The Wall Street Journal Queensland floods force another coal mine closure

US coal miners are rushing to fill the supply vacuum caused by Queensland's floods, with New Hope Corp the latest local to halt production.
The Australian company said today that while no flood damage had yet occurred at its coal mines, damage to transport infrastructure was being assessed.
“Over the past 48 hours very substantial rainfall has occurred in south east Queensland, production activities at all New Hope operations has been suspended,” the company said.
“As rain is continuing to fall in the region and further rains are forecasted, New Hope is currently unable to provide an estimate on of the full impact of this adverse weather.”

New Hope produces thermal coal from its New Acland and New Oakleigh mines in South East Queensland.
The devastating floods across the state has already forced the world’s largest miners to declare force majeure on coal contracts. The declaration across half of Queensland’s coalmines could cost $1.25 billion-plus in production, stripping 40 basis points from first-quarter GDP.
Queensland, the world’s largest exporter of the coal used in steelmaking, earns about $30bn from annual coal exports.

BHP Billiton, Rio Tinto, Xstrata, Peabody Coal, Wesfarmers, Macarthur Coal, Anglo American and Cockatoo Coal have all lost production.
The adverse weather has impacted the entire coal chain in the state and QR National said today it has stopped rail services to mines west of Brisbane because of the flooding and the closure of the rail line on the Toowoomba Range following a landslide last night.

“The network operator, Queensland Rail has advised that it had been unable to assess the extent of damage to the railway caused by the landslide on the range, however early indications are that the impact may be significant,” QR National said in a statement.

The track closure will also affect general rail freight services to south-west Queensland.

The significant hit on supply has seen analysts tip a dramatic rise in the coal price, with estimates it could go higher than the $US300 a tonne reached in 2008 following the January Queensland floods.
US coal companies are reportedly rushing to fill the supply vacuum left by the Queensland flooding.
US coal companies, particularly in Central Appalachia - the world’s second-biggest exporting region for metallurgical coal - are fielding inquiries from overseas buyers.
“It puts us in a terrific position,” Ted Pile, a vice president at Abingdon-based Alpha Natural Resources, told The Wall Street Journal.

- with The Wall Street Journal