We are a significant Australian open-cut miner and a leading metallurgical coal producer and supplier of thermal coal for domestic power generation. We operate the Curragh open cut coal mine near Blackwater in Queensland’s Bowen Basin, the Premier Coal mine near Collie in Western Australia, and have a 40 per cent interest in the Bengalla mine in the Hunter Valley of New South Wales. The Bengalla mine is not covered in this report as it is managed by Coal and Allied and is included in its public reporting. At 30 June 2009 we had 788 people permanently employed, 30 in our Brisbane head office, 472 at our Curragh mine and 286 at our Premier Coal mine. The combined coal production for Curragh and Premier Coal was 13 million tonnes which was seven per cent higher than in the previous year.

For more information on Resources view their online Sustainability Report 2009.

Following a disappointing safety performance last year we have focused on ensuring that our safety management systems, workplace behaviours and operating procedures delivered a significant improvement in this critical area. While we aim to have an incident and injury free workplace, the reduction in LTIs from 19 to 9 and a reduction in the LTIFR from 7.2 to 2.53 is pleasing and indicates that our renewed focus and effort in this area is delivering positive results. Consolidating and improving upon this year’s safety performance will be a priority for 2009/10.

This year a climate change strategy and action plan were developed to optimise, ensure compliance and integrate our various activities in regard to energy efficiency and greenhouse gas reduction. This plan has resulted in an increased focus on energy and greenhouse efficiency and reporting for NGERs, as well as completing our section of the first Wesfarmers Energy Efficiency Opportunities public report.

In regard to supporting our local communities, a further commitment to the Ngalang Boodja Council Aboriginal Corporation aquaculture project in Collie (Western Australia) by Premier Coal and a new national partnership with Life Education Australia have been the highlights. These partnerships have enhanced our already strong support for our local indigenous population and young people in our communities.

Reuse and recycling improved significantly during the year with both mines recycling a total of over one million litres of engine oil for reuse which, combined with the introduction of a waste transfer station at Premier Coal and scrap metal recycling at Curragh, has allowed our sites to reduce their overall environmental impact.

During the year the principal focus of our people strategy has been the reduction of LTIs. This has been achieved through managing our injured employees to ensure they are provided with the opportunity to return to work on alternate duties and targeted training across our business. The reduction in the LTIFR from 7.2 to 2.5, an improvement of 65 per cent, indicates that our efforts to make our workplace injury and incident free are progressing. We will continue to make safety a priority to consolidate and improve upon our performance this year.

A major new initiative this year has been the development and rollout of our Leadership Development Framework which provides us with a common language to describe the behavioural expectations of our leaders. Leadership development workshops were conducted across the business.

A highlight during the year was the achievement of Curragh’s Emergency Response Team which represented Australasia in the World Rescue Organisation challenge in Wales, placing a commendable tenth out of 30 international teams.

During the year we submitted our first Equal Opportunity for Women in the Workplace report. The report was deemed compliant with the Act by the Equal Opportunity for Women in the Workplace Agency.

Improving our waste management practices and efforts in recycling has been a major focus this year. During the year Premier Coal appointed a new waste management contractor and introduced a waste transfer station onsite. In addition, Curragh improved its recycling of general waste by 45 per cent and its recycling of liquid waste by 553 per cent.

Curragh continues to improve its onsite water management and this year achieved a 22.6 per cent reduction in the amount of water used onsite. Premier Coal commenced a dewatering programme, abstracting 2.74 gigalitres of groundwater in preparation for future mining activities and the use of this water is explained in the Wesfarmers Resources sustainability report at www.wesresources.com.au

Premier Coal successfully passed two surveillance audits of its Environmental Management System and was also recertified against the International Environmental Management System standard
AS/NZS ISO 14001:2004. This system assists Premier Coal to manage the impact of its operations on the environment.

Mining activities this year have resulted in disturbance to 575 hectares of land while rehabilitation has been undertaken on 70.3 hectares.

This year has seen the development of a Climate Change Strategy and Action Plan designed to coordinate and drive our response in the areas of energy efficiency and greenhouse gas reduction. The initial focus of this strategy is on optimising our operations by implementing opportunities identified during the EEO process and to ensure that we are able to comply with NGERs reporting.

Greenhouse emissions

Our total direct (Scope 1 and 2) greenhouse gas emissions were estimated to be 707,725 tonnes of carbon dioxide equivalent (CO2e), up 15.2 per cent on last year, and this equates to 4.37 kilograms of CO2e per bank cubic metre (BCM) equivalent, up 8.7 per cent on last year. This includes 57,270 tonnes of CO2e for fugitive gas emissions from Premier Coal which are now required to be reported under NGERs. The major greenhouse gas emissions were fugitive emissions (39 per cent), electricity (26 per cent) and diesel (35 per cent).

Energy use

Our main energy use during the year related primarily to the operation of draglines, our Coal Handling and Preparation Plant (CHPP) and diesel-operated equipment. Total energy consumption was estimated to be 4,314,071 gigajoules, up 29.4 per cent on last year. Our total energy consumption per BCM equivalent was estimated to be 26.6 megajoules, up 22.4 per cent on last year. This energy use is broken down into fuel (83 per cent of total energy consumption) and electricity (17 per cent).

The reasons for these increases are explained in the Wesfarmers Resources sustainability report at www.wesresources.com.au

Energy efficiency initiatives

Through our parent company, Wesfarmers Limited, we are a participant in the Commonwealth Government’s Energy Efficiency Opportunities Program. In 2008 we submitted our first public and government reports as part of the Wesfarmers report.

With the introduction of NGERs the baseline year for our greenhouse emissions and energy intensity will now be 2008/09. This alignment with the NGERs will ensure that in future we will be able to benchmark our performance in a consistent way so that we can accurately report our efforts to reduce greenhouse emissions and energy use.

There were no environmental infringement notices or fines issued to either Curragh or Premier Coal.

Premier Coal had one licence non-compliance related to the offsite discharge of process water and the Department of Environment and Conservation (DEC) was advised of the event.

Curragh obtained approvals for, and commenced a 10.2 kilometres diversion of Blackwater Creek in preparation for mining activities under the existing creek line.

Premier Coal successfully passed an audit of its Environmental Management System and was also recertified against the International Environmental Management System standard ISO 14001.

This year we established a major community health and education partnership with Life Education Australia, the nation’s largest non-government provider of drug and alcohol education. This partnership will enable Life Education Australia to expand its programmes to the south-west of Western Australia for the first time and to increase its presence and reach in central Queensland.

This year Premier Coal announced its continued support for the Ngalang Boodja Aquaculture project which will see the development of a commercial aquaculture business.

Using the London Benchmark Group methodology our contribution to various community-based organisations during the year totalled approximately $856,000.

The final rehabilitation of the former mine void known as Lake Kepwari was completed in preparation for its handover to DEC for recreational purposes. The lake will provide a valued community facility for the people of the south-west region. Construction of recreational facilities for public use of the lake is expected to be completed for the 2009/10 summer season.

During September 2008 Curragh celebrated 25 years of operation and commemorated this occasion with an open day which was a great opportunity for the local community to see the mine in operation and for Curragh to thank the community for the tremendous support it has shown over many years.

The Blackwater International Coal Centre, of which Curragh is a major sponsor, was opened by the Premier of Queensland in August 2008. The Centre is a showcase for the industry and a valuable facility for the Blackwater community.

For further details on our sustainability performance please go to our website www.wesresources.com.au

Our business makes a significant contribution to regional and State economies through job creation, procurement of goods and services, royalties and taxes, and community investment programmes.

In 2008/09, despite the challenges presented by the global financial crisis, we committed to a $130 million project to divert Blackwater Creek. The diversion of Blackwater Creek at the Curragh mine will provide access to additional coal, along with operational efficiencies.