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Whitehaven Coal Limited : Annual Report 2011
chairman’s letter We recognise that the scale and nature of our operations demand a high level of corporate responsibility in terms of the safety of our workforce, consultation with local communities and environmental management. Dear Whitehaven Shareholder, 2011 OVERVIEW Whitehaven Coal Limited is the largest and most established coal producer in the Gunnedah Basin, planning to produce approximately 7 Mtpa of thermal and metallurgical coal in the 2012 financial year. We have a reputation for successfully implementing our growth plans and this year was no different. Our open cut mines and Gunnedah Coal Handling and Preparation Plant underwent significant expansion during the year and in the June quarter produced at an annual rate of almost 6 Mtpa. We now have an efficient and flexible open cut production base with significant growth coming from our Narrabri underground mine and the proposed Vickery open cut beyond that. Our Narrabri mine has delivered its first full year of development production and now has four continuous miners operating underground. The Stage 2 surface works, including the Coal Handling and Preparation Plant and fan shaft are nearing completion and the longwall is currently being constructed with a view to commencing longwall production in February 2012. At Vickery, our ongoing exploration work has defined a substantial open cut resource. The development of this operation, which could begin in 2013, would contribute to taking our planned production levels to approximately15 Mtpa over the next five years. SUSTAINABILITY Our mines are the largest employer in north-west New South Wales with more than 450 direct employees and a large number of contract service jobs supported. This direct employment is expected to increase to more than 800 during the next five years as our growth plans are realised. Total operating expenditure in producing coal was approximately $247 million in FY2011, most of which was spent in the local and regional economies. This total operating expenditure is expected to increase to more than $825 million per year by 2015. Royalties paid directly to the New South Wales Government in FY2011 were approximately $28 million, rising to more than $100 million per year by 2015. We recognise that the scale and nature of our operations demand a high level of corporate responsibility in terms of the safety of our workforce, consultation with local communities and environmental management. We are a willing and engaged participant in the various policy debates surrounding regional development and mining. We have stated publicly on many occasions that we are committed to a locally-based workforce and are actively engaged with local councils around the region to assist with long-term planning outcomes to support this objective. Despite the challenges raised by the skills shortage in the regions, we do not believe a permanent fly-in fly-out workforce is a good outcome for either our workforce or the community. As such we are working with local councils as they develop sensible planning to protect and enhance the standard of living for our existing communities, which in turn assists in attracting highly-skilled workers and their families to this region. In terms of the environmental initiatives, we have engaged extensively with local communities and this has resulted in a number of sensible variations to our mining plans. In addition, we have expanded our environmental management team, who are now working proactively with other companies in the Gunnedah Basin to assess and address the cumulative impacts of our combined developments. FINANCIAL PERFORMANCE The company reported net profit after tax (NPAT) of $9.9 million for FY2011. This included a net loss after tax of $63.4 million from significant items. Underlying NPAT (before significant items) was $73.3 million. This performance has allowed us to declare a fully-franked final dividend of 4.1 cents per share, payable on 30 September 2011. SAFETY The safety and wellbeing of our workforce is our highest priority and we are focussing on further developing our safety culture and commitment. Significant progress has been made during the year with an increased number of individual hazard assessments (Take 5s) and toolbox talks as well as improvement in incident investigation and root chairman’s letter 2
Annual Report 2010
Annual Report 2012