Pike River Coal (PRC) expects to crank up to 150 staff by June next year when it plans to be in full production.

The West Coast underground coal mine in the Paparoa range, 46km north of Greymouth, posted a loss of $1.14 million yesterday for the year to June 2008.

That reflects the mine still being in its development stage.

Chief executive Gordon Ward said the company raised $182 million in the past year to fund the development and had invested $100m in the past year.

The result saw the share rise one cent to 190c yesterday.

First premium coking coal production from the mine was due by the end of September, two months behind the earlier target of July.

Recruitment had gone well, with 70 people now “on the ground” and another 20 or so to join the company in the next two months.

Pike had been recruiting here and overseas and South Africa had proved to be good hunting ground for experienced mining employees, he said.

For the June, 2009 year Pike still expected to produce 200,000 tonnes. Pike has a price of $US300 a tonne for the 100,000 tonnes it expects to produce in the March quarter 2009.

Ward said he expected benchmark prices set by BHP Billiton and Rio Tinto would come through in March for the March 2010 year.

Pike said broker consensus forecasts saw hard coking coal prices rising a little to just over $US300 a tonne for the March 2010 year, then falling to about $US120 by 2013.

Big investment house Citigroup had prices rising even higher, to $US350 a tonne for the March 2010 year and falling to $US250 by 2013.

Ward said Pike’s two Indian shareholders were contracted to buy 53% of the coal and contracts with two Japanese steel mills took that to 70% of coal production sold for the first three years.

Volumes were contracted in the agreements but prices were negotiated each year.

Pike was a $240m project, fully funded, Ward said, and expected to produce 18 million tonnes of coal over an 18-year mine life.

There might be another 3m to 5m tonnes in the Brunner seam, being mined first.

In the coming year Pike would be undertaking some drilling investigations of the other Paparoa coal seam.

Ward said the most exacting task was the 2.3 km tunnel to the Brunner coal seam. It was nearing completion but the final section was revealing “variable rock conditions”.

The $1.14m loss in the year to June 2008 compares with 881,000 in the previous year.

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