Yancoal dispatches its razor gangs to coal mines

LIFE is hard in the mining industry, even for those backed by an Asian superpower.

The Chinese Government-owned Yancoal has pledged to dispatch razor gangs to its coal mining operations - including three in Queensland - as it joins its peers in an unrelenting focus on the bottom line.

In late February, Yancoal posted an after-tax profit of $406 million for 2012, more than $100 million above the year before.

But on Monday, in a presentation released to the Australian Stock Exchange, Yancoal announced it had "set an aggressive target for cost reductions" across its projects, after already cutting its spending by 5% by late last year.

It was now chasing to slice a further 11% from its costs, as it rushed to lower how much it spent producing each tonne of coal.

In one of the final slides of the presentation, Yancoal suggested coal prices would "gradually increase".

Yancoal owns the Yarrabee Mine, west of Gladstone and Rockhampton, plus has a joint venture with Peabody Mining for the Middlemount mine.

It also owns Cameby Downs in Surat Basin near Miles in southern Queensland.

Within the next five years, Yancoal expected to expand both Yarrabee and Middlemount.

Topics:  asx coal mining spending cuts

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