Freight Rail

Despite weak coal market, Aurizon secures new coal export deal


Rail operator Aurizon has secured a contract with miner Caledon to haul up to 4 million tonnes of coal per annum to the new Wiggins Island Coal Export Terminal (WICET) at the Port of Gladstone in Queensland.

WICET has been in development for several years, by its ownership group comprised of eight miners, which operate or plan to operate mines in the region. WICET opened this week, several months later than the original planned date, and with one of its eight owners (Bandanna Energy) having gone into administration.

The price for thermal coal currently sits just above a six-year low. But that has not deterred Caledon.

Aurizon announced a new, long term, performance-based contract with the for haulage of up to 4 million tonnes per annum, thanks to a ramp-up at its Cook mine in Central Queensland.

Aurizon said the new-form contract will deliver a modern and flexible agreement for both Caledon and Aurizon, and cements a long-term relationship between the two companies.

The 11-year contract is effective from May 2015, and runs to June 2026.

The contract was contestable and supersedes Aurizon’s existing contract for 500,000 tonnes per annum, the operator said.

“Aurizon is delighted to renew and extend its relationship with Caledon through to 2026,” Mauro Neves, Aurizon’s executive vice president for marketing, said on Tuesday.

“With these significant expansion tonnages, Caledon is showing great confidence in the strong future of the Queensland coal sector.  Aurizon is pleased to secure this contract and partner with Caledon in this growth.”

The coal will be transported using existing Aurizon electric trains on the Blackwater system to WICET.

Caledon’s Cook Colliery is located approximately 30km south of the Blackwater township in Queensland.

It is an underground operation that produces both coking and thermal coal, at an approximately 80/20 split, respectively.

WICET has been built to provide 27 million tonnes of annual capacity, but can expand to a total of roughly 120 million tonnes per annum.

The terminal’s rail and train unloader can cater for trains of up to 2.5km in length, and can unload at a discharge rate of 9,200 cubic metres per hour (between 6,900 and 8,250 tonnes per hour, depending on product). The rail facility’s feeder belts are 3.2m wide, and feed a 5.6km overland conveyor, which is 1.8m wide and moves at 6.9m/s.