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Xstrata approves development of Ravensworth North mine

World Coal,

The Xstrata plc board has approved the development of the Ravensworth North opencast mine in the Upper Hunter Valley of New South Wales, Australia for a total investment of US$ 1.36 billion (AU$ 1.4 billion).

Situated within the existing Cumnock Coal and Ravensworth complex, the Ravensworth North opencast mine will produce 8 million tpa of export thermal and semi-soft coking coal at full production, with a mine life of approximately 26 years. The project area encompasses the existing Xstrata Coal Ravensworth and Cumnock operations.

Construction of the mine is expected to commence early next year, subject to the receipt of Development Consent by the New South Wales Department of Planning and Australian Government environmental approvals. The first coal is expected to be delivered in July 2012. It is reported that approximately 250 new jobs will be created during construction of the project.

Peter Freyberg, chief executive of Xstrata Coal, said: “Ravensworth North will play a significant role in the continued growth of our New South Wales operations. The mine will be the culmination of Xstrata Coal’s long-term strategy for the area and combines its suite of mineral tenements and assets to realise the considerable synergies on offer from existing operations.”

Mick Davis, CEO Xstrata, said: “[Xstrata Coal] are continuing the development of 20 significant projects in 2010, totalling US$ 14 billion, putting us on track to take advantage of strong commodity markets and deliver against our objective to grow our volumes by 50% by 2014 and reduce our costs by over 20% over the same period.”

The Ravensworth North project will be jointly owned by Cumnock No. 1 Colliery Pty Ltd (Xstrata Coal) (90%) and ICRA Cumnock Pty Ltd (Itochu) (10%).

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