Overview
Stage | Production |
Mine Type | Open Pit |
Commodities |
- Coal (thermal)
- Coal (semi-soft coking)
|
Mining Method |
- Truck & Shovel / Loader
- Dragline
|
Processing |
- Wash plant
- Spiral concentrator / separator
- Dense media separation
|
Mine Life | 43 years (as of Jan 1, 2018) |
HVO is an amalgamation of three previously independent mining operations, namely: Howick, Hunter Valley and Lemington. |
Source:
p. 159
On completion of the establishment of the 51%:49% unincorporated joint venture with Glencore on 4 May 2018, the Group holds 51% of the shares in HVO Coal Sales Pty Ltd, HVO Operations Pty Ltd and HVO Services Pty Ltd (“HVO Entities”). From this date the Group has determined that it no longer controls these companies. From 4 May 2018 the Group equity accounts the financial results of these companies.
The HVO JV is an unincorporated joint venture. Coal & Allied Operations Pty Ltd (a wholly owned subsidiary of the Company) is interested in 51.0% and Anotero Pty Ltd (a wholly owned subsidiary of Glencore) is interested in 49.0% of the HVO Joint Venture.
Summary:
Regional Geology
The HVO/MTW and Ashton assets are located in the Hunter Coalfield, which is located in the northern part of the Sydney Basin. The Sydney Basin forms part of the composite PermianTriassic age Sydney-Gunnedah-Bowen Basin (SGBB) system, which extends for approximately 1,700 km from southern NSW into central Queensland. The SGBB represents a 1,700 km long foreland basin of Early Permian to Late Triassic age. The Sydney Basin is bounded by the New England Fold Belt to the north and this boundary is marked by the structurally complex, Hunter-Mooki Thrust. To the west and south, the basin strata lap onto older rocks of the Lachlan Fold Belt and to the east, the basin’s limit is marked by the edge of the continental shelf.
The Sydney Basin is one of the world’s premier coal provinces containing multiple stacked sequences of thick bituminous-rank Permian age coal measures. The Permian coal measures in the Sydney Basin are only weakly to moderately folded and faulted and as such are generally amenable to high productivity surface and underground mining methods.
The SGBB system evolved during the Late Carboniferous to the Middle Triassic (approximately 310 to 230 million years ago (Ma)) as a series of contiguous basins which formed along the eastern part of the Gondwana continental margin. The SGBB has been subject to a complex, multiphase geological history including early rifting in a back-arc environment and thermal subsidence evolving into a retro-arc foreland basin.
Coal measure sedimentation in the Sydney Basin began in the early Permian and was terminated towards the end of the Permian by major uplift and basin tilting. The earliest Permian units were deposited in fluvial, coastal plain and marine environments on older Palaeozoic basement rocks. This deposition was followed by rapid subsidence in the middle Permian, providing more space for sediment accumulation, with the main period of coal deposition occurring in the late Permian.
The sedimentary pile in the Sydney Basin has asymmetrical thickness distribution. The thickest accumulations are along the easterly-dipping Hunter-Mooki Thrust Fault System suggesting that subsidence was greatest along that fault. The sedimentary sequence thins to the west due to the sediments onlapping into the basement rocks in the west. The Hunter Coalfield is a district- scale north-eastern subdivision of the Sydney Basin. The Permian coal bearing stratigraphic section occurs within the Whittingham Coal Measures.
The Late Permian Whittingham coal measures are the main focus of operations. The existing operations exploit more than 100 individual seams (or seam plies) contained in more than 20 seam groups (or members) across the Vane and Jerrys Plains Subgroups of the Whittingham Coal Measures. Coal seams split and coalesce in various combinations at all stratigraphic intervals.
Whittingham Coal Measures
The Whittingham Coal measures are subdivided in to two Subgroups, namely Jerrys Plains and Vane.
The Whittingham Coal Measures were deposited in a retroact foreland basin during the Late Permian at a time when the Sydney-Bowen Basin complex was undergoing east–west compressional tectonics. The sediments were largely derived from the north (Hunter-Mooki Thrust) and the east, shedding off a contemporaneous high associated with the New England Fold Belt and the already developed Hunter-Mooki Thrust System.
Palaeocontemporaneous highs such as the Loder Dome found in the Lower Hunter area probably influential the coal seam deposition at that time by acting as a basement high resulting in thinner Permian sediment deposition. Subsequent burial, rifting and recent compressional tectonics has all influenced the structural character of the area. The coal seams generally dip to the south and west at less than 4 to 6º.
The Whittingham Coal Measures are typically 100 to 300m thick and where they crop out around the Lochinvar Anticline are 60m to 75m thick. Igneous activity occurred at various stages of geological history, particularly during the Jurassic, Late Cretaceous and Tertiary, after deposition of the coal seams and as such cross cut the coal measures and influence continuity and coal qualities in the local vicinity.
Jerrys Plains Subgroup
The Jerry’s Plains Subgroup represents a complete cycle of terrestrial coal measure sedimentation that is up to 800m thick. Interseam lithologies are typically lithic sandstones, shale and conglomerate, with siltstone, carbonaceous claystone and tuff also occurring throughout the sequence. This Subgroup is the major source of coal mined in the Hunter Coalfield and due to extensive work has been subdivided in various formations and further into seam members.
The Bayswater Coal Member is the lowest coal seam in the Jerry’s Plains sequence and was formed in a back-barrier coal swamp environment. The Archerfield sandstone which occurs below the Bayswater seam represents a phase of prograding beach complex. Deposition of alternating interdistributary bay laminites and upwards coarsening crevasse-splay sandstones occurred in a lower delta plain environment, with the thin and banded Broonie Coal Member and Vaux Coal Member forming part of this sequence. Upper delta plain conditions then resulted in thicker and laterally continuous seams such as the Piercefield Coal Member and Mount Arthur Coal Member, after which lower delta plain conditions were re-established with the deposition of the Glen Munro through to the Whybrow Coal Member. Deposition of the Jerrys Plains Subgroup ended with a marine transgression, forming the base of the Denman Formation. Coal distribution in the Jerrys Plains Subgroup of the Whittingham Coal Measures is more variable compared to that of the Vane Subgroup stratigraphically below. Although the majority of the upper delta plain seams are laterally extensive, some of the largest variations occur in the Blakefield, Mount Arthur and Piercefield coal members. The lowest seam, the Bayswater Coal Member seam, varies in thickness from about 1 to 14 m and has a dull character with high inertinite content. The brighter coals such as the Broonie through to the Warkworth coal members are subject to extensive splitting.
Vane Subgroup
The Jerrys Plains Subgroup and the Vane Subgroup are separated by a marine incursion, which is represented by the Archerfield Sandstone. The Jerrys Plains Subgroup has been subdivided into two formations, namely the Bulga and Foybrook Formations and various seam members.
The lower seams of the Vane Subgroup generally have similar thicknesses and are characteristic of the facies change from lower to upper delta plain deposits, with the Liddell Coal Member being the thickest coal-bearing unit, up to 14m in the Foybrook area. The majority of the seams are characterised by multiple splitting, thus, individual coal seams tend to be thin and of inferior quality to the upper Jerrys Plains Seams.
Deposit Geology
The surface geology of the HVO, MTW and Ashton coal leases is dominated by outcrops of the Jerry’s Plains and Vane Subgroups which form the Whittingham Coal Measures. The main rock types of this subgroup include sandstone, siltstone and conglomerate, which occur with subordinate coal and tuffaceous claystone.
Hunter Valley Operations
HVO is located on the asymmetric southerly plunging Bayswater Syncline. The Auckland area is located on the western flank of the Camberwell Anticline and dips more steeply than the western limb of the Bayswater Syncline. The West Pit is located on the eastern flank of the Muswellbrook Anticline. The Barrett seam outcrops in the east of the Auckland area on the Camberwell Anticline.
Mining Methods
- Truck & Shovel / Loader
- Dragline
Summary:
Company utilises large scale open cut mining methods in open cut mining operations, which include the removal and storage of topsoil material via truck and front-end-loader (“FEL”) methods, drilling of a blast pattern, blasting of fragment rock, excavation of waste material with truck and shovel or excavator in the upper benches and by draglines in lower benches, and digging, loading and hauling of coal via truck and excavator or FEL methods. Open cut mines include HVO, MTW, Stratford Duralie, Middlemount and Yarrabee, as well as portions of Moolarben and Ashton.
Operations.
HVO uses dragline and truck and shovel methods, and is operational 24 hours a day, seven days a week.
Coal is loaded using a combination of loaders and excavators with haulage to the ROM hopper undertaken using rear dump trucks. The operations are supported by additional equipment including dozers, graders and water carts.
All pit end-walls have benched and battered designs based on the existing operation with allowances made for increasing depth of mining. The design provides for mining roadways and catch benches.
Coal loss and dilution factors are also applied and vary by the equipment type uncovering the various coal seams (i.e. excavator/truck versus dragline). Typical roof and floor coal loss thickness ranges from 5-25cms. Typical roof and floor waste dilution thickness ranges from 3- 7cms.
HVO comprises three separate previous mines namely Howick, Hunter Valley and Lemington Assets which included the following:
- The Lemington Mine, which began production in 1971, was acquired and merged into HVO in 2001.
- Coal production began at the Howick Coal Mine in 1968 in what is known as the West Pit at HVO. In 2000 the Howick Coal Mine became part of Rio Tinto's Hunter Valley Operations as a result of the merger with Hunter Valley Mine.
- The Hunter Valley No. 1 Mine began production in 1979.
The HVO site area is approximately 20 km long (North to south) and 10 km wide. HVO is divided into HVO North (HVON) and HVO South (HVOS) which are separated by the Hunter River which flows through the HVO leases. There are a number of current active pits and potential future developments at HVO, with the existing operation producing approximately 20Mtpa of run-of-mine coal which results in approximately 14 to 15Mtpa of coal products.
Pit Limits
YAL completed a margin ranking process using XPAC mine planning software which is a process which attributes revenue and costs factors to a set of discreet block data to estimate the incremental and cumulative margin for each coal horizon. The margin ranking results provide an indication of the economic pit limits and also may assist in strategic planning as it allows the relative ranking of pits from high to low margin. The margin ranking was limited to the extents of the pit shells for HVO. The cost assumptions for the margin ranking include:
- Waste removal costs based on budget forecasts with operational improvements to productivity based on YAL benchmarks.
- Drill and blast costs based on YAL cost data.
- All other onsite costs as per the sites budget.
- Offsite costs updated as per YAL expectations.
Mine Design
Seismic hazard studies were not included in the documents available. However, the region is classified as a low seismicity area and seismic hazard is not a critical design consideration. RPM considers the geotechnical parameters applied to Assets pit designs are suitable and reasonable for the rock types identified.
Coal is planned to be mined from up to 10 separate pits over the life of the mine. Mine designs are generally based on those generated by the Company however have been reviewed by RPM and considered reasonable. RPM notes the following with regards to mine design:
- Some geotechnical issues have had an impact on design such as mining through alluvial land or in proximity to underground workings, however these have not had a significant impact on the operation.
- In the current pits, bedding is inclined in the direction of the highwall and major faulting generally trends perpendicular to the highwall.
- The weakest strata on site is the alluvial material, which requires significant geotechnical and hydrogeological study to confirm impact on pit design and stability.
- The ongoing design criteria used at the site includes input from:
- Regular geotechnical inspections, reviews and design advice from external geotechnical consultants throughout the entire period of mining operations; and
- Inspections and back analysis of any wall failures to demonstrate causes of failure with preventative measures being incorporated back into wall design.
At HVON the current active mining area is the West pit, however there has been recent mining in the Wilton and Carrington pits. West pit is a dragline pit whereas the Wilton and Carrington pits are planned to be mined via truck and shovel methods only. The West pit targets a Barrett seam floor. Coal seams from the Barrett seam at the bottom of the pit up to the Lemington seam are found in the West pit area with the upper seams more developed as the pit progresses down dip to the southeast.
A centre bridge system is used by the dragline at West pit to gain access into each successive cut. The coal beneath the centre bridge is not recovered with a low-wall ramp system used to gain access to the Liddell and Barrett coal seams at West pit. The pre-strip operations are undertaken by electric rope shovels and large hydraulic excavators loading rear dump trucks. Pre-strip waste is placed into the inpit dumps with coal mined by front end loaders and hydraulic excavators hauled to either of the CHPP’s.
Within HVOS, there are two currently operating pit areas; Cheshunt 1 and 2 and Riverview. Riverview pit is located to the west of the Cheshunt pits on the western limit of the HVO lease boundary and has planned to pit limits of approximately 1.2 km wide (west to east) and 1 km north to south. Riverview is a dragline operation with truck and shovel pre-strip with the pit advancing to the south. In the north, the basal seam of the pit was the Warkworth seam (area mined out), with the central area of the pit the Warkworth seam splits away from the Bowfield seam and the floor of the pit is stepped up to a Bowfield floor.
Cheshunt 1 and 2 pits are adjoining mining areas located at the northern end of the HVOS area. The pits are mined by truck and shovel methods with waste being hauled to out of pit / inpit dumps to the north east of the pits either via the eastern endwall or cross pit access between the Cheshunt 1 and Cheshunt 2 pits. A ramp system up the advancing waste dump has been developed which provides access to a number of active dump tip heads. The combined length of operating face at the two pits is approximately 3 km. The pits are developed to the south and southwest and are a subset of the Cheshunt Deep pit extension which is planned in later years of the mine life. Coal seams from the Warkworth seam down to the Barrett seam are identified in the area, however the Cheshunt 1 and 2 pits mine down to the Bayswater seam floor only.
The future pits at HVO are the Cheshunt Deep Pit, Southern, Auckland, Carrington East and Auckland South Pits. The Cheshunt Deep Pit is scheduled to be completed in 2041 at which time the Southern, Carrington East and Auckland South Pits will be developed to maintain the total site production rate of approximately 20Mtpa. As these pits are depleted, the Auckland pit will be developed in 2052 with the operation transitioning to a lower production rate of 10Mtpa before completion in 2060.
At HVO potential underground mining targets have been identified in the Arties Seam, Liddell Seam and Barrett Seam.
HVO Arties Seam
The depth below open cut final voids appears to be sufficient to protect the underground from connection to the surface.
The Arties Seam thickness ranges in thickness from 1.5m to 2.3 m.
Processing
- Wash plant
- Spiral concentrator / separator
- Dense media separation
Flow Sheet:
Summary:
HVO site infrastructure, consisting of two coal preparation plants and two coal loading points, is in reasonable condition however much of the equipment requires ongoing maintenance due to its age. RPM is aware that significant sustaining CAPEX has been provisioned as part of the ongoing maintenance to minimise downtime and ensure utilisation is consistent with the planned production.
HVO Coal Handling and Preparation Plants (CHPP)
HVO utilises two wash plants in the HVO north area. The plants are considered to be well maintained and are capable of typical industry benchmark utilisation of 7,200 hours per year, however ongoing maintenance is required. Debottlenecking of plant circuits where necessary and with a consistent feed of coals to not overload any part of the processing circuit, should enable a total throughput of 21Mtpa, which is in excess of the current mine target of 20.6Mtpa ROM Coal and the potential to produce up to 16Mtpa of Product. The design capacit ........

Reserves at December 31, 2018:
Category | Tonnage | Commodity |
Proven
|
333 Mt
|
Coal (M/T)
|
Probable
|
463 Mt
|
Coal (M/T)
|
Proven & Probable
|
796 Mt
|
Coal (M/T)
|
Measured
|
704 Mt
|
Coal (M/T)
|
Indicated
|
1,430 Mt
|
Coal (M/T)
|
Inferred
|
1,654 Mt
|
Coal (M/T)
|
Total Resource
|
3,788 Mt
|
Coal (M/T)
|
Heavy Mobile Equipment as of December 31, 2019:
HME Type | Quantity |
Cable reel truck
|
1
|
Dozer (crawler)
|
29
|
Dozer (rubber tire)
|
5
|
Dragline
|
2
|
Drill
|
8
|
Excavator
|
8
|
Grader
|
11
|
Loader
|
5
|
Scraper
|
2
|
Shovel
|
3
|
Truck (dump)
|
81
|
Truck (service)
|
5
|
Truck (water)
|
10
|
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