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Whitehaven flags hit to Maules Creek coal output if drought continues

Whitehaven Coal Ltd. warned that a drought may impact future production at its flagship Maules Creek coal mine in New South Wales, Australia, The Australian reported Oct. 18, citing Managing Director Paul Flynn.

The operation's main water source, the Namoi River, was severely impacted by a drought across the Murray Darling basin, according to the report.

Flynn noted that a drought-related disruption at Maules Creek is not expected before mid-2020, but Whitehaven is monitoring the situation. Whitehaven has reportedly acquired additional long-term groundwater sources for the mine but still needs regulatory approval to secure access. Flynn said the company will have a clearer picture of the situation in the coming months.

Whitehaven's Narrabri and Gunnedah coal mines in the state are not expected to face the same risks, Flynn said in the report.

The drought may cause problems for Newcrest Mining Ltd.s Cadia and Evolution Mining Ltd.'s Cowal gold mines, the report said. BHP Group and Yancoal Australia Ltd. have operations in the state's Hunter Valley region, although both companies have yet to flag major water issues. A BHP spokesperson reportedly said the company is monitoring its water usage at the Mount Arthur coal mine.