Whitehaven Coal : September 2019 Quarterly Report

QUARTERLY REPORT

22 October 2019

September 2019 Quarter Production Report

Highlights

• Safety performance improved with the TRIFR at 5.14 for the twelve months ended September
• September quarter of 4.4Mt ROM coal production, up 22% on the previous corresponding period (pcp)
• September quarter saleable coal production of 4.9Mt, up 23% on pcp
• September quarter coal sales of 5.5Mt, up 14% on pcp
• Whitehaven executed an agreement with EDF to acquire EDF's 7.5% interest in the Narrabri underground longwall mine which when completed will increase Whitehaven's equity ownership level to 77.5%
• Equipment at Tarrawonga arriving and ramp up to 3Mtpa has commenced
• Rehabilitation has commenced at Rocglen
• FY20 guidance remains unchanged since issued to the market on 15 August 2019

Comments from the MD and CEO Paul Flynn

"It is pleasing to report that safety performance continues to improve, indicating that our efforts to further embed a safety-focused culture as production increases is bearing fruit."

"The quarter represents a solid planned start to the year, which will be second half weighted."

"Our program of improving efficiency continues, with the autonomous haulage evaluation program at Maules Creek entering the final stage of technical testing and commissioning in Q2 FY20. Further, new higher capacity longwall chock legs have started to arrive at Narrabri, ahead of the changeout later this year when we will install higher capacity cylinders to help build resilience against cyclical weighting events."

"Our inaugural Investor Day was well supported and will be a recurring feature in the company's investor relations calendar."

Safety

The safety outcome for the Group improved significantly in the September quarter with the TRIFR falling from 6.16 at the end of June to 5.14 at the end of September. Group TRIFR remains well below the NSW coal mining average of 14.64.

Whitehaven Managed Totals

			Quarter Ended			Year to Date
	Thousands of tonnes		Sep 2019	Sep 2018		Change	Sep 2019		Sep 2018		Change
	Managed ROM Coal Production		4,420	3,619		22%	4,420		3,619		22%
	Managed Saleable Coal Production		4,909	3,981		23%	4,909		3,981		23%
	Managed Total Coal Sales		5,546	4,853		14%	5,546		4,853		14%

Whitehaven Coal Limited ABN 68 124 425 396

Level 28, 259 George Street, Sydney NSW 2000 | 02 8222 1100 | [e-mail] | www.whitehavencoal.com.au

Whitehaven Equity Totals

	Quarter Ended			Year to Date
Thousands of tonnes (including Sunnyside)	Sep 2019	Sep 2018		Change	Sep 2019		Sep 2018		Change
Equity ROM Coal Production	3,391	2,887		17%	3,391		2,887		17%
Equity Saleable Coal Production	3,861	3,267		18%	3,861		3,267		18%
Equity Sales of Produced Coal	4,030	3,649		10%	4,030		3,649		10%
Sales of Purchased Coal	436	406		7%	436		406		7%
Total Equity Coal Sales	4,466	4,055		10%	4,466		4,055		10%
Equity Coal Stocks at period end	1,606	1,446		11%	1,606		1,446		11%

Equity Coal Sales and Realised Pricing

				Quarter Ended
		Sep 2019	Jun 2019	Mar 2019	Dec 2018	Sep 2018
Total Equity Coal Sales	Mt	4.5	4.4	4.9	4.3	4.1
Sales of purchased coal (thermal)	Mt	0.4	0.4	0.5	0.4	0.4
Sunnyside	Mt	0.1	0.1	0.1	0.1	0.1
Equity Own Coal Sales	Mt	3.9	3.9	4.2	3.8	3.5
Coal sales mix (own coal sales)
High CV Thermal Coal	%	65%	65%	60%	69%	60%
Other thermal coal	%	15%	15%	14%	11%	20%
Metallurgical coal	%	20%	20%	26%	20%	20%
Pricing
NEWC Index	US$/t	68	80	96	104	118
JSM Quarterly (SSCC)	US$/t	115	129	132	135	129
Average SSCC spot price	US$/t	86	95	117	122	125
Price achieved (own coal sales)
Thermal coal	US$/t	73	84	97	108	113
Metallurgical coal	US$/t	100	107	120	122	128
Premium/Discount
Thermal to NEWC Index	%	7%	5%	1%	3%	(4%)
Metallurgical to JSM Qtrly	%	(13%)	(17%)	(9%)	(10%)	(1%)
Metallurgical to Spot Price	%	16%	12%	3%	0%	2%

Note: Figures may not add due to rounding

Equity coal sales for the September quarter, including purchased coal, were 4.5 Mt, 10% above the pcp. This sales volume improvement is reflective of the Narrabri production uplift when compared to the pcp, which was impacted by the move to LW107. Equity sales were higher than saleable production for the quarter as a result of drawing down stocks that were built up towards the end of FY19.

The globalCoal Newcastle Index (gC Newc) thermal coal price softened to average US$68/t for the quarter compared with the average price for Q4 FY19 of US$80/t. Whitehaven continues to experience solid end user demand for its high quality thermal coals.

In the September quarter, Whitehaven achieved an average realised price of US$73/t for thermal coal sales, 7% higher than the average gC Newc price for the period. Maules Creek achieved a premium of 17% above the gC Newc index price for its sales of thermal coal in the September quarter, reflecting a greater contribution of fixed quality premiums in the current price environment.

September quarter metallurgical benchmark prices (which use backward-looking 3 monthly average indices) were US$178/t for prime hard coking coal and US$115/t for SSCC.

2

Maules Creek Open Cut Mine

Whitehaven 75%

		Quarter Ended			Year to Date
	Thousands of tonnes	Sep 2019	Sep 2018		Change	Sep 2019		Sep 2018		Change
	ROM Coal Production	1,962	2,268		(14%)	1,962		2,268		(14%)
	Saleable Coal Production	2,034	1,980		3%	2,034	1,980		3%
	Sales of Produced Coal	2,125	2,154		(1%)	2,125		2,154		(1%)
	Coal Stocks at period end	441	476		(7%)	441		476		(7%)

As outlined at the Investor Day in September the focus of Maules Creek's current phase of the mine plan is on reaching the bottom of the pit to allow for in-pit dumping and the development of the south west area of the pit. The development of the south west area will expose more of the Braymont seam which is scheduled to be accessed in the second half of FY20.

Saleable coal production in the September quarter was higher than ROM coal production reflecting the draw-down of higher opening stock levels to support customer demand.

Managed metallurgical coal sales of 0.362Mt in the September quarter represented 17% of the total sales from the mine. For the comparative period in FY19 metallurgical coals sales were 0.601Mt, 27% of total sales, when the Braymont seam was accessed.

The autonomous haulage system (AHS) evaluation program at Maules Creek is progressing well. The final stage of technical testing and commissioning is being undertaken in Q2 FY20. The first AHS fleet, comprising 6 Hitachi EH5000 haulage trucks, is due to be placed into the mine's production area following completion of this stage of testing.

Narrabri Underground Longwall Mine

Whitehaven 70%

		Quarter Ended			Year to Date
	Thousands of tonnes	Sep 2019	Sep 2018		Change	Sep 2019		Sep 2018		Change
	ROM Coal Production	1,793	550		226%	1,793		550		226%
	Saleable Coal Production	1,800	729		147%	1,800	729		147%
	Sales of Produced Coal	1,835	875		110%	1,835		875		110%
	Coal Stocks at period end	949	258		268%	949		258		268%

Q1 FY20 production performance was in line with the mine plan. The significant increase in ROM, saleable coal production and sales of produced coal over the comparative period reflects good production levels at the mine for the quarter and pcp production being adversely impacted by the scheduled long wall changeout from LW107 to LW108.

Saleable coal production for the quarter was above ROM production as high opening coal stocks were draw down to support strong sales demand.

Sales of produced coal of 1.835Mt reflect strong production performance and the processing of high opening ROM stocks.

Coal stocks at the end of the quarter were larger than the comparative period because in the comparative period stocks had been drawn down as a result of the scheduled long wall changeout from LW107 to LW108.

Roadway development, including cut and flit on the Southern side of the Mains, was 7.2 kilometres for the quarter. The level of Mains development for the quarter is in-line with Narrabri's mine plan.

As previously guided, Q2 FY20 production will be impacted by the scheduled 8 week longwall changeout through November and December. New higher capacity long wall chock legs have commenced being received at Narrabri and during this change out these higher capacity cylinders will be installed. The upgrade in support capacity is anticipated to better manage weighting events that occur periodically in the deeper areas of the mine.

3

Gunnedah Open Cut Mines

		Quarter Ended			Year to Date
	Thousands of tonnes	Sep 2019	Sep 2018		Change	Sep 2019		Sep 2018		Change
	ROM Coal Production	665	801		(17%)	665		801		(17%)
	Saleable Coal Production	1,075	1,272		(15%)	1,075	1,272		(15%)
	Sales of Produced Coal	1,124	1,407		(20%)	1,124		1,407		(20%)
	Coal Stocks at period end	612	909		(33%)	612		909		(33%)

Total ROM and saleable coal production from the Gunnedah open cut mines was down on the prior comparative period due to the closure of the Rocglen mine which saw last ROM coal mined in June 2019, as well as the closure of the Sunnyside mine which saw last ROM coal mined in August 2019, as both these operations transition into rehabilitation phase.

Both saleable production and sales were greater than ROM production as opening ROM stock was drawn down to support strong sales demand.

Tarrawonga Mine

		Quarter Ended			Year to Date
	Thousands of tonnes	Sep 2019	Sep 2018		Change	Sep 2019		Sep 2018		Change
	ROM Coal Production	429	438		(2%)	429		438		(2%)
	Saleable Coal Production	510	521		(2%)	510	521		(2%)
	Sales of Produced Coal	575	547		5%	575		547		5%
	Coal Stocks at period end	165	471		(65%)	165		471		(65%)

Tarrawonga ROM and saleable production levels were similar to the prior comparative period. High opening coal stocks were drawn down to support sales and attractive blending opportunities.

During the quarter mining equipment arrived on site in preparation for Tarrawonga's expansion to a 3.0Mtpa ROM production mine. It is anticipated the mobile fleet will be largely commissioned during Q4 FY20.

Werris Creek Mine

		Quarter Ended			Year to Date
	Thousands of tonnes	Sep 2019	Sep 2018		Change	Sep 2019		Sep 2018		Change
	ROM Coal Production	143	167		(14%)	143		167		(14%)
	Saleable Coal Production	408	470		(13%)	408	470		(13%)
	Sales of Produced Coal	340	541		(37%)	340		541		(37%)
	Coal Stocks at period end	346	146		137%	346		146		137%

Werris Creek ROM production for Q1 FY20 was down on the same period in FY19 as the present mining position is not at the same stage of the seam sequence as last year.

For the September quarter, Werris Creek sales were lower than the comparative period.

4

Rocglen Mine

		Quarter Ended			Year to Date
	Thousands of tonnes	Sep 2019	Sep 2018		Change	Sep 2019		Sep 2018		Change
	ROM Coal Production	-	144		(100%)	-		144		(100%)
	Saleable Coal Production	28	195		(86%)	28	195		(86%)
	Sales of Produced Coal	77	202		(62%)	77		202		(62%)
	Coal Stocks at period end	-	103		(100%)	-		103		(100%)

Last coal was hauled from the mine and processed through the Gunnedah CHPP in July 2019. During the quarter the last coal was sold and the mining operations ceased. Rehabilitation at the mine has commenced.

Sunnyside Mine

		Quarter Ended			Year to Date
	Thousands of tonnes	Sep 2019	Sep 2018		Change	Sep 2019		Sep 2018		Change
	ROM Coal Production	93	52		79%	93		52		79%
	Saleable Coal Production	129	85		52%	129	85		52%
	Sales of Produced Coal	133	117		14%	133		117		14%
	Coal Stocks at period end	101	189		(47%)	101		189		(47%)

Last coal was produced from the mine in August 2019. During the quarter mining operations ceased and rehabilitation of the mine has commenced.

5