BROKEN SHIP LOADER A CRUEL BLOW FOR NEW HOPE
Written on the 15 November 2016 by James Perkins
THE ship loader at Brisbane's coal port will be out of action for several weeks after it was damaged in Sunday night's storm, says owner New Hope Coal (ASX: NHC).
It's bad news for New Hope, which has battled through a period of low thermal coal prices to find that its key export terminal is damaged just as prices have shot up to multi-year highs.
In its quarter one FY17 statement, which was also released today, New Hope says the "significant and sustained" rally in thermal coal prices during the quarter will have a positive impact on earnings in the 2017 financial year.
However, until the loader is repaired, the Queensland Bulk Handling terminal will not be capable of loading coal onto ships.
"The financial implications of this event are still being assessed, however delays to shipments due to this incident may result in lower sales for the current financial reporting period," says New Hope in a statement.
The company's share price has dropped 1.43 per cent to $1.725 today in the wake of both announcements.
In the three months to 31 October, New Hope increased total raw coal production by 40 per cent to 3.9 million tonnes.
Total saleable coal production was up 57 per cent at 2.1 million tonnes, while total coal sold was up 38 per cent at 1.9 million tonnes.
The first quarter production was lifted by the inclusion of the Bengalla coal mine, located in the Hunter Valley, of which New Hope acquired a 40 per cent stake from Rio Tinto or US$606 million in March 2016.
In Queensland, where the company owns mines around the Darling Downs, raw and saleable coal production was steady on the prior corresponding period.
"The quantity of coal sold during the quarter was well below the prior quarter due to the timing of sales and the delay in shipping activity caused by an active typhoon season in Asia," says the statement.
The company's plans for the stage 3 expansion of its New Acland mine, near Oakey, are progressing - Land Court hearings concluded on 7 October, with recommendations regarding the grant of the mining lease expected to be with the responsible minister by the end of December, but new groundwater legislation could cause a 12-month delay on the project.