PORT WARATAH COAL SERVICES LIMITED

NEW REGIME AND SITE EXPANSION WILL CREATE CERTAINTY FOR
PWCS AND ITS CUSTOMERS

Port Waratah Coal Services (PWCS) today announced details of a long-term commercial framework intended to provide greater certainty for PWCS and its long term customers.

PWCS is seeking the consent and agreement of the NSW Government to amend the 'common user' lease provisions at PWCS’ Kooragang Island facility to have similar provisions to those in PWCS' Carrington lease. The new system will enable PWCS to give preference to those customers who may not be able to obtain access to coal handling services from incoming coal loading operator, the Newcastle Coal Infrastructure Group (NCIG).

PWCS today lodged a request with the Newcastle Port Corporation (NPC) to allow the changes to take effect from January 1, 2010. PWCS has asked the NPC for formal feedback for the next PWCS Board Meeting in late July.

If approval is given, long-term contracts between PWCS and the relevant coal customers would be signed almost immediately, providing the customers with preferential access and operational certainty and security from 2010.

PWCS Chairman Eileen Doyle said the new framework is critical in order to provide operational certainty for PWCS.

Importantly, the framework underpins further expansion of PWCS’ coal loading facilities.
“PWCS customers not affiliated with the NCIG have clearly indicated their future demand requirements,” Eileen Doyle said.

“Accordingly, PWCS is positioning to further expand its operations and boost coal exports from 102 million tonnes per annum (mtpa) to 113 mtpa.

“Costing $458 million and scheduled for operation in the final quarter of 2009, the latest PWCS expansion will provide our long term customers with both growth and surge capacity.

“The additional expansion involves up-rating two receival and three stacking streams, installation of a new reclaimer and stacker, integrity work plus the replacement of two of the original terminal reclaimers”.

Eileen Doyle emphasised that PWCS -the largest and most efficient export coal loader in the world – will continue to work collaboratively with the Hunter Valley coal industry, which in turn competes with coal ports globally.

Whilst PWCS had argued that the best solution for the Hunter Valley coal industry was to have loading growth solely through PWCS, the NCIG was successful in the tender for NSW Government land to build and operate a third terminal at Kooragang Island adjacent to the PWCS site.

The NCIG has received environmental approval to construct and operate its terminal and has publicly announced that it expects to load its first ship in the second half of 2009.

“With the new NCIG terminal and continued expansion at PWCS there should be sufficient port capacity to meet all coal producer needs,” Dr Doyle said.

“The NSW Government, quite rightly, expects both PWCS and NCIG to develop the necessary facilities to meet their customer’s needs.

“However, there have been no public indications that the proposed NCIG terminal will be an open access terminal. Further, public documents indicate that NCIG capacity is being constructed for its members.

Dr Doyle said PWCS will continue to work with the Hunter Valley Coal Industry to provide all current PWCS customers with certainty of access to PWCS capacity for 2008 and 2009.

Further Information

Eileen Doyle, PWCS Chairman

(02) 4950 4669

Graham Davidson, PWCS General Manager

(02) 4907 2345

[ Back ]