We speak to the Executive Chairman of Bowen Coking Coal, Nick Jorss, about the company’s successful acquisitions and its tenacious efforts in sustainability.
Australian mining is a highly significant contributor to the country’s exports, whilst also providing substantial opportunities for national employment and local infrastructure. Regionally, Queensland is one of the most prosperous mining states in the country, and the Bowen Basin in central Queensland offers an abundance of coal mining opportunities, which are plentiful and low-cost.
As one of the newest operators in the Bowen Basin, Bowen Coking Coal (Bowen) has taken full advantage of the resource and has grown rapidly via several acquisitions over the previous four years. In the last 12 months, the organisation has brought two of the acquired coking coal mines into production with a third underway, producing over 1.5 million tonnes of run-of-mine (ROM) coal to date.
And yet, despite its recent prosperity, the company still feels the effects of the challenges that face many mining companies across Queensland, such as regulation, increased government intervention, and environmental activism. However, Bowen is working as a team to overcome these challenges, which is one of the most important parts of the job, according to Executive Chairman, Nick Jorss.
“The industry is cyclical and has faced greater headwinds recently from increased government intervention and environmental activism. The flipside is that, as the industry becomes hard for some players to exist in the market, it sometimes creates opportunities for smaller, nimble operators like Bowen,” he opens.
As the industry flourishes, coal demand continues to grow, driven by industrialisation and urbanisation. Subsequently, there is an increased need for steel and low-cost energy, both of which are supplied by high-quality Queensland coal.
“We are resolute that steelmaking coal has a climbing demand trajectory. To make the new steel required for economic growth and decarbonisation we will need more coking coal in the future, and there’s no economical substitute on the near horizon,” Jorss highlights.
Steel is widely regarded as an essential component in electrification, and more steel requires more coking coal. Meanwhile, supply is constrained by an effective capital strike, with regulatory and approval pressures having an additional impact.
These dynamics are favourable, however, to coal as an investment commodity. “With the increasing demand for coal and other minerals, Queensland can be a world leader if we encourage investment.
“We maintain some of the world’s highest environmental and safety standards, best geology, and lowest emissions export coals,” Jorss proudly comments.
Every major investment decision made at Bowen is supported by significant prior work to ensure that assets are well positioned across the pricing cycle. The company never takes any big acquisition lightly, and doesn’t chase growth for growth’s sake. Rather, Bowen rejects acquisition opportunities if they do not align with the specific strategic goal of building more near-term, high-quality and low-cost production assets. Timing is also critical to an investment decision to ensure any assets are acquired at the right time in the cycle, which helps drive long term shareholder value.
Examples of such criteria are evidenced in some of Bowen’s most recent acquisitions, including the Burton Complex, which comprises multiple open pit deposits at Broadmeadow East, Burton and Lenton. The complex, with an annual ROM production target of 3.5 to 4.5 million tonnes, includes a 5.5 million tonne coal handling and preparation plant (CHPP), train loadout facility, 350-person camp, haul road, offices and workshops. The site is located near Moranbah in Burton, central Queensland, producing high-quality coking coal and secondary thermal product.
The company has successfully opened the first low-cost mine within the Burton complex named Broadmeadow East, and is currently opening the second. The first module of the CHPP has been refurbished and is now operating at above the nameplate capacity.
Bowen’s other operating asset is the Bluff Mine which is ramping up to an annual ROM production target of over one million tonnes and produces ultra-low volatile pulverised coal injection (UVPCI). This is located 20 kilometres (km) east of Blackwater in central Queensland.
Further projects under development in Bowen’s portfolio include the Isaac River project, located 30km to the southeast of Moranbah, next to BHP’s giant Daunia mine. Isaac River recently received its important final federal government environmental approval to allow the grant of the mining lease. The Hillalong project, 150km southwest of Mackay, has 87 million tonnes of Total JORC Resource, consisting of low ash coking coal and secondary thermal coal and will form an important extension to the Burton mining complex.
In line with its strategic acquisition choices, Bowen’s employees must also have their hearts in mining.
“There isn’t a lot of ego in the team, just good people wanting to work to create value and have some fun whilst doing it. The ability to work in this collaborative and fast-paced environment to strive for the best result is probably the most important criteria in our team.
“We aim to be nimble and able to respond to opportunities as and when they arise,” he tells us.
“We don’t make any big calls lightly and we don’t chase growth for growth’s sake. as such, we reject many acquisition opportunities if they don’t fit our strategic goal.”
“We don’t make any big calls lightly and we don’t chase growth for growth’s sake. as such, we reject many acquisition opportunities if they don’t fit our strategic goal”Nick Jorss, Executive Chairman, Bowen Coking Coal
A BURGEONING SUSTAINABLE FORCE
Most recent developments in the global mining industry include an appreciation of mining’s environmental footprint. The Australian mining landscape is no different, as being environmentally and socially responsible is not just perceived as good business, but the core of business.
Responsible mining solutions for safety, economic development of communities, efficient extraction techniques and technologies, comprehensive environmental safeguards, and community engagement are all part of the company’s planning and operations from the development of mines to their end of life.
Such a commitment is a key driver for Bowen, as guaranteeing a sustainable industry with a minimal environmental footprint is central to the company’s approach. Regional communities around the Bowen mines rely on mining for their existence and benefit from Bowen’s operations through economic development, opportunities and employment.
To date, more than 700 direct jobs and thousands of additional indirect positions have been generated in Queensland, due to Bowen Coking Coal projects. This includes apprentices and trainees, as well as opportunities with very competitive salaries in regional areas.
In addition, efficient extraction of mining resources is important in supporting sustainable operations.
“Queensland is blessed with great coal resources, and because of this, our industry underpins the global seaborne metallurgical coal market. Our coal quality is high, and our emissions profile is typically low,” Jorss highlights.
Evidently, mining produces sizeable economic benefits to the local communities, despite only ever occupying a small area of land. In Queensland, mining occupies approximately less than half a percent of the land but produces half of the export revenue that supports employment and growth in the community.
“The small amount of land we do occupy is returned to mainly productive uses when mining is completed. Progressive rehabilitation of our sites is critical to Bowen’s approach, and this is built in from the beginning of the mine’s planning.”
In continuation of supporting the local community, Bowen works closely with localised suppliers and contractors. For example, the recent CHPP refurbishment was conducted on time by a highly motivated labour force, who were supported by supplier partners in the local region.
Looking ahead, Bowen’s near-term focus is on safely and efficiently transforming assets acquired in the last five years and reaching the five million tonnes per annum ROM production target by next year.
“We will continue to grow with acquisitions at the right time, but for now we have a fantastic set of assets we need to work hard on to unlock shareholder value,” Jorss concludes.