Morning everybody. Thanks very much for dialing in to our March 2026 quarterly production report.

I'm joined here today as usual with with Kevin Ball, our CFO, and Ian Humphris, our COO. I'll go through the highlights as usual, and try and get to the Q&A section, which I'm sure will be the more interesting part of of the discussion today.

Broadly look, we've had a pretty solid third quarter, which we're we're pleased with to be able to round that out in a way which sets us up well for the fourth quarter. Solid, and I'll go through the New South Wales and Queensland dimensions of that through the highlights section in particular.

Look, our our safety record continues to be very good. We're we're tracking well.

Our TRIFR at 3.2 certainly is a continuation of the momentum we've shown to improving our safety period on period, very positive. Managed ROM at 9.5 reflects the seasonal nature of Q3.

I'm sure everyone's come to expect that a little bit now with us now being a couple of years into our ownership in Queensland in particular. Equity coal sales have been pretty good at 6.8 million tonnes for the same quarter.

Met and coal prices have improved across both fronts, and we'll get to that in a little bit more detail for the reasons for that. They have moved differentially, as you all all know.

On on track for our savings between $60 to $80 million for annualized savings for the year. Now we've given a reference there to net debt at $600 million there, but obviously that's that's a point-in-time type observation, and we've been pretty busy on the balance sheet, we'll talk a little bit about that, not just in the paper, but I'm sure the Q&A as well.

Of course part of the reason for that is the refinancing of our existing facilities stemming from the acquisition now 2 years ago has rounded out very successfully with a bank and a bond issuance, and we are projecting savings there at $50 to $55 million Aussie annually. Over to just the highlights for our two states: Q3 sales in Queensland, well ROM production a little bit softer, Q3 sales have been have been well supported by good stocks and selling those into the market.

We have had some weather up there, so that has caused Queensland ROM production to be a little a little bit lower, but that's not unusual as we all know, at 4.1 million tonnes, 28% down on December, but as I say, wet weather has been very wet up there, and I'm sure we can talk about that too. We have sold relatively well through that period though, at 3.2 million tonnes for the equity sales in Queensland have been pretty good.

Prices as I say have improved, the average price achieved at A$242 for Queensland, and our 12-month average metallurgical coal realizations at 74% of the PLV. New South Wales been strong across both production and sales, which is very nice to see at 5.4 million tonnes.

The equity sales produced coal 3.6 for the quarter, and and our average pricing for the quarter at A$175, or 101% realization for the period. Over the table you can see not just the totals that I've mentioned already, but further further detail, and then also the year-to-date numbers, which is probably the more relevant in terms of where Q3 sets us up for the full year.

The answer to that is pretty pretty good. At 20 29.5 we're in a decent spot in the managed position on sales.

So 9.5 as I mentioned for the quarter itself, reflecting the sort of reflecting the weather-affected patterns that we we have in this quarter. Obviously lower than the 11 that we banked in December, but that sets us sets up us nicely for a strong Q4.

Equity ROM production production there at 7.6 million tonnes: Queensland at 4 million tonnes as I mentioned, 4.1, and New South Wales at 5.4. Both good results, both with decent stocks entering the Q Q4.

We have drawn down, as I mentioned, across some as a result of continuing to sell strongly into the market, and I'll talk a little bit about where that positions us guidance-wise at the end of the presentation. Queensland operations, Blackwater certainly been rain-affected, and lower than where we'd like to be, but at 2.6 million tonnes it was solid, but certainly with the historic rains that we've had through January, February, and March, been very very wet up there.

We have been battling a little bit of water there, as I'm sure as you've seen others report a similar sort of impact in the region, but that we've been able to sell well through that period at 3.1 million tonnes, and so 15% higher than the December quarter. Daunia has has navigated its way through that wet patch pretty well, 1.5 million tonnes ROM for the quarter.

Even though it's slightly down there on on December, that sets us up well up for a good total for the full year, and total sales at Daunia 1.1 million tonnes, broadly in line with December. New South Wales is has held its end of the bargain up pretty nicely at 5.4 million tonnes of ROM, the same.

Maules Creek, Maules Creek done a good job at 3.4 million tonnes, setting itself up well for that that that final quarter of the year as well. Total sales of 2.3 million tonnes is well during that period.

Narrabri has had a few ups and downs, and it's it's down obviously on the December quarter, which is very strong, only totaling a million tonnes for the quarter. We have taken the opportunity to do some work on the wall, as we're committed to a program of more maintenance in this in this wall now that we've committed to making it last longer.

We'll talk about that, but we've also had some geotechnical ups and downs there, which has which has incentivized us to bring a little bit of maintenance forward to bolster the roof supports infrastructure there to manage these geotechnical events. Sales have been solid though, 1.5 at Narrabri, we've sold down well during that period.

Gunnedah uneventful and and solid and consistent across the period, so that's that's also nice to see. From a sales and realized pricing perspective, say for the quarter, 6.8 million tonnes was was a good result.

The Queensland operations, as I mentioned, they average A$242 for the period, so that's up. Obviously our realizations and so on will lag in a rising market, and it's risen across both.

PLV was up, obviously at $235 an average for the quarter, 18% up on on December, and our realized pricing at $170 was 72% of the PLV for met coal sales during that period. The average is 74, as I mentioned a little earlier.

March quarter sales mix comprised 33% of the primary products of our hard coking and semi-hard, and then and achieving 75% of PLV, and 35% for the PCI semi-soft as our secondary products. New South Wales, $175 was solid, 7% up on on the December quarter.

The price improved to an average of 120 across the period, and our realizations were at 121, just slightly over the average of the gC NEWC for the period. Again, just to remind everybody, in increasing pricing periods, we we obviously lag that, and get a benefit of that in a falling period.

In terms of in terms of the market dynamics itself, PLV has certainly strengthened, more related to weather I think rather than anything else, whereas New South Wales definitely has been impacted certainly by energy security concerns, and and obviously the conflict in the Middle East has seen a rise in in the thermal price since the conflict started, but has moderated since that time, I think broadly on expectations that there may be a conclusion to that sooner rather than later, who knows. In terms of longer-term dynamics, nothing changed there.

We we see the market still on both sides of our business, met and thermal, to be structurally constrained from a supply-response perspective, we think that positions us well going forward. On production costs, as I said, we're we're on track for our $60 to $80 million of annualized savings for the year.

Unit costs for the period actually been better than what we recorded for our first half. I'll remind you that was 135 for the first half.

We've actually done better in this quarter, but we are highlighting that obviously with the related impacts on fuel prices that Q4 will not be as good as what we've just recorded in the March quarter. We are guiding to around the middle of our guidance in terms of the cost guidance per tonne of 130 to 145 for the full year impact.

We've given you there a quick assessment in terms of, what $1 means per liter for the cost base of the business, because diesel costs generally 8% of our TOC costs directly, but there's the indirect impact of pass-throughs for diesel price movements in our rail contracts in New South Wales. That that impact, like I say, $1, you'll get about $10 to $11 per tonne on our costs.

Even though we've done very well in March to bring down our costs below where we've done for the first half, we do feel that it's worthwhile just highlighting for everyone that Q4 may reverse that trend slightly, one quarter of four of course in this given financial year, but it's worthwhile highlighting that. As I said before, the balance sheet has come in for a bit of work, and that $600 million that we've referenced there is net debt at 31st of March is is relevant, but has has obviously moved on since we since the post-quarter payments have been made to BMA.

The refinancing has gone very well, very successful on both fronts, the banking and bond side of things. Substantial savings will accrue to the business now, and I'll just draw you to a typo there just in that section.

That reference to $50 to $55 million U.S. is not, it's actually Aussie dollars, our apologies for that.

That is Aussie dollar $50 to $55 million per annum saving, which is very worthwhile. The bond now staggered out obviously in two tranches to 5.5 years and 8-year notes, and so coupled with the $600 million bank facility, a term loan and a revolver, as we previously announced, very very solid, excellent work from our team to bottom that out, and sets the balance sheet up in a pretty good position to go forward, opening up lots of new capital providers to the company, and and a very, very well-supported offer, which I'm sure you can ask plenty of questions of Kevin on that.

In terms of payments post the quarter, that's that's the reason why I referenced that that 600 million probably has moved on. We've obviously paid the second of the third payment, the second and the second and the last of the large deferred payments to BMA.

That $500 million U.S. was paid on the 2nd of April.

The contingent's a little bit more than last year, but that's reflective of an improving coal price, we're estimating that to be about $58 million U.S., which will be paid in July subject to verification process, as normal with that that underlying mechanism. That puts us in the third and final year of the deferred payments, we've got $100 million U.S.

to pay in April of next year, '27. This is the last year of course of the contingent sharing arrangement as well.

Entering the third and final year of those arrangements, which I think has served us well with this acquisition. Be nice to close those out in 12 months' time.

Buyback has been proceeding of course in a modest way. In the quarter, 1.4 million shares have been bought for a cost of $11 million, and year-to-date, 7.7 million shares at $56 million expended on that.

Nothing to note for you on the development projects that I'll that I'll draw out to you, and I'll steer to our guidance as the final piece of the presentation, and that is that we're we're in the right side of the guidance arrangement here, no changes to our guidance at all, steering towards the top end of our ROM and sales doing both doing very well. Of course the one that I've called out already that's moderating is, despite the good performance in March on the cost side of things, we are expecting those fuel prices to flow through into Q4, and so we're saying we'll probably be at the midpoint of guidance on the cost front for this year.

Capital remains on track to be at the lower end of our capital guidance range. With that, I'll round out the presentation.

It's it's been a very good quarter, sets us up well for Q4, and I'll hand back to the operator now to get the Q&A started. Thank you.

Oh, hi Paul and team. Thanks for the call.

I've got a couple on the operations side. If we start with Narrabri, please.

From memory, I think you were in panel 204, and if I think about the cover there, that's likely to be around sort of 200 meters. Please feel free to correct me if I'm wrong.

I guess my concern is that the mine potentially is facing geotechnical issues as we speak today, and as we get deeper in the later panels, I'm just worried, does that continue to get or become a bigger problem as we sort of progress into those sections of the mine? Then holistically as well on Narrabri, given this is an asset that's been somewhat problematic, how are you thinking about it in the whole set in the portfolio?

Does it still remain core given you've got the optionality in Vickery now, and then also you've got plans for Queensland in the later years? That's the first one.

Thanks.

Thanks Rahul, and well done sneaking in front again as the first question. Look, Narrabri has its moments, there's no doubt about it.

Underground mining generally does, and I'm sure you've got equally interesting observations about underground mines generally pretty much across the country. Narrabri does have its place in this portfolio, we have made those decisions as I mentioned, obviously, to put more effort into the maintenance of this particular wall to make this one last longer rather than replacing it, and we think that's still the right decision.

We are in relatively shallow ground, and we'll still be for some time, not to worry too much about the increasing effect of the depth of cover change that we saw in the 100 series panels. You will see that over time, but we're not going to go to the extremities that we went to before in terms of the depth of cover.

We will revert over to the 300 series panels before we get too deep in Narrabri either. We're talking about just extra support, and then lower productivity in those deeper areas, not that they can't be mined, of course.

That's all within plan, but we will be optimizing staying on the shallower side of the mine for as long as possible before migrating into those deeper terrains. With that, we've spent some money on putting some more work into the wall, as well.

As we've got a longer change-out as well to be the final piece of the puzzle to the refurb of the wall in the new financial year, midway through the new financial year, depending on when we pull up. Overall, look, it's been a little bit of up and down, there's no doubt about it.

The team's working hard to make sure we get consistency of production there, but yeah, it still remains a important piece of the puzzle, and even though, as you mentioned, Rahul, we've got good options both with obviously the balance of capital to ramp up Vickery towards approved level, of course, that's certainly an important thing, and then Queensland, you've referenced also. The company does have good options in that regard.

We do see that the capital, reduced as it is from what the original budget was going to be for the stage 3 capital, is still a worthwhile investment in Narrabri, and in fact, very complementary with Vickery once that balance of capital the board commits to that and gets more coal available to us to blend with Narrabri, that actually is a very value-enhancing addition to our portfolio. Let's not forget that Narrabri, even when it has its moments, it's decent quality coal that customers like, and it's cheap on an average cost basis, it does play a role in the portfolio.

That's fair. Paul, the second one's just on Blackwater.

Obviously that was the second asset that had a bit of a softer quarter. You've talked about water management and weather impacts there.

I guess just to probe that a bit further and to understand, is there any further detail you can provide in terms of specifically what actions we can take, I guess, stepping into wet season next year, if there's anything that can be done? Obviously, everyone has suffered the impact of the weather there, your neighbors, etc., as well, but if you want to provide a bit more color on that, thanks.

Yep.

I reckon Ian loves talking about water, he's been talking about water for a couple of months now, why don't I just hand over to Ian, he can tell you what we're doing, both in terms of anticipating, which the team has done good work in anticipating the onset of the weather. I think in relative terms, we've done well to our neighbors.

There's ongoing work here to manage it. Now 2 years in, we're understanding what's there and what isn't there from an infrastructure perspective, and that's helping us map out a plan for the future.

Ian, yeah.

I think you'd be aware that we had just under 500 mil there in the quarter, which is probably about twice what we would have expected. As Paul said, we did a good job last quarter getting the ROM stocks up there, which we saw as far as the sales processing this year.

It has had some impacts on us just with the sequencing and draglines as we've worked through this. The site got good infrastructure in place, we continue to work on that, and yeah, a little bit in and around the sequencing.

The site were able to discharge water during this period in compliance with all of our various sort of limitations, etc., and we continue to work on that. That's probably the first time that's been done and managed well for a period of time.

We've got good water balance models, we continue to work on this, and we'll put the money into the infrastructure as required.

Got it. That's clear.

Thanks, Ian. Thanks, Paul.

Cheers.

Hi Paul and team. Just on the unit costs, flat Q-on-Q, to be honest, quite a good result, all things being considered.

Can you just walk us through the inventory impacts that sort of led to costs achieving that rate? Because there was obviously impacts at Blackwater, diesel, well-known diesel impacts.

Can you perhaps give us a bit of a feel for how those were avoided in 3Q and potentially accrued to 4Q? I've got a follow-up.

Thanks. Yep.

Rob, I'll give you to Kevin.

Thanks Rob. I'd say to you, look, what Ian said is In Queensland, we prepped really well for the wet weather.

We had strong stocks at the top of ramp, we were able to take those stocks and process those. Now those stocks came with a cost.

Really, you've not really seen the impact of inventory come through the unit cost. The unit cost in the quarter was a very strong result, good cost control in Queensland.

The difference, I think, that you're trying to find is you've got an increased balance of New South Wales in that mix in that period, and that will help drive the unit cost in the total business down towards the unit cost out of New South Wales. As Paul said, I think what you'll see over the year is you'll see that swing back in that fourth quarter with a little bit of diesel coming through, and then costs should rise in the fourth quarter, but all of that fits with almost like a 50/50 product mix between Queensland and New South Wales.

We think that cost guidance, but for the diesel rise, would have been probably, I think we say $2 to $3 lower, right, out of the fourth quarter. That'll give you an idea as to where we think costs were going.

I think we're in really good shape to deliver that at the bottom end of guidance, but for the rise in the price of diesel. Now the other side of that the question that was asked an awful lot the last few weeks has been, what does that mean?

Whilst costs have gone up, the revenue line in New South Wales has gone up by more than the cost. At a group level, it's not margin destructive, it's actually margin accretive.

Thank you. Maybe just calling out cost-out initiatives broader in the portfolio, you've still got that 60 to 80 target.

The refi, which I think beat even your own expectations, mid-7s, I think you said, or a 7-handle, and it's come in with a 6. If we look forward around the cost of capital for the business, and what you're thinking about going forward, was there really good appetite for that financing package?

How do you think about being able to roll that in the future and maintaining a capital structure that does sort of maybe run it a little bit of higher debt given it's so competitive?

Look, I'm probably going to say this to you this way: that whole refinancing piece was really well received. The funding for that predominantly came from outside Australia.

The ask on the bond side of the world, the peak volume in that was something like 10.7 billion U.S. There's something like more than 200 investors in that bond who've seen a bond trade up since issuance, which is good to see, because it means we've priced it reasonably well, but we've left enough on the table to make money out of it from people who invested.

It's really well anchored. Here's a stat I don't think that's in the papers: seven of the top 10 real asset managers across the planet participated in the funding.

To your point about WACC, I do think, and I've asked Kylie to look through this and get a bit of work done, the WACC that I think the business has been valued on by analysts has got a little bit of history to it, and that probably needs to be refreshed. The capital stack requires the business to maintain a strong balance sheet, prudent metrics, which is what we intend to do.

We see ourselves having first entered the space as a debut issuer in investment-grade, we see ourselves working hard to maintain that position through the balance of time, because we think that's the better part of the world to access capital. As you can see, it comes at a competitive price.

I think the other side of that is what we have in the market is an instrument that you can now compare pricing on, and you can see on a day-to-day basis where coal trades from a funding perspective. Received, well supported, will continue to be cautious and prudent.

It's the outcome of several years of work in transforming the business, and it's nice to see that recognized by the debt capital markets in the change that obviously the acquisition in Queensland has brought to the business. Not just the change in scale, but our ability to integrate that, restructure it in a way that's improves the margins of what we've bought, and diversified the business in a way that lowers the risk profile.

I think, coupled with the capital allocation framework that we've been running for quite a few years now, I think that's positioned us well, and it's nice to see that that's been well supported by the markets when it's come our turn to particularly enter the bond market and the bank piece as well.

Thank you very much. I'll pass it on.

Good morning Paul and team. Just another question on Narrabri.

You had the 10-day cylinder change-out, and you mentioned the 8-week longwall move scheduled for the next one. Can you just walk us through, well, actually probably more importantly, how should we think about longwall moves going forward?

Will they all need 8 weeks for a little bit more maintenance? Your comments, Paul, maybe suggest not maybe not 8 weeks, but does it does it slightly increase, maybe to to 6 weeks, just trying to understand how we should think about it moving forward.

Thanks.

That's a fair question, John. Look, when we made the decision to re-profile the capex spend at Narrabri and obviously put off the idea of a new wall for at least another 10 years, we were obviously committed to a maintenance program which was going to give the wall a serious birthday.

That was a serious birthday that goes over 2 years. We obviously did the first piece of that with the eight 8-week change-out we've already had.

You couldn't get it all done in one one tranche, that's why it was going to be a 2-year thing. Given the vulnerabilities we've seen with just some of these geotechnical issues, we've taken the opportunity to bring forward a couple more of the elements that we weren't able to do, or which were part of the second longwall change.

We brought a few components of that forward, and that's really just replacing, say, hydraulic cylinders in the chocks, which we felt were just not able to deliver the full strength into the roof that we were requiring. To the extent that some of those were available, we've taken the opportunity to put those in now.

That's been a good piece of work that's well done. The next longwall change, as I referenced and you've cited, certainly is, we're allowing 8 weeks for that, because that is the second and final piece of this rebuild process that we're going through.

Now that's November-December of this year. Then after, then change-out should normalize back to

Normalize. We do have some options if we wanted to spend a little bit of capital to get a small set of sort of cylinders and chocks, you can then run a progressive sort of change-out.

That's all out there, but yeah, we should go away from the 8 weeks back to the sort of 5 or 6, I would imagine. Yep.

Yep.

That helped, John?

Great. That's really clear.

Thank you for that. Then just the second question, just on Queensland stockpiles, I think you drew down about 1.1 million tonnes in the quarter, which was very helpful just with that wet weather.

Can you just talk us through the strategy for Blackwater and Daunia, just trying to understand, well, is there a strategy there, because it was really helpful. Is there an actual strategy to carry stockpiles for insurance, or is it more than that, timing, stronger pricing, just trying to understand the stockpile strategy up there?

Thanks.

Look, drawing down the stocks was obviously part of preparing for the wet season, so that strategy sees us trying to build stocks in the first two quarters of the year knowing that Q3 is going to be variable. That part of the plan was executed well, and allowed us to sell through that period.

The only thing I'd say that our observations now after 2 years of owning these mines is that we probably are going to carry a little bit more stock than what we've carried in the past, or when I say the past, the only last 2 years. We've learned a little bit more about the coal quality and the intra-seam blending on site, and so our conclusion there is that we should actually carry a little bit more stock on site to manage that, because customers have different requirements, and if anything, we probably were a little bit hand-to-mouth in the first year in particular, our second year we want to actually keep a bit more stock on the ground to be able to manage that.

We are ramping up at the same time, as so that says, keep a little bit more on hand. That is a deliberate strategy to try and make sure we can keep adequate stocks during the course of the year to allow the blending, but also the seasonal impacts of production.

Then I guess

in addition to that, the two coal chains work slightly differently, coming out of Daunia, you've got a cargo assembly, you've really got to have your stocks there ready to go when it's available, whereas at Blackwater, well, not only we've got more capacity at site to store the stocks, but down at Gladstone, we also have a far greater capacity, we can manage it slightly differently.

Great. Some great detail.

Thank you for that.

Morning Paul, Kevin, Kylie, and Kevin and team. Thanks very much for the call.

Two from me. I just wanted to start in terms of diesel.

Maybe just a quick comment on your supply visibility. I just wanted to double-check, the sensitivity in terms of cost increase for every A$1, A$1 per liter, is that roughly what you've seen in terms of diesel that you're procuring today versus what you're procuring before the Middle East crisis?

I'll come back with my second question. Yep.

Thanks, Lachlan. Look, diesel, in terms of the first part of that question, we've had no disruption to diesel supply, I suppose which is consistent with not what regional petrol stations are saying necessarily, but what the government is saying more generally in terms of the logistics consistency delivering supply to Australia for the imported component of that, which is the majority, as you know.

From our perspective, despite all the rumpus, we've actually have not had any issues associated with receiving the supplies as required. This is obviously a conversation we're having every day with our two suppliers, and the assurances that they give us continue to be consistent with how it's been from the beginning of the conflict.

As those assurances are only as good as the assurances they're getting, of course, because we're a majority importer in this country. Those assurances are generally coming from places that are processors rather than producers, and so they are also captive to the same assurances that they are getting.

Far so good, and we don't see any issues at the moment in terms of being able to maintain our consistency of production based on the supplies we're receiving. Now the sensitivity analysis, we put that in there for a guide.

I don't think, Kevin, correct me if I'm wrong, but we're not paying the full extra dollar over and above what we are, we're just trying to give you a sense of the sensitivity on that. That's right.

As I say, we're not expecting that that has not been banked in a full extra dollar into the Q4 estimations we're giving you, but there's no doubt it's higher than where we were, and you just have to look at the bowser, it's what, 50 50% more than what you were paying at the bowser, that's if you're down the street. You can see that that's going to have its flow-on impacts through the business more generally at these sorts of levels.

Yeah.

Great, no, thank you. That's great color.

My second question, changing tack a little, this sort of goes I guess to portfolio and what's next. The business is now beyond the lion's share of the BMA acquisition costs, that's gone well, you're well on the way to fully consolidating those assets into the portfolio.

I do wonder though, given the Middle East war and emergent focus on energy security, we've seen ongoing M&A in the sector, and you've obviously repeatedly spoken to the organic growth. Has there been any change in the board's thinking about sort of what comes next?

I suppose, ultimately balancing returns versus growth?

Not quite sure how to answer that one, Lachlan, because that's a big question. Look, I'll try and give you what I can.

Look, our board hasn't changed its mind as to where it's been. It's been pretty consistent over the many years that the business we're in remains an essential piece of the energy puzzle.

Obviously our expansion into Queensland, diversification to met coal reinforces our view of the integral nature that met coal plays in the production of steel and construction and growth around the world more generally. In the short term, obviously this conflict has focused everyone's minds again on energy security, and the thermal side of our business has benefited from that.

As Kevin said earlier, the price of thermal coal has gone up faster than the inflation impacts on our cost base. Metallurgical coal has tightened, but for unrelated reasons, as I say, more weather-related than anything related to the conflict.

That also remains a supply-constrained market as well, we feel pretty good about that. I was wondering whether there was some other question that was coming from your discussion there, or your question.

It hasn't changed our focus in terms of where we see the growth of our business. Certainly Queensland is prospective, but we need to see changes in royalties there before we do anything too much there.

That's pretty consistent with what everybody else would tell you, I think, as well. Assets changing hands, as you can see in the market from time to time, factors that in.

Our optionality obviously to bring on the balance of the production of Vickery in the fullness of time is something the board can turn its minds to once we feel like we've bedded down the process of the integration of Queensland into New South Wales. It's really refinement of the business now that, as you say, the heavy lifting has been done, but there's still plenty of work to be done as far as we're concerned.

We're busy doing that over this year and the next.

morning Paul. I may have joined a little bit late, but I just wanted to try and understand exactly what are the geotech issues at Narrabri.

The last panel it was because you were at the edge of the seam. What is it this time, and is it now behind us?

Do you have visibility over the rest of the panel? Thanks.

Thanks. Look, no, we did talk about that before, the question's relevant.

It's the same, it's the impact of the same. It's being on the edge of the seam and those intrusions from above which squeeze the seam into a height was obviously not conducive to longwall mining, we're further away from those impacts, they are less than the panel before, for sure, but that doesn't mean they've gone away magically in and of themselves.

There's still an impact of that, and we've mapped out the panel, we can see it's less intrusive than the previous panel, but where that hasn't disappeared magically, there's still the impact of that. The convergence of the gear needing its birthday and the incomplete nature of that, of course, we didn't do it all last panel, we've divided up over 2 years and two change-outs to get that work done.

There's areas where the geotech plays up, and obviously the area where you're most vulnerable to that is the area where you haven't finished all that work yet. That's why we've brought forward a couple of these hydraulic cylinders and the change-out that we did over the last 10 days to bolster that whilst we proceed through this panel and to that next change-out in November-December at the end of the year.

Paul, sorry, do you have any visibility then for the next, I guess it is just what, two to three quarters? Cuz the variation's quite stark.

You look at the December quarter, and then almost down 50% into the March quarter. Can you pick them at all, or is it only as you progress through the panel?

Look, I might hand over to Ian, but yes, we can. Can you predict them?

We map them out, yes, the intensity of them. We map them.

How they actually behave on the day, I would say that it's underground mining, you don't have the clarity of that, but we've mapped out all these structures, and they are certainly less than what they were in the previous panel. We know when they're coming, we prepare for them, but how the ground behaves when you get there can be, as you say and you're pointing out, it can be variable.

I think, and, Glyn, in addition to what Paul's saying, those structures, the washouts and things we've talked about, they're at sort of, call it roughly 50% of what we saw in the first panel. We are seeing, as you and I think one of the early callers asked, a little bit more depth, a little bit more cyclical loading, and I think the combination of those two is where we're starting to see these failures.

I guess the condition of the legs and not being able to get the force into the roof is what's compounding that. The structures in themselves and the cyclical loading is all manageable if your longwall health is in the right condition, and that's why we agreed to stop the other day and improve a few of the areas on the wall where we knew we had, I guess, a swarm of legs that weren't working as well as they should have been.

We had access to legs that we could swap out mid-panel.

Yeah. Oh, that's great, Paul.

Just if I look into the next panel, for next calendar year when we get through this next longwall move, does it drop by 50% again, or in terms of the washouts and the intrusive nature? Can you see that far out?

Yeah.

When we do the development roadways, that's probably the best exploration tool that you've got, and so they're largely gone in the next block. Then when we do the work in this extended longwall move to get the condition of the longwall to where we want it to, we're expecting to see far less, I guess, delays associated with those geological conditions.

That's great. Paul, if I could just change tack and maybe just push a little bit more on the answer you gave to Lachlan's question previously.

You said Vickery, once you've bedded down Queensland over this year and next year, you think you've got another couple of years then before maybe you can tackle Vickery? Is that how I should interpret that?

Is there anything you need to do on Vickery if you wanted to accelerate it? Can you go to the board imminently, or is there more permitting or anything else you need to do, re-testing the capex, etc.?

Thanks. Yeah.

That's a reasonable question. I was trying to leave myself some space to maneuver there rather than put the board on notice about something there, Glyn.

Look, the simple answer to the question is that the project's fully approved, and can go ahead tomorrow if the board sanctioned that. The board's seen the feasibility study and likes what they see, but they haven't obviously committed the balance of capital, because we've been busy with Queensland.

It can go ahead at the right time. I'm just not putting a deadline on it, because that's the board's decision.

We're in good shape, we are fine-tuning as we continue to, obviously proceed with just the early mining version of Vickery today. That refinement and also the financing of Vickery, because that's an important piece of the puzzle.

How would we do that? We're exploring the various offers of support from customers and suppliers who would like to assist us in financing the balance of capital at Vickery.

We're using the time now whilst we're not doing anything more than early mining to explore the financing package so that when the time comes, we have not just a feasibility study that the board likes, but a financing package that matches.

Just finally, how much is money left to spend, do you think, how much are we roughly talking?

Look, we talked about $1 billion, and that's roughly where it is. Aussie dollars, I should say.

Okay. Wonderful.

Thanks a lot, Paul.

No worries.

thanks team for taking my follow-up. I just wanted to round out on inventory across Queensland and New South Wales.

Obviously there's been some moves that supported production, etc. How are the open cuts positioned in terms of overburden in advance and inventory through the chains?

Should we be anticipating any sort of restock or steady state or build or drawdowns in the next couple of quarters of drier weather? Thanks.

Look, the next quarter should be good mining conditions. Typically that's been the case, and Q4 is generally rounded out as being pretty solid, and we're expecting that to be the case.

Certainly been better weather in Queensland in particular. New South Wales has obviously had the better of conditions of the two states over the last 3 months.

Having drawn our stocks down, we certainly want to make sure we replenish the stocks, for sure. That will come naturally with the better production and better mining conditions.

In terms of overburden in advance, we're continuing to build that as well. Nothing too notable there, Ian, that you wanted to draw out?

Nothing, nothing. Yeah.

Better mining conditions. As I said, we wanted to keep a little bit more stock on the ground, and so we will be building some of that backlog for sure.

Great. No, very helpful.

Thank you.

Morning Paul, Kevin. Paul, you've covered pretty much everything on the ops.

Just wanted to ask a question on the coal markets. With thermal coal market, any observations you can share just recently with respect to increased demand trends or interest on spot cargoes in Pacific sort of region?

I know that the Atlantic coal prices really given up a lot because we're in shoulder season and haven't really seen probably the oil to coal switching that maybe some have thought, but just any observations you've seen recently in the thermal market?

Thanks Paul. Look, they have been an interesting market.

I would say almost entirely across our portfolio of customers in the thermal side of our business have asked for more tonnes, and obviously that's energy security concerns, that's obviously price of LNG, that's a whole range of factors in there causing them to want to bring forward tonnes. They've asked for more tonnes first of all, most customers have asked for option upside tonnes, and then pretty much consistently across the portfolio, everyone said, can you bring stuff forward?

Now, as you all know, and as we've been talking about just now, it's a game of truck movements or in Narrabri's case slightly different, but you can't bring forward everybody's request to advance tonnes a month or two earlier at the same time. We're doing our best to try and help our customers with that regard.

The strong sales position is evidence of that, but we can't meet everyone's needs, but that is indicative of the concerns that people have, and obviously the rising cost of LNG. That is causing people to want to focus more on the thermal side of their generation portfolios, which is obviously good for us.

That's what we're observing thus far. Now the market's been up and down, and it's at the moment it seems to be if you be so bold as to interpret what the market is telling us, the market seems to be pricing in a conclusion to this conflict soon.

I hope for the sake of everybody concerned that's true, but if that's not the case, then the price will probably gravitate back northwards again. Let's see how that goes.

I hope less conflicts in the world is a better thing, I'd say. Yep.

Thanks Paul. Then just on the met coal market, the same sort of, I guess views.

From a supply-side perspective, I'd say that Queensland's looking pretty well set for the next 6 months, and production should increase. There are obviously some concerns around steel demand I think in the Asia region over the next 6 months, but on the flip side, hearing snippets around Mongolian supply being impacted because of diesel costs and shortages, etc.

Any observations you've on the demand side specifically on met coal?

Nothing noteworthy other than to say that again on that side of the portfolio, people ask you for more tonnes too, but that was happening before the conflict, so that wasn't a new observation, and certainly not driven by the advent of the conflict itself. Certainly seems China's consumption seems to be improving domestically, but the interest out of India for our coal and sales into India have been firming.

That's probably an observation that's now at least 6 months in its duration, I would say. That's an positive underpinning force on the met coal side of our business.

Okay. All right, thanks Paul.

Appreciate it.

Good morning, Paul and Kevin. Most of the questions have been asked.

Just a follow-up on Vickery. Vickery is a semi-soft and thermal coal mine.

Probably the sales price is not as attractive as most met coal mine. From the financing perspective, is Vickery considered a second-tier met coal mine, or it's a thermal coal?

Also, if there's a better option of other inorganic met coal mines in the market that add value to Whitehaven, would you prefer that over Vickery? Thank you.

Thanks Chen, that's an interesting question. A couple things I might just sort of lay out there for you: thermal coal, as far as the thermal coal world is concerned, Vickery will be at the top of the pops.

Its quality is excellent, better than Maules Creek, and so I should just say that. Now the other thing to note, which is interesting, is the semi-soft quality out of Vickery is excellent also, and it's better than Maules Creek's, and a very good competitor for the Hunter Valley semi-softs, no concerns about being able to sell and price that in comparison with those coals in particular.

Now obviously it's not Blackwater semi-soft, that's an incrementally better product altogether coming from a coking seam. Just in terms of how you're thinking about that and where it's positioned, Vickery itself, obviously there's lots of embedded value in Vickery, not just of course the standalone proposition itself, but also all the other benefits that are related to the Vickery impact on our portfolio, particularly in New South Wales.

Whether that be take-or-pay absorption, whether that be blending, as I say, and that's on top of the return that the standalone asset itself would represent. There's a lot of group benefits for that in addition, which we can outline at the time when the board wants to think about sanctioning the balance of capital.

As you rightly point out, we should always consider it relevant to other opportunities that are around, and certainly that is the way we think about allocating out the incremental dollar of capital, including returns to shareholders. Is it better off deploying that dollar to the buyback, say, for instance?

At these prices, I think we should look very closely at that, as we do. It's relevant to that, but there's nothing else in the market that we're looking at that we like.

We look at everything, and so from an M&A perspective, there's nothing exercising our minds along those lines. It's nice to be a company with good options, and a capital allocation framework which informs how we should best deploy that extra dollar.

Sure, thank you very much. Thanks Paul.

I'll pass on.

Thanks everybody for all the good questions and extensive conversations. Thank you.

If you have any further questions based on the results for the quarter, you know where to find us. Rounding out, I think Q3 sets us up well for Q4, let's see how we manage in better weather conditions and a strong performance in Q4.

Looking forward to it. Thank you.