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South32 forecasts 7.9Mt coal production from Illawarra in FY'17, 8.1Mt sales

South32 Ltd. said Dec. 16 that it expects to produce a total of 7.9 million tonnes of coal in 2017, compared to 8.4 million tonnes this year, from its Illawarra metallurgical coal operation in New South Wales, Australia.

In late October, production at the Illawarra operation was affected by the temporary suspension of the Appin Area 9 longwall and lower rates of production at the Appin Area 7 longwall. The company was expecting a salable production loss of about 500,000 tonnes.

Production in the first half of 2017 is estimated at 3.6 million tonnes, which will increase to 4.3 million tonnes in the second half.

Production at the Appin Area 7 is being progressively ramped up to ensure safe levels of gas.

Total coal sales in the full year 2017 are expected at 8.1 million tonnes, compared to 8.3 million tonnes in 2016.

First-half 2017 sales are anticipated at 3.7 million tonnes, with 4.4 million tonnes to be sold in the second half.

Average operating unit cost, including sustaining CapEx, in 2017 is expected at US$83 per tonne, compared to US$80 per tonne in 2016.

On the back of strong improvement in longwall availability and cutting rates, total saleable production in full year 2018 is forecast to exceed 9.0 million tonnes, with a drop in operating unit costs to about US$77 per tonne.