Pembroke Resources reported that its Olive Downs coking coal project has been approved by Queensland’s coordinator general and is expected to begin producing next year. Located 40 kilometers (km) southeast of Moranbah in Queensland’s Bowen Basin, a well-established coking coal area with existing infrastructure, the project is backed by its major shareholder, Denham Capital, a leading global energy and resources private equity firm.

“This world-class project will have a production life of almost 80 years,” Chairman and CEO Barry Tudor said. “There is no viable alternative to coking coal in the primary steel production process for the foreseeable future, and Olive Downs will be a major supplier to the world’s leading steel producers and as such, will be a valuable contributor to the Queensland and Australian economy for generations.”

Tudor also said Olive Downs will bring employment and other opportunities to the state’s regional communities. “Our focus is on workers living locally, including in the local economies of Moranbah, Nebo and Dysart, and hiring locally from the surrounding towns of Central Queensland,” he said. “There will be no fly-in, fly-out rosters.”

The first stage of the project will require capital expenditure of A$450 million and will produce 4.5 million metric tons per year (mt/y) of metallurgical-grade coal, which will be exported through the Dalrymple Bay Coal Terminal.

Pembroke awarded an A$184 million contract for the design and construction of a coal handling and preparation plant at Olive Downs, scheduled for commissioning in 2020.

Pembroke has also acquired substantial agricultural property holdings in the area and will operate its pastoral and mining ventures together. The mine will be developed on predominantly cleared land and will not impact strategic cropping land, the company said.

Olive Downs has also entered into an Indigenous Land Use Agreement (ILUA) with the Barada Barna Aboriginal Corp., the traditional custodians of the land. The ILUA will not only provide a commercial benefits package for the life of the mine to the traditional owners, but also instigate an employment program for members of the Barada Barna community.

“We now need to receive a mining lease before we can start construction, but we anticipate starting mining in 2020 and shipping first coal soon after,” Tudor said. “Today’s approval is not only a sign of confidence in this project but also an acknowledgement of Pembroke’s adherence to the highest of standards throughout the approvals process.”