial term of 25 years as an alternative to the 40 year term initially requested. Page 20 of 23
5.0 LAND TENURE AND NATIVE TITLE 5.1 MLA 50254 The land within EPC 650 (the area the subject of MLA 50254) is freehold except for Lot 43, Plan AB222 (Reserve Land) which is Leasehold Land. Native Title has been extinguished other than for one area of unextinguished land the Reserve Land noted above. This area is located within the Iman No. 2 Native Title Claim (QUD6162/1998). Taroom Coal has obtained a Future Act Determination that the grant of ML 50254 may be done (QF2013/0001). Taroom Coal has an approved Cultural Heritage Management Plan for the area of the Project. The underlying land tenure for MLA 50254 is as follows: Lot 1 on AB241 Lot 1 on SP103977 Lot 2 on SP103977 Lot 33 on AB128 Lot 43 on AB222 (Reserve Land) Lot 38 on AB188 Lot 41 on AB241 Lot 42 on AB241 Lot 37 on AB180 Perretts Road (also sometimes known as Yuleba-Taroom Road) Horse Creek Taroom Coal intends to make an Infrastructure Agreement with the Western Downs Regional Council to provide for the road network that will be impacted by the Project. 5.2 MLA 50270 Four pastoral landholdings overlap the area covered by EPC 1171 and two are affected by the ML application. There are two local authority roads in the MLA area as shown on the survey plan: Perretts Road (also known as the Yuleba Taroom Road) and an unnamed local road. The ML boundary overlaps the Perretts Road corridor which will serve as an access route to the Project. The unnamed (and unconstructed) road will be upgraded to provide access across the lease to the adjoining western Lot and, potentially to the accommodation village. Taroom Coal intends to make an Infrastructure Agreement with the Western Downs Regional Council to provide for the road network that will be impacted by the Project. The pastoral land within MLA 50270 is freehold. Native title has been extinguished over the area of the application by the underlying land titles. The underlying land tenure for MLA 50270 is as follows: Lot 131 on SP 121742 Lot 60 on FT 900 Perretts Road (also known as Yuleba-Taroom Road) Unnamed local Road Page 21 of 23
5.3 MLA 50271 Two pastoral landholdings overlapping the area of the corridor. There is one local authority road crossing the area, Goldens Bimbadeem Road and the corridor is cornered on Perretts Road. The mine haul road will cross Goldens Bimbadeen Road and enter the area of MLA 50270 beside Perretts Road. The intersection of the mine haul road and Goldens - Bimbadeen Road will be a controlled intersection with traffic lights and/or boom gates with right of way referencing the more heavily used mine haul road. The pastoral land underlying MLA 50271 is freehold. Native title has been extinguished over the area of MLA 50271 by the underlying land tenure. Taroom Coal intends to make an Infrastructure Agreement with the Western Downs Regional Council to provide for the road network that will be impacted by the Project. The underlying land tenure for MLA 50270 is as follows: Lot 131 on SP 121742 Lot 41 on AB241 Perretts road (also known as Yuleba-Taroom Road) Goldens Bimbadeen Road 6.0 PUBLIC INTEREST STATEMENT The Project scope and objectives are to: Extract an open cut coal Resource of ~259 Mt at shallower than 100m below surface. At a production rate of up to 8.2 Mtpa ROM coal average 7.5 Mtpa for + 30 years (current assessment actual production duration will be dependent on coal prices for the product prevailing at the time of production). Establish and operate a conventional open cut mining operation using trucks and excavators. Construct and operate mine related infrastructure including workshop, offices and CHPP. Transport product to Gladstone Port for export. The Project is considered by Taroom Coal to be viable given the following: Total Resource measured, Indicated and Inferred of 259 Mt (reported to JORC standard). Mining resource is suitable for low cost open pit extraction. Thermal Coal product is suitable for use in the power generating industry. As there is no infrastructure suitable for mine processing activities, heavy equipment maintenance, coal stockpiling and waste storage located within the area of or near to the MLA areas. Coal is one of Queensland s highest value exports and the coal industry provides significant value to the State by way of direct and indirect employment, purchase of goods and services and payment of taxes and royalties. The Project provides an opportunity to add to the contribution the industry makes to the State with its development in a region not currently directly benefiting from the continued growth of the coal and other resource sectors. The Project will also provide a benefit to the country on a national scale. This is achieved through increased foreign exchange revenue from the export of coal and general economic stimulus through increased employment and the purchase of goods and services. Page 22 of 23
Taroom Coal has identified a resource of +250 Mt within the Project area, of which up to 170 Mt can be economically extracted using today s evaluation standards by efficient open cut mining methods to generate 5.0 Mtpa product coal suitable for the international market for thermal coals. The Project is anticipated to have a production life in excess of 30 years. The value of infrastructure construction is estimated to be $400 - $500 million (2013 dollars). Although many of the mining inputs will be imported into the regional economy, the workforce is expected to be recruited locally where available and/or provided as FIFO or DIDO/BIBO. As the Project is now following on from the CSG industry construction boom, rather than competing with CSG for resources and labour a local workforce is expected to be available. It is expected that about $250 million of construction expenditures will be sourced from domestic suppliers and $150-250 million will be spent on imports. The wage costs during construction are estimated to be $40-45 million, most of which will be Queensland based. Annual employee payroll in the operating phase is expected to be more than $36 million per year. A range of operational expenditures will be sourced from Queensland based firms including rail services, port services, power and water supplies and plant maintenance. Full year expenditures on rail and port services are expected to exceed $125 million per annum. The Project will pay significant on-going revenue to the State Government through royalty and payroll tax obligations. Without the mine these payments will not be received. The annual royalty payment to the State resulting from sales of the product from mining operations, based on 5.0 Mtpa sales and a price of A$100 is in the order of $35 million. The Project will directly generate approximately up to 500 full time equivalent jobs during construction and 300 for early production to generate spending potential in the regional area where the workforce is located of approximately $18 million each year. The Project will have a positive impact on the economy of the region and the State through ongoing expenditures for materials and services, payment of rates, purchase of infrastructure, plant and consumables, use of service industries and payment of taxes. Page 23 of 23