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The starting point is an ambitious expansion program involving a number of key projects within the 1 billion tonne Ensham coal resource – notably::

	Extension of the open cut operations
	Purchase of a $100 million dragline
	Feasibility of underground mining within the Ensham Coal resource
	Upgrading of associated coal handling facilities

The opencut re-development began with purchase of a Bucyrus 8750-63 dragline which was commissioned in January 2007. Pending the necessary approvals, it is also anticipated that the open cut mining areas will be extended in 2007 followed by the development of underground mining operations in 2009/2010.

Existing Operations

Ensham’s mining operations currently comprises five open cut coal mining pits: Pits A,B,C & D either side of the Nogoa River - referred to as the ‘Ensham Project’ - and the ‘Yongala’ pit, which is located approximately 5 km to the North of the main Ensham operation. Total combined production is currently in the vicinity of 9 million tonnes per annum (mtpa).
 

Open Cut Expansion

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Ensham Central Project

A key component of Ensham’s vision is the expansion of its open cut operations through the development of a new pit between the existing Ensham Pits, known as the “Ensham Central” Project.

It is anticipated this project will provide access to an additional 60 million tonnes of high grade resource within Ensham’s existing Mining Lease immediately adjacent to the Nogoa River. The company is currently conducting a comprehensive Environmental Impact Assessment with a view to securing approvals to allow the project to commence in 2007.

Ensham Central Project Environmental Impact Statement Click here for more information......

Multi seam project

Ensham is currently evaluating a multi seam project to enhance its strip ratios and reduce the average cost of production from its open cut operations. The project involves enhanced resource recovery of multiple thin layers of coal overlying the main seam using a selective truck and shovel methods which could yield an additional 20 million tonnes over the life of mine.

Infrastructure

Ensham is gearing up for the incremental expansion of its pit operations with a coal handling infrastructure expansion program. This will add an additional 2 mtpa of crushing capacity. The project also contemplates truck dumping stations and conveyors adjacent the main pits to reduce haulage distance to coal handling facilities. In addition coal washing is being studied in order to assess the oportunity to access premium markets for High Quality Thermal and Coking Coal.
 

Underground Project

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As part of its vision to meet market opportunities over the next 20 years, Ensham is currently undertaking a feasibility study into a high capacity underground mining operation, adjacent to the proposed Ensham Central Project.

The underground operation would enable the recovery of an additional 70 million tonnes of coal and may lead to further underground mining opportunities within Ensham’s Exploration Lease. Underground reserves are extensive with some of the major seams having an average thickness of more than 5.0 metres.

Ensham has commenced an Environmental Impact Statement and comprehensive community consultation program in relation to its proposed expansion program prior to the lodgement of an application for mining approval.
 

Equipment Optimisation Project	TOP

Ensham Resources is delighted with the performance of the second biggest dragline in the world, which it has commissioned at its central Queensland mine.

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Dragline 4

Ensham’s equipment optimisation program is spearheaded by the purchase of a new 6600 tonne Bucyrus 8750 dragline to cater for future expansion of operations and slash unit cost of production from the open cut operations.

The $100 million contract with Bucyrus Australia was commenced in December 2004, with the dragline expected to be commissioned in Q1 2007.

The Bucyrus 8750 is the world’s second largest dragline and will increase stripping capacity by approximately 60% while shaving 75% off overburden removal costs.

A key feature of the Dragline 4 project is the high local content in the steel fabrication and cast components – 85% of which will be supplied and manufactured within Australia.

Construction of the dragline is well under way and involves steel manufacturing, heavy engineering, fabrication and casting components produced in Adelaide, Newcastle, Wollongong, Albury, Mackay, Ipswich and Brisbane as well as in widespread centres in the USA.

Ensham and Bucyrus have entered into a unique collaborative approach involving engineering integrity testing and design enhancements aimed at improving the availability of the dragline and the life of machine components.