Coal Mines in Australia's Queensland Brace for Cyclone After Worst Flood

Australia’s Queensland state, recovering from the nation’s worst flood disaster, is bracing for a cyclone expected to hit its northeastern coast within three days, threatening more damage to stricken coal mines.

Tropical Cyclone Anthony has reformed into a cyclone today and is likely to hit the coast between Mackay and Cooktown on Jan. 30 or Jan. 31, Bureau of Meteorology forecaster Rick Threlfall said in a phone interview from Brisbane. It may reach a category two intensity, out of a scale of one to five, with five being the highest, he said. Queensland coal-mining districts may be affected with storms and heavy rain, he said.

Almost two months of torrential rains in the Queensland have killed as many as 32 people, damaged about 30,000 properties, cut rail lines and spoiled crops. Lost coal production may cost as much as A$9.5 billion （$9.4 billion）, with 85 percent of coal mines in the Australian state, the biggest exporter of the steelmaking commodity, “impaired by excess water,” Queensland Resources Council said yesterday.

“Areas of concern at this stage would be the central coalfields area such as Emerald, but pretty much everywhere on that coastal strip and inland could see very heavy rainfalls early next week,” Threlfall said.

Drenched Pits

The floods caused BHP Billiton Ltd. and Rio Tinto Group to declare force majeure, a legal clause that allows producers to miss deliveries. The removal of water from pits is likely to be affected by the “state government’s risk-averse environment regulator,” the lack of pumping equipment and water damage, the Resources Council said yesterday.

Steelmakers in Asia may be forced to pay as much as 78 percent more for three-month hard coking coal contracts starting April 1 after flooding disrupted output, according to Bank of America Merrill Lynch.

Queensland has 57 producing coal mines, according to the Resources Council. It may take between two to three months for normal operations to resume, the government said last week.

On the other side of the continent, Western Australia has removed onshore warnings for Severe Tropical Cyclone Bianca, which caused disruptions to oil output for Chevron Corp., Santos Ltd., Woodside Petroleum Ltd. and Apache Corp.

Bianca, a category three cyclone, was 220 nautical miles west-southwest of the town of Exmouth at 8 a.m. local time today. It’s forecast to weaken as it track southwest before heading toward Australia’s southwest coast, including the Western Australian state capital Perth, by Jan. 30, where it may trigger rain and storms, according to the bureau’s website.