Published: December 8, 2021 |

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The New South Wales (NSW) government has declared Australian-South African mining firm South32’s proposed A$956 million ($671 million) Dendrobium coking coal mine expansion in the Illawarra region as state-significant infrastructure, allowing it to move forward in the approvals process.

The NSW independent planning commission rejected the proposal in February because of its potential detrimental impact on drinking water supply for the state’s capital city of Sydney. The NSW deputy premier and resources minister Paul Toole has overruled this finding and allowed South32 to move forward in the approvals process by submitting a revised plan directly to the planning minister.

The proposed expansion of the underground Dendrobium mine would maintain the current approved capacity of the mine at 5.2mn t/yr but extend the mine life to 2036, with current reserves set to be depleted by 2024.

Dendrobium was declared of state significance because it is a critical source of coking coal for the 2.1mn t/yr Port Kembla steelworks at Wollongong, which is operated by Australian steelmaker BlueScope, according to Toole. The NSW state government has also granted critical infrastructure status to BlueScope’s planned reline of a blast furnace at Port Kembla.

Dendrobium also supplies coking coal to the Liberty Primary Steel Whyalla steelworks in South Australia and exports coking coal through the Port Kembla coal terminal.

South32 expects to produce 7.5mn-8mn t/yr of coking and thermal coal from its NSW Illawarra coal business over the medium term, up from 7.3mn t in the fiscal year to June 30, which is lower than the 7.65mn t produced in 2020-21, largely because of longwall moves at its 4.5mn t/yr Appin mine in the region. South32 expects its Illawarra coal production costs to rise to $101/t in 2021-22 from $87/t the previous year, as it reduces the proportion of low-margin coal wash material sales.

Source: World Energy

About South32
South32 is a globally diversified mining and metals company. Its purpose is to make a difference by developing natural resources, improving people’s lives now and for generations to come. They are trusted by their owners and partners to realize the potential of their resources. They produce bauxite, alumina, aluminium, metallurgical coal, manganese, nickel, silver, lead, and zinc at its operations in Australia, Southern Africa, and South America. With a focus on growing their base metals exposure, they also have two development options in North America and several partnerships with junior explorers around the world.

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