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South32 to produce 4.5 million tonnes of salable coal at Illawarra in FY'18

South32 Ltd. expects salable production of 4.5 million tonnes at an operating cost of US$130 per tonne in fiscal 2018 at its Illawarra metallurgical coal operations in New South Wales, Australia.

The guidance includes 3.4 million tonnes of metallurgical coal and 1.2 million tonnes of energy coal, according to the company's Dec. 5 release.

The company expects sustaining capital expenditure of US$470 million in fiscal 2018, down from the previous estimate of US$500 million "with two thirds of the reduction associated with the deferral of underground development at Appin."

South32 restarted limited production at Longwall 707 at the Appin mine after completing a review of Illawarra operations.

"We expect to return the Appin colliery to its prior two longwall configuration in the December 2018 quarter, after which we intend to ramp-up Illawarra metallurgical coal production safely and sustainably towards historical rates of more than [8 million tonnes per annum]," the company said.

Sustaining capital expenditure for the Illawarra project is expected to be US$120 million in fiscal 2018, down from the previous estimate of US$150 million, the company said.