CM2010 IMPLEMENTATION STRATEGY

1. ACARP Australian Coal Association Research Program CM2010 IMPLEMENTATION STRATEGY Greg Pawley (Xstrata Coal), Bob Miller (Centennial Coal) and John Coughlan (Kestrel) Roadway Development Task Group August 2008

2. ROADWAY DEVELOPMENT CHALLENGE • Significant improvements in longwall production and productivity are continuing to be made, with production doubling every 10 years or thereabouts • Improvements in roadway development are generally failing to keep abreast of longwall improvements • Higher capacity, new generation mines are being planned – 15 Mtpa • Older mines are struggling to survive and it is becoming more difficult to find solutions and successfully apply them • Unlikely that continuing increases in longwall production will be sustainable if current roadway development practices and trends remain unchanged • Longwall sustainability!

3. ROADWAY DEVELOPMENT TASK GROUP • Previous attempts at ‘one off ‘ Company initiatives largely failed: • poor problem scope, planning and organisation • lack of mine involvement and commitment • loss of project champions • poor execution and patience • lack of critical mass to gain OEM support • ACARP considered it an industry wide problem requiring an industry wide approach to fund and resource the necessary improvements • RDTG formed in 2005 to develop and direct a roadmap for targeted R&D to improve roadway development • Initial members included Anglo Coal, BHP Billiton, BMA Coal, Centennial Coal, Rio Tinto Coal, Thiess, and Xstrata Coal, with Austar Coal, Vale and Peabody subsequently joining the RDTG

4. 2005 ROADWAY DEVELOPMENT REVIEW The Review was commissioned by ACARP under direction of RDTG to: • Identify where past wins had been achieved and what lessons had been learnt • Identify incremental and step changes in roadway development technology and systems necessary to: • Enable new generation, high capacity longwall mines to be developed • Provide productivity gains to enable existing mines to compete with the new generation mines. • Identify specific R&D opportunities for new technologies, equipment and associated systems • Build support and commitment for a targeted 7 year R&D program

5. RDTG (ACARP) INITIATIVES Subsequent to the 2005 Review ACARP has supported a number of initiatives, including: • Undertaking benchmarking studies to identify performance trends, and identify factors differentiating performance levels across mines • Staging regular (6 monthly) roadway development operators’ workshops to: • communicate emerging best practice and learn from roadway development improvement initiatives • learn of developments in equipment and technology, and • identify potential areas for targeted research • Conducting a review of the civil tunnelling and underground metalliferous sectors to identify technologies and practices that could potentially be applied to improve roadway development performance

6. RDTG (ACARP) INITIATIVES • Continuing the development of self drilling bolts (SDB) • Developing a polymer based alternative skin reinforcement and confinement system to eliminate the installation of steel mesh and, with SDB, allow operators to be removed from the immediate face • Developing an automated system for installing SDB and mesh, including an integrated logistics and materials handling system from the supplier to the face • Developing a simulation model to: • enable limitations of current development processes to be understood • evaluate potential roadway development technologies and practices prior to committing scarce capital and resources • Developing a handbook to capture the industry’s current “body of knowledge” of roadway development practice for future generations

7. CM2010 R&D STRATEGY • In late 2007 the RDTG took the initiative to develop an integrated R&D strategy aimed at developing a new generation high capacity roadway development system • The intention of this strategy is to provide a framework linking all roadway development related R&D to a common purpose, and to develop a basis for undertaking cooperative R&D between researchers, OEMs, and mine sites

8. An integrated, remotely supervised high capacity roadway development mining system that enables 15 Mtpa longwall mines to be established and sustained with a single mining unit • The system will also enable mining to be safely undertaken under adverse or extreme mining conditions, thus opening up access to reserves previously considered unminable

9. A sustained performance rate of 10 metres per operating hour (MPOH) for 20 hours per day, based on installing primary support of 6 roof and 2 rib bolts per metre advance together with roof and rib confinement measures (mesh) • Improved health and safety through reduced exposure to hazards in the immediate face area

10. By end 2010, demonstrate key enabling component technologies that will form the basis of an integrated high capacity mining system • By end 2010, establish programs that enable the key organisational and technical competencies required to support a high capacity mining system to be developed throughout the industry • By end 2012, demonstrate an integrated, remotely supervised high capacity roadway development system • Progressively reduce the physical demands on personnel engaged in the development process and reduce their exposure to workplace hazards

11. KEY ELEMENTS - CM2010 R&D STRATEGY • Key enabling technologies underpinned by organisational and technical competencies • Project management of R&D and engagement of the corporate sector is essential to bring the CM2010 R&D strategy to fruition Key enabling technologies Organisational and technical competencies

12. Key Enabling Technologies • Develop “self-steering” technologies and systems that enables mining equipment to: • mine roadways in accordance with predetermined survey controls • maintain both azimuth, horizon and grade control within a variable seam horizon, and • totally automate the cutting and loading cycle (including mining breakaways) thus enabling equipment to be remotely supervised • Requires a combination of fundamental and applied research building upon Highwall Mining and Longwall Automation technologies • CSIRO Queensland Centre for Advanced Technologies has demonstrated capabilities

13. Key Enabling Technologies • Develop systems that enables the automated installation of conventional resin anchored bolts, self drilling bolts, and roof and rib mesh, and to feed bolts and mesh to the installation hardware without direct operator involvement • Will require a combination of fundamental and applied research • Joy have prototype carousel bolter and Sandvik have operational carousel bolters (metaliferous sector) that could provide basic equipment platform, whilst CSIRO has developed a range of technologies for the ACBM that could potentially be applied • UOW recently awarded ACARP funding to pursue this initiative

14. Key Enabling Technologies • Develop alternative skin reinforcement and confinement technologies and systems that eliminates the installation of roof and rib mesh and provides an enhanced roof and skin reinforcement medium • Will require a combination of fundamental and applied research • UOW awarded ACARP funding to pursue this initiative in 2007 • Initial research shows considerable promise

15. Key Enabling Technologies • Demonstrate, adapt and refine continuous haulage technologies and systems currently being used overseas for use in Australian longwall mines: • Two continuous haulage systems currently being operated or commissioned in Australian mines, with a third system expected to be ordered 3Q 2008 • Expected to be largely driven by mine sites, with support from and feedback to RDTG • Will predominantly require operational improvement to apply existing technologies with some applied research required to integrate into a remotely supervised, high capacity mining system

16. Key Enabling Technologies • Develop technologies and systems that enables face services to be extended within the 3 minute cut, load support cycle and without direct operator involvement • One monorail system currently being reinstalled at Mandalong with recent orders placed for 3 new monorail systems • Expected to be largely driven by mine sites, with support from and feedback to RDTG • Will predominantly require operational improvement to apply existing technologies with some applied research required to automate installation of monorails

17. Key Enabling Technologies • Develop technologies and systems that enables panel services to be advanced on a continuous basis in parallel with mining operations or alternatively, within scheduled maintenance windows • Expected to be largely driven by mine sites, with support from and feedback to RDTG • May require some applied research to develop extensible conveyors and integrate major services (H/T power reticulation, transformers, etc) into a services management system • May also require some applied research to develop more efficient mine compliant services (eg; pipework)

18. Each of • The roadway development system is built on a number of independent subsystems that remain largely unchanged since their inception some 40 years ago • With few exceptions, new technologies have been adapted to existing machine designs rather than result in any fundamental review of machine design • The integration of emerging enabling technologies into an integrated, remotely supervised high capacity mining system is expected to pose a significant challenge to researchers and OEMs • Adoption of an industry standard communications protocol will be a prerequisite to system integration (as in Longwall automation) • Applied research and design simulation will be necessary to integrate the emerging technologies and subsystems, similar to that achieved with TBMs in the tunnelling sector • UOW and CSIRO are developing a collaborative framework to enable their core expertise to be applied to the task, together with participating OEMs and other key researchers

19. FUNDING - CM2010 • The level of funding required to successfully develop and demonstrate all elements of the strategy over the next 3 -5 years is expected to be of the order of $31M, comprising some: • $8.5M for fundamental, ACARP funded research • $22.5M for capital purchases and operational expenditure associated with the purchase of equipment and conduct of “new technology” trials and demonstrations at mines, funded directly by mines • The RDTG proposes that the fundamental research component be funded by ACARP outside routine funding processes, similar to that adopted for the Longwall Automation Project ($5M) • The RDTG also proposes that a collaborative research mechanism be established to prioritise, facilitate, and coordinate the CM2010 Project

20. FUNDING - CM2010

21. WHY COLLABORATE? • CM2010 is a multi-faceted project beyond the capacity of any individual mining company • Collaboration will enable cost ($), risk and technical resources to be shared • Collaboration will enable underground mine operators to achieve the necessary step change by improving the capability of the overall system • OEMs focus on global, low technology products while the Australian industry is pursuing higher technology solutions to the roadway development challenge • A fragmented Australian market wont develop the critical mass necessary to leverage global OEMs to pursue local solutions

22. COLLABORATION STRATEGY • Discrete “enabling” technologies are separately progressed prior to consolidating research gains into an integrated system • Individual companies champion discrete technologies that best fit their strategic objectives, directly funding the associated research and communicating research findings to member companies , eg: • Company A - remotely operated CM • Company B - automated self drilling bolts and mesh installation • Companies C & D (jointly) - continuous haulage • Company E - integrated panel services and panel advances • ACARP “landmark funding” is utilised to progress fundamental research where required, with in kind support and operational funding from the responsible “technology champion” company • RDTG determines how research gains can be consolidated into an integrated high capacity system , and facilitates industry uptake

23. KEY PRINCIPLES • Participating companies each agree to share the results of any CM2010 related research and/or trials they conduct, and to host site demonstrations for co-collaborators • Collaboration involves the sharing of results, not the sharing of any Intellectual Property that is developed – such IP remains with the developer although they may license co-collaborators • Progress reporting and monitoring to be coordinated by the Roadway Development Task Group

24. WHERE TO FROM HERE • The ACARP Research Committee has confirmed its support for the CM2010 Project and has recommended that ACARP support the Project as proposed • The ACARP Board will review the Research Committee ‘s recommendation at its September 2008 meeting • Subject to the Board’s approval, the Project will kick off in October 2008 with a series of scoping workshops to define the research objectives, outcomes, and work programs for the key fundamental research elements • Expect that Technical Working Group will be established with direct input from mines to provide technical support and direction • ARE YOU INTERESTED IN GETTING INVOLVED?