Yancoal Australia, a unit of China's Yanzhou Coal Mining Co, said that production will start next month at its Moolarben power station coal mine in New South Wales, the company’s biggest project.

Mr Brian Flannery MD of Yancoal said that coal will be loaded onto trains at the end of April 2010 or early May 2010, and exported through Newcastle port. Moolarben will ramp up to a capacity of 12 million tonnes per year. Yancoal is formerly known as Felix Resources Limited.

It may be noted that Yanzhou, China's fourth biggest coal producer, won Australian government approval for its AUD 3.5 billion takeover of Felix Resources last year after agreeing to sell shares and base senior executives in the country. Yancoal is part owner of Newcastle Coal Infrastructure Group, or NCIG, which operates a new terminal at the port.

Mr Flannery said that "We are now out in the market to close off finance for stage two of NCIG and we expect that to happen very shortly. The expansion phase will take a further couple of years."

Newcastle Coal, partly owned by BHP Billiton Limited, shipped its first cargo from the Australian port last week after spending more than AUD 1 billion on the facility. The terminal’s annual export capacity is expected to rise to 30 million metric tons in 2011. It has planning approval for 66 million tonnes.

Rio Tinto Group and Xstrata Plc are among mining companies that export the fuel from Newcastle. Port Waratah Coal Services Limited owns the two other terminals at the harbor.

(Sourced from www.bloomberg.net)