DFS Section 2 Executive Summary

MAY 2011 PAGE 32 OF 594
EAGLE DOWNS COAL PROJECT  FRONT-END LOADING 3  DEFINITIVE FEASIBILITY STUDY
CHAPTER 2 EXECUTIVE SUMMARY
2.1 Project Overview
 Eagle Downs involves proposed construction, development and operation of an
underground longwall hard coking coal mine in Queensland’s resource-rich Bowen Basin
 Eagle Downs Coal Management (EDCM) represents owners Vale and Aquila
 Vale FEL3 and Aquila DFS deliverables have been mapped and addressed.
The Eagle Downs project involves proposed construction, development and operation of an
underground longwall hard coking coal mine, in Queensland’s Bowen Basin. The proposed mine is
located south of the town of Moranbah, central Queensland, and is down-dip of the neighbouring BHP
Billiton Mitsubishi Alliance (BMA) Peak Downs open-cut mine. The project is managed by Eagle
Downs Coal Management Pty Ltd (EDCM) on behalf of the Bowen Central Coal Joint Venture
(BCCJV). The mine is planned to produce export metalliferous coal from three target seams in the
Moranbah coal measures. Planned run-of-mine (ROM) coal production from the mine is in excess of
five million tonnes per annum (5mtpa), of which the majority will be classified as hard coking coal.
The project has access to rail infrastructure that traverses the southeast corner of the site. A rail spur
and balloon loop will be constructed within the Eagle Downs mine lease, connecting to the Peak
Downs branch of the Goonyella Coal Network. Coal will then be transported to regional ports on the
Queensland coast, as illustrated in Figure 2-1. Power is available from the Powerlink-owned 132-
kilovolt (kV) Moranbah-to-Dysart transmission line that traverses the site. It is planned for water to be
sourced from the Southern Spur pipeline duplication, which provides water from the Moranbah
terminal storage supply. Water will also be sourced from SunWater’s Connors River dam.

MAY 2011 PAGE 33 OF 594
]
Figure 2-1: Eagle Downs Location (Queensland)

MAY 2011 PAGE 34 OF 594
Figure 2-2: Eagle Downs Location (Local – Adjacent Mines and Infrastructure)
2.1.1 Project Ownership
The Eagle Downs project is owned by BCCJV, the participants in which are Bowen Central Coal Pty
Ltd (50%) – subsidiary of Brazilian mining company Vale – and Aquila Coal Pty Ltd (50%) – subsidiary
of Australian-listed mining company Aquila Resources Ltd. EDCM manages the BCCJV on behalf of
the participants.

MAY 2011 PAGE 35 OF 594
2.1.2 FEL/DFS Process
A conceptual Front-End Loading (FEL) 1/Definitive Feasibility Study (DFS) was completed in June
2008 and evaluated by the JV participants under their respective tollgate processes in July 2008.
Upon JV approval, the next study phase (FEL2/FS) commenced and was completed in June 2009.
After requesting additional information (FEL2/FS Addendum, February 2010), the JV approved the
project progressing to FEL3/DFS.
All studies were prepared to accommodate BCCJV requirements. Each JV participant had different
requirements in terms of review, terminology and tollgating processes. Subsequently, EDCM did not
adopt a single standard for the work.
FEL3/DFS identified that A$1.3 billion of project capital expenditure will be required to develop the
mine, up until the first 100,000 tonnes (t) of longwall coal.
2.1.2.1 Vale FEL Methodology
To support Vale’s gate decision-making, FEL development is evaluated through assessments before
proceeding through each gate:
Figure 2-3: Project Lifecycle with Gates
2.1.2.2 Aquila DFS Process
The following standard is part of Aquila’s project delivery system and defines the deliverables required
to be presented and demonstrated during the DFS stage of Aquila’s project delivery process:
Figure 2-4: Aquila Project Delivery Process
Development phase
Gate 1
Construction
Gate 3Gate 2
Execution
Planning
Trade-off
analysis
Business
Analysis
Operation
Cancel
Recycle
Proceed
Initiate Start up

MAY 2011 PAGE 36 OF 594
2.1.2.3 Lead Consultants
A detailed list of FEL3/DFS deliverables from both JV partners was provided to a select group of
engineering consultants for each area of the project to ensure that all requirements were covered in
FEL3/DFS. These lead consultants are detailed in Table 2-1:
Table 2-1: Lead Consultants
Area Consultant
Surface Infrastructure AECOM
CHPP Sedgman
Underground Mining Mining Consultancy Services (MCS)
Underground Engineering MineCraft Consulting
2.1.3 Business Objectives
EDCM aims to design, construct and operate a safe and productive longwall operation at the Eagle
Downs mine site to maximise JV participants’ return on investment. In line with these business
objectives, numerous financial and engineering studies were completed and are planned to ensure
that the following business objectives are achieved:
 Safe mining culture with the aim of zero harm
 Low-cost, high productivity longwall mine utilising all available enabling technologies
 Delivery of a coal product on time and to customer specifications
 Sustainable mining operation that manages all onsite water, dust, noise and landform interactions
with the mine to standards that exceed government and community expectations.
2.1.4 Project Objectives
Eagle Downs project objectives are to:
 Develop a fit-for-purpose underground coal mine with an initial capacity of at least 5mtpa of ROM
hard coking coal
 Design and construct a fit-for-purpose underground longwall coal mine that can be operated in a
safe and profitable manner
 Maximise the economic and effective recovery of the identified resource
 Comply with all relevant legislation during all phases of the project (design, construction and
operation)
 Construct and operate the mine with sympathetic regard to all affected and interested parties, e.g.
landowners, Native Title holders, community interest groups, government agencies, etc.
 Maintain the reputation of JV participants within the mine workforce and community.

MAY 2011 PAGE 37 OF 594
2.2 Market Analysis and Business Strategy
 Current tight supply conditions are expected to be alleviated with commissioning of new
supply streams and alleviation of port and rail constraints
 The Eagle Downs brand should be well received in global metallurgical coal markets.
Supply conditions for global seaborne trade of coking coal are currently tight and growth in demand is
expected to exceed growth in supply. An important long-term driver of hard coking coal demand
growth is the increasing use of larger blast furnaces. These larger blast furnaces require higher-
strength coke to support larger and heavier volumes of blast furnace burden. Growth in the supply of
coking coal is expected to be constrained by such issues as rail and port infrastructure limitations,
government intervention and the diminishing rate of high quality coking coal reserves.
Severe flooding in Queensland reduced availability of high quality coking coal in the December and
March quarters of 2010/11 and has contributed to record sales prices. In the medium term, coal prices
are expected to remain strong, above US$230/t FOB until 2013. Subsequently, price growth is likely to
slow as tight demand and supply market conditions are eased with the commissioning of new supply
streams and alleviation of port and rail constraints.
In the long term, AME assumes that critical rail and port infrastructure expansions will be implemented
and provide sufficient capacity to alleviate potential bottlenecks for landborne and seaborne trade,
particularly in Australia. The addition of these new capacities may mean contract prices will begin to
stabilise.
The Australian dollar forecast of coal pricing for the life of the Eagle Downs Mine is particularly difficult
to determine in the current global economy. The two components of the pricing – selling price in US$
and the US$-A$ exchange rate, are both currently well outside of historical trends, with financial and
market analysts reluctant to forecast beyond five years
To apply consistency to price and exchange rate, EDCM sought long-term price and exchange rate
projections from Merrill Lynch, the only organisation from which both could be sourced:
 Standard hard coking coal US$167.33/t FOB
 Exchange rate A$/US$0.77.
The Dysart (DY) seam will produce a higher quality standard hard coking coal than the Harrow Creek
Upper (HCU) and Harrow Creek Lower (HCL) seams. There is also some deterioration of quality in the
deeper areas of each seam. This variability is not seen to have any material effect on the marketability
of the Eagle Downs brand but price penalties/bonuses were assumed to reflect the financial impact of
the quality variation.

MAY 2011 PAGE 38 OF 594
2.3 Project Evaluation and Expenditure
 Schedule A IRR = 15.22%, NPV $675 million (10%) and $349 million (12%)
 Schedule B IRR = 15.16%, MPV $602 million (10%) and $302M (12%)
 Project capital cost = $1.25 – $1.26 billion
 Operating costs = $27.48/ROMt, $74.77/Prd t FOR and $112.70/Prd t FOB.
2.3.1 Economic Evaluation
A cashflow analysis was developed for execution of Schedule A and Schedule B. Both execution
schedules will provide attractive internal rates of return (IRR) and net present value (NPV) for the
project, with Schedule A being slightly more attractive.
The IRR, NPV and payback period (at 10% and 12% discount rates) for life-of-mine (LOM) production
are provided in Table 2-2:
Table 2-2: Eagle Downs Economic Analysis Summary
Execution Schedule Discount Rate IRR NPV Payback
Schedule A
10% 15.22% $675.0M 2022
12% 15.22% $348.6M 2024
Schedule B
10% 15.16% $601.9M 2024
12% 15.16% $302.0M 2025
2.3.2 Capital Cost Estimates
2.3.2.1 Project Capital Cost Summary – Schedule A
Eagle Downs’ project commitment capital cost estimate – Schedule A – is summarised in Table 2-3,
as per the work breakdown structure (WBS).
Table 2-3: Project Commitment Capital Summary – Schedule A
WBS Level Project Commitment Capital Estimate FEL3/DFS ($,000,000)
1 2 3 WBS – Area Base Growth Subtotal Owner
Costs
Risk Total
ED 0 0000 Eagle Downs $1,144 $53 $1,199 $20 $85 $1,327
ED 3 0000 Surface $199 $23 $223 $2 $20 $246
ED 4 0000 Underground $603 $9 $613 $16 $42 $695
ED 5 0000 CHPP $264 $19 $284 - $16 $300
ED 7 0000 Project services $77 $2 $79 $2 $6 $87

MAY 2011 PAGE 39 OF 594
Project commitment capital is defined as the capital commitments required during the project phase of
Eagle Downs mine development. This is different to the project capital defined by JV participants for
FEL3/DFS deliverables. Project capital is the capital spent until the first 100,000t of longwall coal are
produced. The main difference is related to the longwall purchase. The second set of longwall
equipment will be ordered as part of the longwall package but the majority of cashflow forecast for this
equipment will impact after the longwall commences production, as this equipment will be required for
the second longwall block. Project capital for Schedule A is shown in Table 2-4:
Table 2-4: Project Capital Summary – Schedule A
WBS Level Project Commitment Capital Estimate FEL3/DFS ($000,000)
1 2 3 WBS – Area Project Commitment Project Capital
ED 0 0000 Eagle Downs $1,327 $1,260
ED 3 0000 Surface $246 $246
ED 4 0000 Underground $695 $627
ED 5 0000 CHPP $300 $300
ED 7 0000 Project services $87 $87
2.3.2.2 Project Capital Cost Summary – Schedule B
Eagle Downs’ project commitment capital cost estimate – Schedule B – is summarised in Table 2-5,
as per the WBS:
Table 2-5: Project Commitment Capital Summary – Schedule B
1 2 3 WBS – Area Base Growth Subtotal Owner
Costs
Risk Total
ED 0 0000 Eagle Downs $1,140 $53 $1,193 $20 $85 $1,321
ED 3 0000 Surface $195 $22 $218 $2 $20 $240
ED 4 0000 Underground $603 $9 $613 $16 $42 $695
ED 5 0000 CHPP $264 $19 $284 - $16 $300
ED 7 0000 Project services $77 $2 $79 $2 $6 $87
The only variance in project commitment and project capital for Schedule B was the reduced capital
costs associated with temporary power generation in surface infrastructure capital, due to Powerlink
infrastructure still being available from March 2013. Schedule B project capital is shown in Table 2-6:

MAY 2011 PAGE 40 OF 594
Table 2-6: Project Capital Summary – Schedule B
1 2 3 WBS – Area Project Commitment Project Capital
ED 0 0000 Eagle Downs $1,321 $1,254
ED 3 0000 Surface $240 $240
ED 4 0000 Underground $695 $627
ED 5 0000 CHPP $300 $300
ED 7 0000 Project services $87 $87
2.3.3 Operating Cost Estimates
Operating costs for the project were developed from first principles and are summarised in Table 2-7
and Table 2-8, which show average costs over the life of the project:
Table 2-7: Schedule A Total Operating Costs
Operating Costs ROM$/ROMt ROM$/Prd t FOR$/Prd t FOB$/Prd t
Mine operating costs $27.48 $47.05 $47.05 $47.05
Surface operating costs $0.85 $0.85
CHPP operating Costs $11.66 $11.66
Support services $15.21 $15.21
Logistics and royalties $37.93
Total operating cost $27.48 $47.05 $74.77 $112.70
Table 2-8: Schedule B Total Operating Costs
Operating Costs ROM$/ROMt ROM$/Prd t FOR$/Prd t FOB$/Prd t
Mine operating costs $27.34 $46.80 $46.80 $46.80
Surface operating costs $0.83 $0.83
CHPP operating costs $11.70 $11.70
Support services $15.17 $15.17
Logistics and royalties $37.27
Total operating cost $27.34 $46.80 $74.50 $111.78

MAY 2011 PAGE 41 OF 594
2.4 Geology and Resource
 Eagle Downs’ JORC resource estimate is 959 million tonnes
 Target seams are HCU, HCL and DY in the Moranbah coal measures
 Majority of reserves are classified as hard coking coal of similar quality to that at BMA’s
Norwich Park mine.
2.4.1 Target Coal Seams
The HCU, HCL and DY seams of the Moranbah coal measures form the principal economic coal
resources in the Eagle Downs resource area. Typical seam stratigraphy is shown in Figure 2-5:

MAY 20
2.4.2
Reso
of Inv
with t
Miner
early
011
Resour
ources were e
ventory Coal
the Joint Ore
ral Resource
stages of exp
EA
rce Estimati
estimated in
, Coal Resou
e Reserves C
es and Ore R
ploration.
AGLE DOWNS CO
on
accordance
urces and Co
Committee’s
Reserves (De
OAL PROJECT 
F
with the Aus
oal Reserves
Australasian
ecember 2004
 FRONT-END L
Figure 2-5: Ty
stralian Guid
s (March 200
n Code for Re
4). The Q sea
LOADING 3  D
ypical Seam S
elines for Es
03), and were
eporting of E
am was cons
EFINITIVE FEAS
Stratigraphy at
stimating and
e reported in
Exploration R
sidered for mi
PAGE 42 OF 594
IBILITY STUDY
Eagle Downs
d Reporting
n compliance
Results,
ning in the
4
s
e

MAY 2011 PAGE 43 OF 594
Table 2-9: Summary of In Situ Resources by Seam (depths from 150m to >600m)
Seam Measured
Tonnes x 10
6
Indicated
Tonnes x 10
6
Total Measured
and Indicated
Tonnes x 10
6
Inferred
Tonnes x 10
6
Total Measured
Indicated and
Inferred
Tonnes x 10
6
Q 73 20 93 15 108
HCU 123 36 158 31 189
HCL 281 70 351 49 400
HCL ‘pci’ 3 3 8 11
DY 164 13 177 16 193
DY ‘pci’ 7 30 37 22 58
Total 648 171 819 140 959
2.4.3 Coal Quality
Coal quality was determined from an updated geology database and included into the XPAC model.
The model can produce the average coal quality results by period or area and has produced tables for
average coal quality by longwall block. Coal price discounts were applied to coal quality by period in
the economic models.
2.4.4 Hydrogeology
Groundwater inflow modelling was completed as part of FEL3/DFS. Estimates of inflow to the mine
workings were generally below 20l/s, with a few peaks of up to 28l/s occurring for short durations, due
to the specific areas being mined and their proximity to previously mined areas and goaf inflow.
2.4.5 Geotechnical
During FEL3/DFS, there was emphasis on assessing various mine planning options relating to specific
geotechnical parameters, including stress, joint and cleat orientation, and roof rib and floor conditions.
IMC Solutions was asked to assess various mine layouts with regard to geotechnical risk and impacts.
Additional geotechnical analysis and assessments undertaken during the study included:
 Coordination of field work and geotechnical logging and sampling
 Detailed FLAC 3D evaluation of multi-seam stresses and impacts (for various mine layouts and
orientations)
 Numerical modelling to determine/validate roof and rib conditions and ground support
requirements for development workings
 Assessment of longwall face widths with respect to geotechnical impacts
 Assessment of longwall shield specification for preliminary quotes and costing
 Assessment of longwall top coal caving (LTCC) application
 Assessment of likely subsidence impact.

MAY 2011 PAGE 44 OF 594
2.5 Surface Infrastructure
 All major work packages were tendered during the FEL3/DFS study
 Cost-effective surface infrastructure solution will enhance the Eagle Downs operation
Design of Eagle Downs’ surface and enabling infrastructure was developed as part of AECOM’s
FEL3/DFS scope of works. During FEL2/FS, five coal handling plant and site layout options were
considered. Based on agreed assessment criteria, the final surface layout was developed and
optimised during FEL3/DFS. The final site configuration includes:
 Mine-access road
 Mine industrial area (MIA)
 Site village accommodation
 Mine-access drift box-cut and underground infrastructure areas
 Coal handling and preparation plant comprising:
Surface and enabling infrastructure was divided into five major areas:
 Site-wide bulk earthworks
 High-voltage (HV) electrical infrastructure
 MIA and site services
 Rail loop
 Site accommodation village.
Figure 2-6: Eagle Downs Surface Layout

MAY 2011 PAGE 45 OF 594
2.6 Underground Mining
 Mine design was optimised during FEL3/DFS, taking into account 3D seismic results
 Ventilation design was optimised to suit new mine plans and schedules
 Gas management report recommended SIS pilot drilling program be completed
 All major mining equipment was tendered
 LOM production rates benchmarked against leading Australian longwall mines
 Eagle Downs has estimated JORC reserves of 254 million tonnes
The Eagle Downs FEL3/DFS mine design process considered all available data and in particular,
results of structural interpretation and floor grades in relation to FEL2/FS mine layout. The approach
was to evaluate the final mine design from first principles and to develop a ranking process to
determine optimal mine configuration and mine layout requirements.
2.6.1 Mine Access
The study considered various mine-access options; however, the FEL2/FS conclusion to adopt a drift
to access target seams at the shallowest area of the resource was validated.
2.6.1.1 Drift Design Process
The proposed configuration comprises twin parallel drifts, from surface to the HCU seam at a grade of
1:7, with interconnecting cut-throughs at appropriate intervals. The benefit of this configuration will be
that both drifts can be developed together, while a ventilation circuit can be established through the
cut-throughs. The 1:7 grade was selected as the maximum to safely operate rubber-tyred diesel
vehicles in a drift of more than 2km in length.
Surface excavation through weathered and unconsolidated material will be by box-cut to a depth of
some 20m, after which it will be stabilised, covered and back filled.
2.6.2 Mining Layout
An extensive mine design evaluation process was completed, involving several presentations and
workshops with EDCM, consultants and JV participants. The layout was developed to best suit the
resource and to improve resource recovery and practicality.

MAY 20011
EAAGLE DOWNS COOAL PROJECT  FRONT-END LLOADING 3  D
Figure 2-
Figure 2-
EFINITIVE FEAS
-7: HCU Seam
-8: HCL Seam
PAGE 46 OF 594
IBILITY STUDY
m Mine Layout
m Mine Layout
4
t
t

MAY 2011 PAGE 47 OF 594
Figure 2-9: DY Seam Mine Layout
2.6.3 Ventilation
EDCM engaged Roy Moreby (Morvent Mining), a recognised industry leader in ventilation design and
gas management, to deliver FEL3/DFS ventilation requirements for the Eagle Downs project. Roy has
been involved with the project since its inception, completing the initial concept study in late 2008 and
following up with the more detailed FEL2/FS study in April 2009.
The recent study provided confidence that the proposed mine design and production schedule can be
practically and technically achieved within industry-accepted construction and safety standards. It was
carried out in collaboration and consultation with other study providers, particularly Geogas –
responsible for the gas emission and gas management part of the study – and Mine Consulting
Services (MCS) – principal consultant responsible for underground mine design and schedule. The
study and content was also peer reviewed by an independent underground coal mining consultant.
2.6.4 Gas Management
Gas and gas management, including methane drainage, will present significant hazards for the Eagle
Downs project, both from safety and financial perspectives.
Extensive gas emission and gas management studies were completed by Geogas and Morvent
Mining. The two worked collaboratively, with input from MCS, which prepared the final mine design
and production schedule. The combined reports have given EDCM confidence that proposed gas
mitigation and ventilation strategies can be established to provide a safe underground working
environment, and that potential delays caused by excessive gas concentration in working faces will be
minimised.

MAY 2011 PAGE 48 OF 594
2.6.4.1 Key Risks and Recommendations
Key gas-related project risks:
 Pre-drainage will be required in all areas where gas content is above 5m3
/t for control of rib
emission and above 7m3
/t for mitigation of outbursts risks
 Permeability data at depths greater than 400m in the mine-plan area are sparse. The
permeability/depth relationship derived from measured data suggests that the HCU and HCL
seams at depths of 450m-plus will likely be difficult to drain
 In the initial HCU and HCL development (TG100, MG100 and TG306), it will be important to
provide for SIS pre-drainage well ahead of time to avoid gas constrained development, particularly
in areas where gas contents exceed the recommended outburst threshold
 Given the need to obtain at least two, preferably three to five years’ experience with SIS pre-
drainage performance to optimise hole patterns, there will be risk to 100s and 300s area
development (and longwall production) if the initial SIS program does not commence in an
appropriate timeframe
 Unless the Q seam is pre-drained prior to longwall extraction, very high goaf-drainage-capture
efficiencies (>70%) will be required in some areas. Although technically feasible, without roof-
seam pre-drainage, it is likely that longwall production will otherwise be gas constrained in HCU
inbye 100 and all 300 areas
 As a result of development and longwall gas emission predictions, as well as EDCM’s proposed
production rates, a business risk was identified in attempting to extract 100s and 300s blocks on a
two-heading gateroad basis. Subsequently, a high-ventilation capacity – supported by a proactive
SIS with additional UIS – pre-drainage gas management approach is recommended.
2.6.5 Mining Equipment
Assessment of Eagle Downs’ equipment requirements was undertaken in collaboration with MineCraft
Consulting, MCS and EDCM. MCS contributed the functional specifications and requirements from
which MineCraft obtained quotations from suppliers on behalf of EDCM. The mechanical and electrical
details of the proposed equipment were determined between MineCraft and EDCM to satisfy the
approval requirements of the project. Major underground work packages included in the scope of
supply are detailed in Table 2-10:
Table 2-10: Major Underground Work Packages
WBS Code Work Package Description Comments
ED.4.1000 Development equipment  Continuous miners
 Shuttle cars
 Feeder/breakers
 Panel auxiliary ventilation and electrical systems
ED.4.2000 Mobile diesel equipment  Flameproof personnel transporters
 Underground loaders and attachments
 Non-flameproof personnel and materials transport
ED.4.3000 Underground services – electrical  11Kv surface and underground switchboards
 Underground section circuit breakers
 HV and LV substations
 11kV boreholes
 Communication systems and monitoring equipment

MAY 2011 PAGE 49 OF 594
WBS Code Work Package Description Comments
ED.4.4000 Underground services –
mechanical
 Compressed air system
 Mine dewatering system
 Diesel transfer, fluid reticulation, stone dust, ballast
and concrete
ED.4.5000 Underground miscellaneous  Includes main ventilation equipment, heat
management, gas drainage plant and nitrogen
inertisation plant
ED.4.6000 Underground coal clearance
system
 Includes drift conveyor, trunk conveyors, gateroad
conveyors and surface stockpile conveyor
ED.4.8000 Longwall Complete 300m-wide longwall system, including some
second sets of equipment and emulsion system, such
as:
 Powered roof support
 Shearer
 Pump station
 Monorail
 Electrics
 AFC and BSL
2.6.6 Mine Planning
2.6.6.1 Mine Production Rates
Extensive analysis was undertaken to determine probable productivities for Eagle Downs in both
development and longwall mining operations, using projected characteristics for each of the target
seams (HCU, HCL and DY), as well as the operational methodologies of selected mining methods.

MAY 2011 PAGE 50 OF 594
Schedule Progress Plot (HCU Seam)
A progress plot for colour-coding areas mined on an annual basis is included in Figure 2-10:
Figure 2-10: Plan Progress Plot by Year – HCU Seam

MAY 2011 PAGE 51 OF 594
Schedule Progress Plot (HCL Seam)
A progress plot for annually colour-coding areas mined is included in Figure 2-11:
Figure 2-11: Plan Progress Plot by Year – HCL Seam

MAY 2011 PAGE 52 OF 594
Schedule Progress Plot (DY Seam)
A progress plot for annually colour-coding areas mined is included in Figure 2-12:
Figure 2-12: Plan Progress Plot by Year – DY Seam

MAY 2011 PAGE 53 OF 594
2.6.6.2 Life of Mine Production Scenarios
The LOM base-case schedule proposed for all three Eagle Downs target seams (HCU, HCL and DY)
is summarised in Figure 2-13. This represents an expected LOM of 48 years.
Figure 2-13: LOM ROM Production for All Seams
2.6.7 Mine Operation
2.6.7.1 Owner/Contractor Task Breakdowns
Assumptions around allocation of some of the major tasks in the development sections are described
in Table 2-11 and Table 2-12, respectively:
Table 2-11: Summary of Development Responsibility Assumptions
Task Eagle Downs Crews Contractor Crews
Gateroad driveage  Possible use of contractors
Mains driveage  Possible use of contractors
Panel advances  
Ventilation control devices  
Secondary support
Some secondary support installed
by support crews

Drive-head installations  
Fault driveage Minor faults developed by mine

Major faults developed by
contractors, as required
Gas drainage  
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
YR1
YR3
YR5
YR7
YR9
YR11
YR13
YR15
YR17
YR19
YR21
YR23
YR25
YR27
YR29
YR31
YR33
YR35
YR37
YR39
YR41
YR43
YR45
YR47
YR49
YR51
YR53
TotalROMTonnes
Total ROM Production
CalendarYears
HCU Longwall ROM Tonnage HCU Development ROM Tonnage
HCL Longwall ROM Tonnage HCL Development ROM Tonnage
DY Longwall ROM Tonnage DY Development ROM Tonnage

MAY 2011 PAGE 54 OF 594
Table 2-12: Summary of Longwall Responsibility Assumptions
Task Eagle Downs Crews Contractor Crews
Longwall mining  
Longwall relocations  
Ventilation control devices  
Secondary support
Face bolt-up will be carried out by
the mine

Drive-head installations  
Gas drainage  
2.6.8 JORC Reserves Statement
MCS completed a revised Eagle Downs JORC compliant reserves statement in March 2011:
Table 2-13: JORC Reserves by Seam
Category ROM Tonnes (t) Percentage (%)
HCU Seam
Probable 13,531,272 18%
Proved 60,055,413 82%
JORC reserves 73,586,685 100%
HCL Seam
Probable 21,908,248 19%
Proved 91,117,439 81%
DY Seam
Probable 12,011,487 18%
Proved 55,447,748 82%
Total
Probable 47,451,007
Proved 206,620,600
JORC reserves 254,071,607
2.6.9 Project Expansion Case
Although not part of the FEL3/DFS scope of works, a concept expansion case has commenced,
involving development of an XPAC schedule and underground cost model to include the following:
 Expansion case commencing after project execution and being available for walk-off/walk-on
longwall faces from LW102

MAY 20
 S
 R
Early
appro
Table
A con
with r
shoul
011
Second set o
Required mai
y results from
oximately 37
e 2-14: Expa
Ex
ncept underg
results and re
ld be comple
EA
f longwall ro
intenance sh
m the XPAC s
0,000tpa.
ansion Case
xecution Sch
Schedule A
Scenario C
Difference
ground cost m
ecommenda
eted.
AGLE DOWNS CO
of supports
hutdown peri
schedule sho
e Schedule I
edule
A
C
e
model was a
ations provide
OAL PROJECT 
ods still bein
ow that avera
Impact
lso complete
ed to the JV
 FRONT-END L
ng available f
age LOM RO
Avera
Figure
ed. This will b
to determine
LOADING 3  D
for the mine
OM productio
age Productio
5,497
5,868
370,5
e 2-14: Expans
be included i
e if a detailed
EFINITIVE FEAS
infrastructure
on would incr
on LOM (tonn
,575
,162
588
sion Case Sch
in an evaluat
d expansion
PAGE 55 OF 594
IBILITY STUDY
e.
rease by
nes)
hedule Impact
tion model,
case study
4
t

MAY 2011 PAGE 56 OF 594
2.7 Coal Handling and Preparation Plant
 CHPP will have a throughput of 1,200tph ROM to a standard consistent with a 50-year LOM
 Overall plant yield is expected to be 71.6% on the HCU seam coal, with an ash target of
9.5% and moisture target of 11.5%
 Capital cost estimate for the complete facility was subjected to a high-level risk review to
determine the most likely project cost (P80) – A$306 million
 Average LOM total operating cost was estimated at $6.81/ROMt
 Construction duration will be 28 calendar months from project commitment.
2.7.1 CHPP Design
Design of the Eagle Downs coal handling and preparation plant (CHPP) was based on FEL3/DFS
design criteria. Key design parameters for the generic CHPP included:
 Design life: 50 years
 Annual requirement: 52 weeks per year
 Operating regime: seven days per week, 24 hours per day
 Mechanical availability: >95%
 Process utilisation: > 95%
 Operating hours: > 7,000 hours per annum
 Nominal CHPP feed rate: 1200tph
 Dilution: 5%
 Maximum yield: 80% coarse, 90% fines, 80% ultra-fine
 Minimum yield: 23% coarse, 66% fines, 64% ultra-fine.
2.7.2 Raw Coal
The ROM stockpiling conveyor will discharge ROM coal from the underground drift onto a 150,000t
(live stacking capacity) conical stockpile (live reclaim capacity is nominally 30,000t). The dozer push-
out capacity will be constrained by the lease boundary, drift conveyor trestle locations, site-access
roads and nearby drainage channels. A logistics model is recommended for future works to confirm
stockpile capacities.

MAY 2011 PAGE 57 OF 594
Figure 2-15: Raw Coal Handling System
2.7.3 Coal Preparation Plant
The feed conveyor will transfer coal from the raw coal surge bin to the CHPP (Figure 2-16).
Figure 2-16: CHPP and Adjacent Structures
Raw coal
stockpile
Rotary breaker station
and ROM rejects stockpile
Raw coal
surge bin
Plant feed
conveyor
Raw coal
transfer
conveyor
Raw coal
stockpile
Rotary breaker station
and ROM rejects stockpile
Raw coal
surge bin
Plant feed
conveyor
Raw coal
transfer
conveyor
Floc plant Magnetite
pit
Thickener
2-stage
flotation cells
HBF units
Product
conveyor
Coal
preparation
plant (CPP)
Rejects conveyor
Tailings
dewatering
building
Floc plant Magnetite
pit
Thickener
2-stage
flotation cells
HBF units
Product
conveyor
Coal
preparation
plant (CPP)
Rejects conveyor
Tailings
dewatering
building

MAY 2011 PAGE 58 OF 594
2.7.4 Coal Circuits
2.7.4.1 Coarse Coal Circuit
Figure 2-17: Simplified DMC Configuration
2.7.4.2 Fine Coal Circuit
Figure 2-18: Simplified Fine Circuit Configuration
2 x DMC Feed Sumps
2x Desliming
Screens
2x DMCs
Common
Reject
Screen
2x Product
Screens
To Fine
Coal Circuit
-1.4 mm (ww)
Rejects Conveyor
Product Conveyor
-50 mm
To Correct
Medium Sump
To Dilute
Medium Sump
Coarse Coal
Centrifuges
Plant Feed
2 x DMC Feed Sumps
2x Desliming
Screens
2x DMCs
Common
Reject
Screen
2x Product
Screens
To Fine
Coal Circuit
-1.4 mm (ww)
Rejects Conveyor
Product Conveyor
-50 mm
To Correct
Medium Sump
To Dilute
Medium Sump
Coarse Coal
Centrifuges
Plant Feed
Desliming
Cyclones
Thickening
Cyclones
Desliming Cyclone
Feed Sump
Fine Product Sump
From
Desliming
Screens
To Flotation
Fine Coal
Centrifuges
Sieve
Bend
Reflux Classifiers
Feed Sump
Reflux
Classifiers
To HF
Screen
Product Conveyor
To Desliming
Screen
Desliming
Cyclones
Thickening
Cyclones
Desliming Cyclone
Feed Sump
Fine Product Sump
From
Desliming
Screens
To Flotation
Fine Coal
Centrifuges
Sieve
Bend
Reflux Classifiers
Feed Sump
Reflux
Classifiers
To HF
Screen
Product Conveyor
To Desliming
Screen

MAY 2011 PAGE 59 OF 594
2.7.4.3 Ultra-Fine Coal Circuit
Figure 2-19: Simplified Flotation Circuit Configuration
Tailings Circuit
Figure 2-20: Simplified Tailings Circuit Configuration
Sieve Bend
Underflow
Primary Flotation
Feed Sump
Primary
Jameson Cell
Tailings
Thickener
To Tailings
Filters
Desliming Cyclone
Overflow
Secondary Flotation
Feed Sump
Secondary
Jameson Cell
Product Conveyor
Horizontal Vacuum
Belt Filters
Sieve Bend
Underflow
Primary Flotation
Feed Sump
Primary
Jameson Cell
Tailings
Thickener
To Tailings
Filters
Desliming Cyclone
Overflow
Secondary Flotation
Feed Sump
Secondary
Jameson Cell
Product Conveyor
Horizontal Vacuum
Belt Filters
Tailings
Thickener
Flotation
Tailings
Belt Press
Filters
Rejects
Conveyor
Tailings Filtrate
Sump
Tailings Filter Feed
Sump
Clarified Water
Sump
Tailings
Thickener
Flotation
Tailings
Belt Press
Filters
Rejects
Conveyor
Tailings Filtrate
Sump
Tailings Filter Feed
Sump
Clarified Water
Sump

MAY 2011 PAGE 60 OF 594
2.7.5 Product Handling and Train Loading
Product coal will be stacked by a radial stacker providing approximately 100,000t live stacking
capacity and 10,000t live reclaim capacity (equivalent to a single train) in lieu of the fixed arrangement
outlined in FEL2/FS.
Figure 2-21: Product Handling System
During train loading, product will be reclaimed from the stockpile by two pairs of coal valves in a
precast concrete tunnel and discharged directly onto the train loadout conveyor.
Figure 2-22: Product Reclaim and Train Loadout System
2.7.6 Reject Handling and Tailings Processing
CHPP reject will be conveyed to a 400t reject bin for disposal via trucks. The working volume of the
rejects bin will hold just over one hour nominal CHPP rejects production.
Figure 2-23: Rejects Handling System
CPP
Product
conveyor
TLO bin
Product
stockpile
Product
stacker
Product stacker
transfer station
Elevated conveyor
section to cross
Q100 flood zone
Two-stage
product sampler
CPP
Product
conveyor
TLO bin
Product
stockpile
Product
stacker
Product stacker
transfer station
Elevated conveyor
section to cross
Q100 flood zone
Two-stage
product sampler
TLO bin
Main electrified
rail line
Product
stockpile Product
stacker
TLO conveyor
TLO bin
Main electrified
rail line
Product
stockpile Product
stacker
TLO conveyor
Rejects
conveyor
Rejects bin
Rejects stockpile Sampler
Conveyor takeup tower
and drive station
Tailings dewatering
building
CPP
Rejects
conveyor
Rejects bin
Rejects stockpile Sampler
Conveyor takeup tower
and drive station
Tailings dewatering
building
CPP

MAY 2011 PAGE 61 OF 594
2.7.7 Dry Rejects Emplacement Area (DREA)
CHPP reject will be transported to the DREA by truck. Golder Associates was engaged to perform
preliminary design of the 50-year LOM (110Mm3
) DREA.
Figure 2-24: DREA Location
DREA
CPP area
Service
corridor
Main
rail line
DREA
CPP area
Service
corridor
Main
rail line

MAY 2011 PAGE 62 OF 594
2.8 Approvals
 All approvals have been secured bar the Mining Lease, which is expected to be granted in
June 2011.
Table 2-15: Key Approvals for Project Execution
Approval Legislation Approval
Body
Status
Final EA EP Act DERM Issued on 28 March 2011
Mining Lease MR Act DEEDI Expected to be granted in June 2011
EPBC Act Assessment EPBC Act DEWHA Expected to be granted in June 2011
Plan of Operations EP Act DERM To be submitted prior to project commencement
Approved CHMPs ACH Act DERM Executed and registered with DERM
Design of access road to
ML and turn off from
Winchester Road
Local
planning
Isaac
Regional
Council
Preliminary discussions – required prior to construction
of turn off
Water pipeline easement
crossing
N/A SunWater Engineering designs provided to SunWater. Awaiting
feedback and approval
Electricity transmission
easement crossing
N/A Powerlink Engineering designs provided to Powerlink. awaiting
feedback and approval
Queensland Rail Contracts and Agreements
Access agreement N/A QRN Standard regulated document – once EDCM enters into
negotiation for access to QRN
Connection agreement N/A QRN Commercial terms of entry and exit to QRN. We continue
to request a draft of this document but are yet to receive
it
Access Facilitation Deed
(AFD)
N/A QRN This contract establishes the framework around funding
the QRN connection. Draft not received
Rail Infrastructure
Construction (RIC) deed
N/A QRN Establishes the framework around the construction of
connection to the QRN. Draft not received
Conveyor license N/A QRN Licence to build a conveyor over the QRN. Draft received
Crossing deed N/A QRN Build, operation, management of a level crossing. Draft
not received
Rail haulage agreement N/A QRN This agreement secures above-rail-capacity trains. The
competitive process to secure an operator has
commenced
Maintenance agreement N/A QRN Maintenance. Not to be negotiated until into the
construction phase
Rail Infrastructure
Management Deed
N/A QRN Railway manager and train controller. Not to be
negotiated until into the construction phase. QRN is likely
to be the preferred supplier
Bridge license N/A QRN If the grade separation is required. Draft received.

MAY 2011 PAGE 63 OF 594
2.9 Risk Management
 The project has no fatal flaws or extreme risks
 Business risk analysis identified 59 risks for each schedule option
 Schedule A features two extreme risks relating to delay in project approval and contracted
logistics not being available
 Mitigation strategies have been developed for all risks
2.9.1 Fatal-Flaw Analysis
Fatal-flaw analyses conducted during both FEL1/PFS and FEL2/FS were reviewed to assess project
risks and to identify if any fatal flaws existed within known project options in the current operating and
stakeholder involvement. The analyses predominantly assessed engineering, community,
environmental and land-rights risks. No fatal flaws were identified.
2.9.2 Business Risk Register
EDCM engaged Marsh Pty Ltd (Marsh) to facilitate development of a business risk review/profile for
the Eagle Downs coal project. Specifically, the purpose was to identify and assess business risks so
as to provide EDCM with a high-level overview and assessment of identified risks under each project
delivery schedule. Furthermore, it will assist in prioritisation of risk improvement strategies, as well as
gain better alignment within the project’s overall strategic objectives.
Some 59 risks were identified in the review and assessed as having the potential to impact the Eagle
Downs project under each of the considered delivery schedules. The spread of risks is as follows:
Table 2-16: Eagle Downs Risk Spread
Risk Rating Schedule A Schedule B
Project Sanction Now
(i.e. prior to rail/port capacity being secured)
Project Sanction Later
(i.e. only when rail/port capacity is secured)
Extreme 2 0
High 11 14
Medium 14 12
Low 18 20
Not rated 14 13
Extreme risks include:
Table 2-17: Extreme Risks
Schedule Ref Risk Description Risk Rating
A 3.1 Delay in project approval affects critical path E1
9.1 Contracted logistics not available for developmental
coal (rail, port)
E1

MAY 2011 PAGE 64 OF 594
2.9.3 Study Risk Assessments
Technical risks assessments were conducted for the following studies, utilising EDCM’s Risk
Framework Standard 3.2:
 Underground
 CHPP
 Surface
 Human resources (HR).
A total of 81 risks were identified and assessed using methodology based on AS4360 Risk
Management Standard. For each identified risk, a qualitative total risk review was conducted. Table
2-18 summarises the analysis of the number of risks identified for each risk register:
Table 2-18: Summary of Risk Register Results with Current Controls
Risk Ranking Underground CHPP Surface HR
Extreme 0 (0%) 0 (0%) 0 (0%) 0 (0%)
High 5 (42%) 5 (13%) 20 (39%) 12 (63%)
Medium 7 (58%) 8 (22%) 20 (39%) 7 (27%)
Low 0 (0%) 24 (65%) 11 (22%) 0 (0%)
Total 12 (100%) 37 (100%) 51 (100%) 19 (100%)
2.9.4 Construction Insurances
The term ‘principal-controlled insurance’ means the arrangement by which the principal or owner takes
construction risks and public liability insurance on behalf of the contractor, subcontractors and
principal. The main advantages for EDCM include:
 Influencing arrangements and costing of the covers
 Avoiding additional costs of contractor mark-up in contract negotiations
 Dovetailing the construction insurance program to EDCM’s permanent insurance program
 Reducing risk of uninsured losses, particularly on major projects where there are a number of
contractors/subcontractors on the contract site
 Minimising control problems by effecting its own insurances
 Reducing the risk of contractor/subcontractor disputes, as there will be only one policy in place for
all parties. This will be particularly important in the case of liability claims
 Receiving direct payment of claims, which will negate contractors’ ability to withhold funds.
The construction insurance markets in Australia, London and Asia have been competitive for a
number of years due to significant capacity. In the absence of any market changing losses, this is
expected to continue for the foreseeable future. While there have been significant events of damage
by flood and other weather-related events in recent times, Marsh has not seen these events impact
the insurance market as yet. Marsh will continue to monitor this and advise EDCM if there is a
deterioration of the competitiveness of the insurance market for construction projects.

MAY 2011 PAGE 65 OF 594
2.10 Operations Management
 Eagle Downs is a potential top-tier longwall mining operation
 EDCM has extensive experience at all levels of the underground mining business, gained
from top-tier mines around the country
 EDCM will differentiate Eagle Downs to attract high-calibre employees in a tight market.
2.10.1 Operating Philosophy
Eagle Downs has been designed to compete with the top tier of Australian longwalls. The country’s
top four mines in 2010 – Oaky North, Newlands, Moranbah North and Oaky No.1 – are all in
Queensland and have similar extraction heights to Eagle Downs, as well as similar longwall and
conveyor capacity and technology. Eagle Downs’ position relative to Australia’s top longwalls in 2010
is shown in Table 2-19. However, these mines have demonstrated significant performance
improvement over the last five years, indicating that Eagle Downs’ relative position will have dropped
by the time construction and development of the first longwall has been completed.
Table 2-19: Australia’s Top Longwalls in 2010
LW Rank Mine State Longwall
1 Oaky Nth Qld 8,214,000
2 Newlands Northern Qld 7,825,000
3 Moranbah Nth Qld 5,305,200
4 Oaky No.1 Qld 5,294,000
Eagle Downs Schedule A 2015/16 Qld 5,137,336
5 Kestrel Qld 5,116,800
6 Mandalong NSW 4,855,200
7 Ulan NSW 4,794,100
8 Crinum East Qld 4,637,400
9 North Wambo NSW 4,564,800
10 Beltana, Blakefield South NSW 3,665,800
Source: International Longwall News
The Eagle Downs project team has extensive operational experience in the top-four performing
longwall mines, as well as from North Goonyella and Broadmeadow, also in the Moranbah coal
measures. The team’s experience and know-how has been used throughout FEL3/DFS to ensure that
study providers’ work can be appropriately applied to Eagle Downs, and is achievable. This
experience and know-how will be fundamental to the detailed design that the team will ultimately
operate and manage. Fundamentals of operation include:
 Continuously seeking excellence in production and support activity
 Processed-based organisation – longwall, development, outbye and services, surface

MAY 2011 PAGE 66 OF 594
 Activity 24 hours per day, 363 days per year
 Seven-on/seven-off production and maintenance roster
 Two overlapping 12-hour production shifts per day
 One maintenance window per day (with production capability should conditions dictate continuous
production)
 10-hour shifts for first and last shifts of each tour
– Aids fatigue management
– Provides an extended scheduled maintenance period
 All routine work undertaken by Eagle Downs employees
 Contract labour used for infrequent work, such as conveyor installations and longwall moves, and
for specialist works, such as installation of rated ventilation devices and some maintenance
activities
 Site-based managerial support and leadership of operational excellence
 Brisbane-based transactional, commercial and HR functions, industry engagement, JV
management and strategic planning.
2.10.2 Human Resources
Central Queensland’s labour market is tightening, so EDCM aims to differentiate Eagle Downs by:
 Promoting its brand in the future labour market by living its values during construction
 Ensuring contractor agreements for construction are aligned with EDCM values and do not
introduce legacies that will be detrimental to the operational phase of the mine
 Construction management by future operational leaders
 Offering choice of home location:
– Fly-in/fly-out of southeast Queensland
– Drive-in/drive-out of coastal central Queensland
– Residential in Moranbah with rental assistance
 Acknowledging the needs of current employment generations (Baby Boomers and Generation X)
and new employment generations (Generations Y and Z) in recruitment, learning and
development, and communication and involvement.
The Eagle Downs mine location is seen to offer significant advantages to employees at the major
underground mining centres of German Creek and Oaky Creek. The mine should also be positioned to
provide opportunities for underground workers as Brisbane tunnelling project reach their conclusion.
Ensuring that employees have the necessary skills for their work will be a significant factor in the
mine’s success. Employees will be a mix of workers with prior underground experience and those who
are new to the industry. Past experience will be from many mines with differing conditions, equipment
and managerial/leadership styles. Eagle Downs management will draw on this experience in
developing operating plans and procedures. While this may not be the way that employees have
worked previously, the Operational Readiness Manager and the operations team will develop and
implement programs to induct all employees into the Eagle Downs way of work, while performance
management tools will be used to ensure that those with prior experience are embracing and
embedding the Eagle Downs way and assisting to up-skill others.

MAY 2011 PAGE 67 OF 594
A two-year drift driveage duration will enable EDCM to work with the contractor to introduce some
initial Eagle Downs coal development workers to the mine through the contractor. It is otherwise
intended to engage Eagle Downs crews three months prior to commencement of their roles.
2.10.2.1 Personnel Levels
EDCM developed manning to ensure that Eagle Downs roles and responsibilities, remuneration and
development, and progression of employees will be aligned with the company’s HR strategy.
Organisational Structure
A traditional but proven organisational structure is proposed, with all typical functions covered, as per
many established mines’ organisational structures. Support functions will be categorised within two
departments, with a dedicated function of contracts accountability. The structure was developed to
include six hierarchical levels of reporting, from the General Manager/Site Senior Executive (SSE) to
operator and tradesperson level.
Some 380 employees will be based onsite with total personnel, from manager to crew level but
excluding contractors, indicated in Table 2-20:
Table 2-20: Summary of Site Personnel Makeup
Site Function Employees
Operations support team 92
Production team 214
Engineering team 13
CHPP team 38
Employee support team 11
Contracts team 10
SSE and assistant 2
Total 380

MAY 2011 PAGE 68 OF 594
2.11 Marketing and Logistics
 EDCM has identified rail and port options
 Two schedules have been developed to incorporate port capacity security
 Market research has identified major integrated steel companies and merchant coke
producers for future marketing focus.
2.11.1 Logistics
While Eagle Downs has not yet secured rail and port capacity, logistics possibilities include:
 Ad hoc access to contracted but unused port and rail capacity
 Re-assignment of contracted but unused port and rail capacity
 Contracts for capacity at new ports (and rail contracts for upgraded capacity to complement the
new port capacity).
Shipping through new capacity resulting from the Dalrymple Bay Coal Terminal (DBCT) expansion
should offer the cheapest long-term rail and port solution for Eagle Downs. The project is well
positioned in the capacity queue for DBCT but the timing and cost of the expansion are uncertain and
capacity will not be available for the early years of production.
Wiggins Island Coal Export Terminal (WICET) is likely to be a more expensive long-term option for
Eagle Downs by virtue of the railing distance to the port. It should be noted that Carborough Downs
railed some 500,000t over three months across the Goonyella system to Gladstone in 2008.
Carborough is further from Gladstone than Eagle Downs. EDCM is participating in the WICET Stage
2A study, which is likely to provide port capacity some 18 months earlier than DBCT.
EDCM believes that there are a number of operators that, through changing plans or mine
underperformance, are overcommitted to existing rail and port capacity. Assignment of this surplus
could provide Eagle Downs with capacity until new port and rail capacity is secured. Unfortunately,
operators are not acknowledging their surplus to EDCM and it is believed they regard any surplus as a
commodity that can be better traded on the short-term market.
Ad hoc rail and port capacity does become available on a short-term basis. Eagle Downs’ rail loadout
design will allow the mine to rail to existing and at Gladstone ports, Dalrymple Bay or Abbot Point. The
expansion of Abbot Point in 2012 and the new WICET in 2015 may increase availability of ad hoc
capacity.
After extensive research, EDCM developed two schedule scenarios:
Schedule A
 Project sanction before contracts for port and rail capacity are secured (contracted or re-assigned)
 Development coal reliant on ad hoc or re-assigned capacity
 Longwall coal aligned with commissioning of first available new capacity (WICET Stage 2A).

MAY 2011 PAGE 69 OF 594
Schedule B
 Project sanction upon financial close of the first available new capacity (WICET Stage 2A)
 Development coal not before first available new capacity commissioned.
2.11.2 Marketing
Marketing does not form part of EDCM’s scope. However, the DFS/FEL marketing study identified
major integrated steel companies and merchant coke producers (Table 2-21) for attention in marketing
strategies:
Table 2-21: Target Customers
Country/Region Company
Japan Nippon Steel, JFE Steel, Sumitomo Metal Ind, Kobe Steel and Nisshin
Steel, Mitsubishi Chemicals
South Korea POSCO, Hyundai Steel
China Baosteel, Shougang (Capital Steel), Wuhan, Benxi and others
Taiwan China Steel (incl. Dragon Steel)
India SAIL, Tisco (Tata), RINL (Vizag), JSW, BLA, Gujarat, Saurashtra Fuels
Brazil ArcelorMittal-CST, ThyssenKrupp-CSA, Usiminas-Cosipa, CSN, Gerdau,
Vale (Alpa, CSP, CSU)
France, Belgium, Spain and
former Eastern Europe
ArcelorMittal
UK and Netherlands Tata-Corus
Germany ThyssenKrupp (and HKM), Salzgitter
Sweden & Finland SSAB, Rautauruukki
Turkey Erdemir – Kardemir
South Africa ArcelorMittal
Source: MinAxis

MAY 2011 PAGE 70 OF 594
2.12 Sustainability
 Safety and environmental legislative requirements have been identified and addressed
 SHMS and EMP have been developed and will be improved during project execution
 Community engagement strategy has been developed to mitigate social impacts on
identified external stakeholders
 Climate change and energy efficiency options have been included in design.
2.12.1 Safety and Health Management System
EDCM has developed, documented and implemented a comprehensive Safety and Health
Management System (SHMS) for current Eagle Downs exploration activities. The system has been
designed to accommodate continuous improvement and expansion through the project’s various
development stages, up to and including mine operation. The SHMS formalises systems, standards,
methods and procedures in use or to be introduced, to ensure that EDCM identifies and mitigates risks
associated with principle and other hazards, and to maintain compliance with relevant legislation.
The Queensland Coal Mine Safety and Health Act requires the SHMS to be developed using risk-
based principles by a cross-section of the workforce. For a greenfield operation, the SHMS can only
be developed as the operation progresses. The Project Execution Plan (Annexure 1) provides details
of the implementation plan process.
2.12.2 Social Impacts and External Relations
Existing social issues in the Moranbah community can largely be attributed to expansion of the local
coal mining industry. Resulting impacts include coal industry reliance on block shifts and fly-in-fly-out
(FIFO)/drive-in-drive-out (DIDO) workforce arrangements, and prevalence of accommodation centres
(single persons’ quarters).
Dominant community issues relate to:
 Housing and accommodation
 Accessibility to community services and facilities
 Local community identity and vitality
 Labour force and skill shortages.
Eagle Downs’ cumulative contribution to these social impacts will be managed and potentially,
mitigated by the EDCM Community Engagement Strategy (CES). CES initiatives will ensure that
EDCM continues to work and consult with local stakeholders when making decisions that could impact
the surrounding community.
2.12.2.1 Cultural Heritage
The Barada Barna People were identified as the Aboriginal party for the project in accordance with the
Aboriginal Cultural Heritage Act 2003 (ACH Act). EDCM and Barada Barna have developed and
executed a Cultural Heritage Management Plan (CHMP), which has been registered under the ACH
Act.

MAY 2011 PAGE 71 OF 594
2.12.3 Environmental Management Plan
The Eagle Downs Environmental Management Plan (EMP) was approved under the EP Act on 14
December 2010. The EMP outlines the project’s Environmental Authority (EA) conditions, as well as
environmental impacts identified in the EIS and corresponding proposed mitigation and management
strategies. Many of EDCM’s mining activities will require specific management actions to reduce the
risk of environmental harm. Subsequently, mitigation measures will include best-practice:
 Rehabilitation techniques
 Erosion and sedimentation control
 Waste and land contamination management practices
 Surface water and mine water management
 Dust and noise monitoring
 Vegetation clearing procedures
 Weed and feral animal management.
2.12.3.1 Energy Efficiency
EDCM engaged Energetics to complete an energy efficiency study for the FEL3/DFS design. As an
overriding principle, EDCM requested that each design contractor (AECOM – surface facilities,
Sedgman – CHPP and MCS/MineCraft – mining) incorporate energy efficiency considerations into
their design. Energetics was tasked with collating the results and providing a fourth-party analysis of
each contribution towards best-practice energy use, as well as assessing the project’s future ability to
meet statutory energy and greenhouse gas obligations. The review process, which addressed these
considerations and introduced additional opportunities, supports EDCM’s strategic commitment to
delivering best-possible ‘commercial’ practice in energy and resource use at the Eagle Downs
operation throughout LOM.
2.12.3.2 Climate Reporting
Based on currently available energy and greenhouse statistics, Energetics was asked to clarify the
schemes that will be triggered by Eagle Downs operations and what EDCM’s subsequent obligations
will be at both a corporate and/or site level. Existing programs include:
 Energy Efficiency Opportunities (EEO)
 National Greenhouse and Energy Reporting (NGER)
 Queensland Smart Energy Savings Program (SESP).
Energetics reviewed all relevant Australian programs and Table 2-22 summarises EDCM’s compliance
obligations in relation to these programs:
Table 2-22: EDCM Energy Compliance Obligations
Reporting or Compliance Regime EDCM
Energy Efficiency Opportunities (EEO) 2014
National Greenhouse and Energy Reporting (NGER) 2012
Qld Smart Energy Savings Plans (SESP) 2011
EDCM’s obligation to satisfy Qld SESP program requirements will be voided when the project
registers for the purposes of EEO.

DFS Section 2 Executive Summary

More Related Content

What's hot

Viewers also liked

DFS Section 2 Executive Summary