Operational Readiness for a Greenfield Underground Coal Project
This case study centres on Talisman’s advisory role in a greenfield underground coal project. Tasked with facilitating the project’s transition from an opencut to an underground operation, our two-phase approach aimed to extend its lifespan, supporting steel-making coal production for the next two decades. The phases consisted of a gap analysis to form an executable plan, and preparation to make the project ‘shovel ready.’
Background
An opencut miner operates two metallurgical coal mines in the Bowen Basin. As one of the mine projects neared the end of its economic life, the company identified an opportunity to extend this by transitioning to an underground operation. Recognizing the need for experience and expertise in underground coal mining, especially within the challenging Rangals measures, the company engaged Talisman for this project. For the company, this project is a significant opportunity to extend their mining operations, enabling them to continue supplying coal to their customers worldwide.
Approach
Our involvement in the project was structured into two phases. Phase one entailed a Gap Analysis of the project’s pre-feasibility study, including the mine design, technical aspects, and engineering. The aim was to identify what was required to advance the project to an executable plan. The outcomes of this phase were a detailed gap analysis, a strategy, and a project schedule for the operational phase, including the resources required. Phase two targeted operational readiness, to deliver the project to a ‘shovel ready’ state, including having pre-negotiated contracts ready for immediate execution for critical path construction and procurement items. To effectively manage and oversee the project, we established a steering committee comprising Talisman and company representatives. A risk assessment and risk register were developed and regularly reviewed to ensure focus on crucial aspects.
Outcomes
The execution of the project achieved significant milestones. The Technical Day, held in March 2023, served as an avenue to present and evaluate outstanding technical challenges to the investors, receiving positive feedback. Another key achievement was the focus we placed on carbon emissions mitigation. Our team played a vital role in defining the project’s carbon emissions and developing controls for these emissions. An Investor Memorandum, containing comprehensive reports and supporting documentation, was committed for delivery early in 2024. This document will facilitate the final investment decision, pending government approvals. The success of this project not only brought us a step closer to operational execution but also paved the way for future similar investments, reinforcing Talisman’s potential for providing necessary support.