I would like to now hand the conference over to Douglas Thompson, Managing Director and CEO. Douglas, please go ahead.
Thank you, Andrew. Good morning, and thank you everybody for joining us for our full year results presentation. I'm Douglas Thompson, Managing Director and CEO. I'm joined by our Group Chief Financial Officer, Barrie van der Merwe. Today, we'll take you through our performance, the transformation journey that is underway across our portfolio, and how these actions position us for a strong 2026. We'll also highlight the delivered projects, our liquidity improvements, and we'll talk about our guidance. Before we start, please note the important normal notices that need to be provided at these meetings. Today's presentation includes summary information, references to U.S. GAAP and non-GAAP measures, and forward-looking statements subject to risk and uncertainties. We encourage investors to review the filings and the reconciliations provided in the appendix. 2025 was a year of execution.
We advanced our strategy and delivered record production in the second half of the year, reduced our costs materially, and completed key growth projects that set the company up for the future. Coronado is a leading global producer and has a full range of metallurgical coal products. Our portfolio of long life assets provides leverage to high growth steel markets, particularly India, supported by a diversified customer base across five continents. In 2025, we delivered major projects on time and on budget, and materially improved our liquidity, and reset our Stanwell arrangements to support long-term stability and cash generation. Coronado was founded in 2011, when our chairman and major shareholder, EMG, set out to build a high-quality metallurgical coal company by targeting long life, low-cost assets in low-risk jurisdictions. Their investment framework focused on product quality, operational efficiencies, and inherent expansion potential.
The reserve expansion at Curragh, SRA, and then Mammoth and Buchanan expansion projects are aligned to the strategy and have been delivered at far better than industry competitive capital intensity per ton, adding significantly to the life of the portfolio since inception and enabling lower cost. All assets have repaid their original acquisition costs, and we've continued to focus on higher return capital allocation. Importantly tonight, is that the returns provided $1.5 billion of dividend to shareholders. Margin expansion in 2026 is underpinned by the Mammoth Underground and the Buchanan expansion. The combined steady-state cost benefit is expected to be approximately $300 million per annum from these. With a total investment of $255 million, the weighted average payback is around nine months for these projects.
These already demonstrated returns clearly validate the strength of our investment decisions, the fact that the projects were delivered on time and on budget, and with exceptional payback, underscores these projects and the team's performance. Beyond the delivered projects, we have an attractive pipeline across the Mammoth phases and Buchanan's CHPP capacity expansion, and plus Curragh's extensions, with concept from concept to execution pathways and disciplined capital. These projects comprise expansions and life extensions of our operations and are generally low capital intensity and expect to provide very quick paybacks. While we have a clear and attractive pipeline of growth, our near-term focus remains firmly on strengthening our liquidity, de-leveraging through disciplined cash generation this year.
Turning to Mammoth 2, this is a project that is in pre-execution phase, an underground bord and pillar expansion, targeting first coal in 2028, with capital investment around $150 million and a payback roughly of 2 years. Costs are expected to be in the second quartile, which will further average down the group's overall cost. The execution of Mammoth 2 mirrors the successful execution of Mammoth Phase 1 further south in the mine. We can also highlight that the coal quality remains strong and that the degas program is progressing well, showing encouraging signs for productivity while effectively managing coal seam gases. Since 2022, we have executed the One Curragh Plan and the US Uplift Program, driving productivity gains and structural cost out.
The average mining cost per ton has decreased significantly. Saleable production reached new heights in the second half of 2025. Operationally, we achieved approximately $100 million of cost savings from fleet reductions in 2024. A further $160 million of mining cost reductions in 2025. Dragline productivity has improved to be above 50% of total waste movements. In the U.S., skip capacity increased by 45%, which has liberated our two longwall mines underground. Liquidity strengthened with a new covenant light ABL, a prepayment, and critically, the Stanwell rebate is waived in 2026, which provides material uplift. I'll now hand over to Barrie to discuss our full year financial performance before we return to talk about guidance and some of our priorities for 2026.
Good. Thank you, Douglas, and good day, everyone. In FY 2025, we realized material benefits from the dedicated work of our teams over the last couple of years. In particular, I'd like to thank and commend Douglas for the work he did with the team over the last couple of years to set Coronado up for the future. Douglas, you are leaving a lasting legacy at Coronado, and we'll miss you very much once you leave us in the coming months. On slide 12, the charts on the left shows how the momentum of the improvements built up over the course of last year, and our production cost per tonne and CapEx changed half on half. At Curragh, we delivered material cost reductions and improved mining productivity, predictability, and capacity, with the bottleneck now shifting to the processing plants. The mine's inherent financial risk also reduced materially.
The new Stanwell arrangement significantly lowers the cost base by removing the rebate that underpins financial sustainability in lower quality periods through a coal prepayment facility. Curragh is highly leveraged to the coal price and is well set to capitalize on a rising coal price environment, while the Stanwell arrangement provides downside protection when price and cash levels come down. As Douglas said earlier, Buchanan is a quality, high-returning asset. The operation self-funded the recent expansion project and generated $74 million of EBITDA at a 15% margin in a very weak FY 2025 market. With the debottlenecking of the materials handling system complete and a new longwall configuration ensuring mining continuity, Buchanan is well set to capitalize on improved market conditions and generate cash in 2026.
The completion of the expansion projects, together with the other operational improvements over the last couple of years, now firmly place our operations in the second cost quartile. Even in ramp-up phase and a lower coal price environment, the expansions generated $15 million of incremental operating mine cash flow before downstream costs and royalties. In FY 2026, the CapEx spend is reducing materially and returning to the normal sustaining CapEx range of around $150 million required for our installed capacity following the expansions. Across the business, ongoing cost management and discipline remain an important priority, with attention concentrated on the few major cost categories that drive the majority of our spend. We have been strengthening our commercial team, especially at Curragh, where contractors execute most of the mining and represent the largest portion of our spend.
We're also in the market for the re-tendering of some of our mining service contracts with a view of improving our cost position. Turning to slide 13 now, to look at how our cash flows will be different in FY 2026 when compared to FY 2025. As I said earlier, being highly leveraged to the coal price and having the Stanwell protection when prices fall, sets us up very well to capitalize on higher prices in FY 2026. Compared to FY 2025, without any price increase, there's up to $400 million of additional cash inflows. These are structural, sustainable inflows that's driven by the reset of the Stanwell arrangement, our successful expansion projects, and transformation work by Douglas and the team over the last couple of years.
The rebate forgiveness in FY 2026 will be for a full year, while the deferral of FY 2025 was only for part of the year, and the prepayment from Stanwell can be higher than last year. This can add up to $150 million compared to FY 2025. As we said many times, following the expansions, CapEx will be about $85 million lower. The expansions will add about $300 million at mine level, a $285 million increase on FY 2025. We have to pay royalties on the incremental revenue from the expansions, incur a bit of variable downstream processing and logistic costs for the additional volumes from the expansions, and then following FY 2025, where there was a large focus on cash conservation, we have to spend some more money on sustaining mine development at Buchanan and Curragh.
All up, all of these elements of cost will be about an additional $120 million, as shown on the chart. Those are the, the structural, sustainable increases. If you then turn to the bottom of the chart and look at the impact price can have on cash flows, at about $220 per tonne, which is about consensus, compared to the $188 per tonne that we achieved as a PLV index in 2025, cash flow uplift from this is about $350 million. The, the price impacts almost as much as the structural benefits that, that we have.
Of this, about 30 cents of every dollar will have to be paid to the Queensland Government as a royalty, as we now get into that AUD 230 per tonne price threshold, where the royalty steps up from 20%-30%. At AUD 250 per tonne PLV, that uplift increases to AUD 700 million, and at that price level, the royalty will jump up to 40 cents of every dollar as a state royalty. Last thing to mention, if you think about our cash flows, is that we do incur Curragh's operating cost in AUD, and a 1 cent FX change over the course of a full year is about a AUD 15 million cash flow impact. At a high level, 1 cent FX for a year is about AUD 1 per ton on the group's cost.
I'll now turn to slide 14 for a brief overview of our position with Stanwell. As we said before, Curragh is critical to Queensland's energy system and economy, providing about 10%-15% of the state's electricity as a baseload fuel source. Curragh's continued operation therefore remains a strategic priority for Queensland, the reset of Stanwell arrangement reflects this essential role. While the new arrangement provides permanent financial relief in the form of ceasing the export rebate that would have ended early in 2027, it provides material coal prepayment facilities when the cash balance is below $250 million. Having the cash flow effect of supplying thermal coal to Stanwell market prices. When the cash balance is above $250 million, Stanwell continues to be entitled to legacy discounts.
When the cash balance is above $300 million, Coronado provides free coal until such time as the previously provided prepayments are either repaid or the cash balance drops back below $300 million. Amounts prepaid remains contingent on the cash balance until the end of the company's life. The return for the liquidity support, Stanwell has rights to call for longer and more nomination flexibility. The new arrangement includes the provision of an asset-based lending facility by Stanwell, who is now alongside our high-yield noteholders, a major senior lender to Coronado, and is thus even more aligned to our continued sustainability than before. The structure directly underpins Curragh's long-term viability, providing liquidity protection aligned with the cyclicality of the met coal market and our working capital needs. On slide 15, we'll now discuss liquidity and the capital structure.
As I said at the quarterly production report, no working capital levers were pulled at December 2025, and we have the full $173 million of cash available in the business. On top of this, we have approximately $100 million of other liquidity levers that could accelerate cash flow by 6 to 8 weeks, providing adequate liquidity to manage working capital requirements through the planned low production March quarter. As of yesterday, our cash balance was almost the same as the cash balance at year-end. You would also expect our cash position in the March 2026 quarter to benefit from an index price that was about $15 per ton higher in the December 2025 quarter than the September 2025 quarter.
As and when credit ratings improve, we may be able to start clawing back some $70 million of cash from backing guarantees that became a requirement during FY 2025. We continue to have no near-term debt maturities, there are no maintenance covenants in the notes. The Stanwell ABL, endorsed by the Queensland Government, includes no EBITDA covenants until 2028, further supporting flexibility and availability of the facility. Once the EBITDA covenant kicks in, they are more favorable than market covenants, requiring gearing to be below 80%, while the market is usually around 30 and interest cover of 2 times. Importantly, the notes traded up meaningfully, moving from 63% low in May 2025 to about 95% in February 2026, evidencing the material improvement in our credit quality.
Pleasingly, pleasingly, the Financial Provisioning Scheme has also confirmed no requirement for us to provide surety, which was, in our view, the logical conclusion, considering the extent of Stanwell government-owned corporations' financial support of Coronado, and the requirement for Coronado to provide surety would have contradicted the supportive stance from the rest of the state. It's important to note that the financial statements that we put out today are prepared on a going concern basis. There are not any substantial doubt about going concern, as was the case and as was disclosed in the last couple of sets of quarterly financial statements. This is the result of a culmination of all the work the team have done over the last couple of months to improve our operations and financial position materially. On slide 16, we will look at how we are thinking about balancing financial risk and returns going forward.
As Douglas said earlier, since the IPO in 2018, we have returned approximately $1.5 billion to shareholders in dividends. That's a significant return of capital. The current exchange rate, this approximates AUD 2.1 billion, and it is testament to the quality of our asset portfolio. Following a period of optimization and expansion capital in a rising coal market, we are well set to generate cash. Having gone through a difficult financial period, during which net debt peaked at $530 million, it brought liquidity to the forefront of our thinking. That does take an important position in our capital allocation framework. Our first capital priority will therefore be to maintain adequate liquidity, which we estimate will be around $300 million....
It aligns well with the latest Stanwell transaction, which requires us to repay prepayments with free coal when cash exceeds $300 million. This repayment to Stanwell, together with cash built up on the balance sheet, reduces the net debt position and results in de-leveraging of the balance sheet. By building some cash and de-leveraging, we also reduce the company's financial risk profile and move the enterprise value from the debt to the equity side of the ledger. This drives the share price higher. When available liquidity is around $400 million, funds can be allocated to some of the low capital intensity expansion and life extension projects that Douglas spoke about earlier. Note that both the amount and the tenure of the available liquidity will play a role in decision making.
These thresholds are not hard and fast and are always under the board's discretion, depending on the business circumstances and market conditions, but serves as a broad rule of thumb on what can be expected in terms of our thinking on financial risk management and capital allocation. Debt reduction will continue to be achieved through building cash against gross debt, a strategy that simultaneously improves liquidity and drives de-leveraging, and refinancing will either be done at maturity of facilities or company circumstances, and market conditions provide a window of opportunity to do so. Following a tough FY 2025, we are well set for a much better FY 2026. I'll now hand you back to Douglas to talk through priorities and the 2026 guidance. Thank you.
We go to slide 17. In 2025, priorities focused on completing our expansions, improving reliability, and positioning the business for the 2026 uplift that Barrie has described. Guidance frames a path to lower costs and stronger margins. For 2026, saleable production guidance is 16 million-17 million tonnes, and mine cash costs per saleable tonne produced is $88-$96 a tonne, and our capital expenditure is between $150 million and $175 million. This range reflects the uplift from Mammoth Underground and Buchanan expansion, but is offset by about 2 million tonnes from the Logan reductions. Our 2026 framework delivers increased volumes at lower incremental cost, lower capital after the expansions, further optimization at Curragh, and a liquidity structure that provides downside protection.
We expect materially improved profitability and cash, and we have the optionality to progress Mammoth 2 when appropriate within the business. We've built a team who have the capacity and the resilience to deliver the 2026 plan and beyond that. With that, I'll hand over to Andrew, and we'll take your questions.
Thank you, Douglas. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you are on a speakerphone, please pick up the handset to ask your question. The first question comes from Daniel Roden, from Jefferies. Daniel, please go ahead.
Good day. Thanks, Doug, and, yeah, thanks for asking, taking my question. I just want a really quick one for me, just on Mammoth. You know, you noted the restart on the 18th of, of February. I guess for the 2026 guidance, you're still assuming a full 2 million tonne run rate from that in 2026. I just wanted to clarify, does that guidance take into account the period that Mammoth has been out of production for at the start of the year? Does that imply a stronger, I guess, higher than normal utilization and average run rate for the rest of the year to make up that 2 million tonne guidance for 2026?
Daniel, yes, it does, it does consider the unfortunate incident that we had at Mammoth at the beginning of the year. The impact is probably one month's production, so it's one twelfth of the impact, as we did report. The team and the regulator worked very constructively together, and we found a way to bring the mine back into operations for business continuity, and the ramp-up has progressed well to normal operations there. That's the way in which we've taken that into the guidance. Likewise, with the severe weather, with the cyclone that came through Curragh at the beginning of the year, we've considered that as well in our guidance consideration.
Guidance reflects the operating performance of the business, as I think was just demonstrated in the last probably 7 months of last year, of, you know, 1 million a month reliably out of Curragh. Buchanan's ramp-up really in that December month showed what that system can do. It considers that, and then it also considers the impact of those two events and then the volumes that we've taken out. Now, remember, Logan has run for the 1st quarter of this year. We've issued WARN, so that production is in the guidance, and we've got contracts that we have to meet obligations on. That, that is in the forecast as well. It's got all of those factors considered.
Yep. Awesome. Thank you. Just on, maybe a quick comment on, I guess, phase 2 and 3. So appreciate the details in, in, I guess, the pipeline, or, or projects that you've got, between Mammoth, Buchanan, and, and, Curragh. Just, I guess, on, on the phase 2 and 3 specifically? How should we be thinking about, I, I guess, Curragh as a complex? you know, you're obviously bringing in, you know, phase 2 appears like, you know, with the degassing, at the moment, you know, appears like that's kind of, you know, it hasn't been waterproof yet, but appears like that's probably likely to happen.
Do, do we think about Curragh as a complex, as kind of decreasing, you know, open pit volumes, and that's kind of being offset by you bringing in these Phase Two and Three Mammoth kind of expansions? Or I, I, I guess, how do, how do we think about the open pit volumes kind of being offset by those underground tons coming into the profile?
In, in very broad strokes, you've, you've defined it correctly. If you think of the life of the Curragh complex over the next 15-20 years, we've now spent the money and the effort to set it up again to be a productive dragline operation. It's got four draglines. We've invested in the strike length and the pit geometry that now draglines move 50% of the waste, and that will continue on, particularly in the northern mine, where those would run long term as highly productive dragline mines, so a large volume will come out of that. As the stripping ratio gets deeper, as all the Bowen Basin, building the capability to be an underground miner and a successful underground miner, as we've leveraged out of the U.S., positions the business well to exploit the resource.
With Mammoth Phase 1 getting approved, we actually got Phase Two and actually Phase Three of that project approved. That extends the life of Curragh. Underground, Watermark will be part of the long-term future of the operations. It averages down the cost, and it takes care of some of the stripping ratios it disadvantages that, you know, the older mines in the Bowen Basin start facing. That really sets us up well. We did take a BFS to the board in December. That was approved, but obviously, we'll only build that mine when it makes sense in the rest of the context of Curragh and also of the market.
As Barrie described quite carefully, our near-term focus is to de-leverage with the cash generation we see in the near term, and then we'll make the right decisions with board guidance on what we do. Mammoth Phase Two will, will be the near-term focus, and then Mammoth Phase Three. There's a twinkle in my eye with the research the team has done. There's potentially another underground mine in the south, but that'll be much further down the line. Forming a large portion. To be precise in answering your question, over time, the open cuts will play an integral base to the operations, but the undergrounds will provide you great flexibility and will start augmenting and replacing open cut, higher costs.
The business will pivot this year from, particularly now that we've reset the Stanwell arrangements, to focus on margin instead of incremental tonnes. We've got a great opportunity now at Curragh to drive for margin tonnes in the mining engineering and the way the business gets set up, which will provide a lot more flexibility in market cycles.
Yeah, thank you. Just a quick, quick follow-up, and you kind of touched on it, and I'll just, I'll hand it over after. But on thinking about the Phase Two approval, how do you think about gating that against your liquidity constraints and covenants with Stanwell? Like, are they gonna be a supportive backer if you are, if I miss... 'Cause you're, you're gonna have that CapEx in, calendar year 20, end of 2026, calendar year 2027. What's the liquidity profile for that to support a $150 million investment into that expansion, and how do you judge that against the Stanwell's kind of conditionality?
Well, Barrie, you go.
Daniel, I think that's where we, we tried to give a bit of color on that with that capital allocation framework at the back, which, I mean, it, it's a bit conceptual, but I think it aligns well with Stanwell's call it thinking on the business too. When, when we put together this, this reset transaction with Stanwell, that, that $300 million liquidity or cash at bank level was defined as, as, as a place where they feel fairly comfortable. With our sustainability, we feel fairly comfortable, and that kind of anything above that then triggers us actually repaying them whatever they've prepaid to us. That's a bit of a watermark in terms of liquidity.
As we say in that framework, I think when you get to total liquidity of, of adequate tenure, so it can't just be kind of short-term liquidity, that gets to like a $400 million level with a good outlook for the business. I think there'd be a comfort level to allocate capital towards something like this. Alternatively, the other option would be to, to try and find financing for something like Mammoth 2 on its, on its own strength and see whether you can actually finance that separately, as a project, if possible. That's, that's kind of the things we consider when we look at that investment and the timing of the board approving it.
Yep. Awesome. Thanks, guys. I'll hand it over. Thanks.
Cool.
Your next question comes from Glyn Lawcock, from Barrenjoey. Glyn, please go ahead.
Douglas, Barrie, good morning. Just wanted to try and understand, Barrie, your comments. I think you said cash is still the same yesterday as it was at 31 December, which is great. Does that incorporate, have you had any prepayments from Stanwell so far this year then? Because you're on about a one-quarter lag, so I'm just wondering if you didn't have the Stanwell prepayments, could you still be cash flow positive this quarter?
Yeah, yeah, absolutely. I mean, so we've had a small bit of concessional support from Stanwell, but it's single-digit millions because it was only for January, Glyn, then obviously didn't have the rebate for Jan. As I call it, all up, Stanwell support year to date is probably $15 million. Even without that, we, we would've been in fairly good shape as we sit now.
Okay, cool. That prepayment of $100 million, though, on slide 13, that, that is the prepayment that you think you would get if you, if your cash stays below the $200 million mark. Is that, that's what the $100 million is? You may not actually get the $100 million if you generate the cash and you move back up through $200 million, then you don't get any more. Is that right?
Correct. Yeah, that's the $170. When you look at that graph, $170 is the maximum prepayment if our liquidity stays below $200 million, and then the $100 million is the rebate forgiveness, Glyn. Your understanding is correct. If we stay below $200, then we can earn a $170 prepayment during the year. That happens, tests every month, the cash balance.
Yeah, given your step up in cash, once the price comes through in the second quarter, you should be able to maintain well above the $200, I would have thought.
Correct. Correct, yeah.
Yeah.
Between $200 and $250, you get half of that prepayment, and then kind of above $250, you get nothing. Above $300 million cash, you start repaying it. That's the beauty of the arrangement. It kind of as you can afford it, you repay it, but as you need the cash, you get it.
Yeah. Okay. A small amount of cash burn, but as you say, you've only got AUD 15 million in from Stanwell, so that's about it for, for the quarter so far.
Mm.
Just an update, an update on Logan. It looks like you will have made a decision already that it's not it's not in your guidance other than 500,000 tons. Is that correct, or, and, and is there still a chance that you could get pricing that sees it stay open, or is it almost your expectations are fair to complete that it does shut?
No, Glyn, the framework in the U.S. requires that you provide WARN when you've made a decision, which we have done, which gives our work for 60 days, that we work through with them. In that period, we'll be mining sufficient to honor our current contracted obligations. Some of it carry over from 25 pricing mechanism. We are working on alternate sales and looking for options. At this stage, we wanted to make the market aware of it. This is where we're up to, and then, if opportunities do present themselves, we'll clearly exploit it. You know, you know it better than most, I read your stuff, but you've seen the U.S. market structurally change. It's now forecasting a 4% reduction this year and potentially another 4% next year, but particularly around tariffs.
We've seen product that traditionally formed some of those very large long walls that have spent a lot of capital in recent years go offshore. Large volumes have pivoted back onshore and crowded out the market for that, that high vol A and B type product. Our decision-making with the board is strategically to ensure that the business is set up for high quality margin and liquidity. If the opportunity presents, we will, we will find the right, the right place to position it. The way in which we're working through the idle, just to be precise in my answer, is to create that flexibility. You know, across the four underground mines, there is opportunity that we could keep some of them going and service local contracts, we're not considering that at the moment.
Okay. The guidance at the moment only has 500,000 tons in for Logan, pretty much?
Yeah, roundabout. A little bit less than that.
Bit less. Okay, then just a final one, maybe, Barrie, just, obviously, CapEx sticks down to that $150-$175. In the absence of any growth spend like Mammoth 2, is that now the steady state for the business in, as running just a Buchanan, Curragh mindset?
Yeah, I think for, for the, the new installed capacity, Glyn, you'd, you'd look at that around 150 million level. It can be up and down a bit, year-on-year, but I think if you go with 150, you're pretty safe.
All right. Thanks very much.
Your next question comes from Rob Stein, from Macquarie. Rob, please go ahead.
Hi, Douglas and Barrie. Just on that slide 13, just looking at, you know, the business obviously looks set for a bit of an inflection point at 2020 and just noting, yeah, the management changes. Is this to signal, I guess, a change that we've been through quite a tough period, and now we're setting up the business to a new perspective, new growth perspective? Cost out's obviously been a focus, but if I look at the projects on offer, it looks like there is a bit of a future there for the business. Can you sort of talk about, I guess, the management change out in that context?
Look, the, the, I'll be the first to say, and I want to say this clearly, as I've signaled, that I, I'm moving on to, to other opportunities. This business has got a great future. You don't find many resources like Curragh and Buchanan, where you're fully permitted long life. You've put the capital in, and now you can draw great return on it. The, the infrastructure built at both these mines by previous owners and then what we've built upon, sets them up for long-term great life, and you can't be hindered. You know, you don't have to go and get a third party's approval to do anything over a long term, which is great when you've got an Indian market that has been buying both products for 40 years and is constantly asking us for more.
Every time I speak about Mammoth 2, we have off-take clients wanting to know how they can secure that. The business has been through a difficult period. You know, the original strategy was buy the right assets, loosely hold them. We went on a strategy of investing in the business and setting it up for the future that the board supported over the last couple of years. In some ways, fixing the ills of the past. You know, where you've got 4 draglines at Curragh, but the mine was totally boxed in by cell mining and made those highly unproductive. You know, draglines are only moving 37% of the waste, at a low point when we bought the assets. It needed investment and a technical fix, which the, which has been done.
The slide clearly demonstrate that, yes, we have historically peered over the fence and bought assets at the right time, and I think that may come back into the strategy. At the near term, it's to show that what we have, we can make a lot more of, and we've demonstrated the discipline in the business of on time, on budget, well thought through, well-engineered projects and low capital and very quick payback. That beats any multiple we can look at, at buying other assets at the moment. People who are invested in this business can really go on a good journey with what's already there and the team can make more of. The management change, first, talking to Jeff. You know, Jeff has had a fantastic career of 50-odd years. He's built other people's careers.
I joke about it, so does Jeff, our founder, saying, "Jeff knows where resources are that other people want to still discover, with the knowledge he has." It's time for him to transition into retirement, and he's flagged that. We're respecting that and enabling him. He won't be leaving straight away. It'll be a smooth transition into retirement, so that's very healthy and good for him and his, his family. For me personally, I joined the business four years ago as Chief Operating Officer because I could see the potential in the business, and I was fortunate enough that the board offered me the role of CEO.
I put a plan in place with the team that could drive productivity and drive the cost down and get the ever-spiraling costs in the business that were just going up to get down, and we, we won the confidence to show that we had a way to get the cost down at the second cost quartile. It wouldn't be driven by cutting the bones of the business away. It'll be actually investing in the business and driving productivity, and we invested in productivity initiatives. I'm very proud, particularly last year under the team, under trying circumstances, kept on focusing on that plan and have delivered that plan, and that same team stays in this business and will carry the business forward. Leadership change is natural.
People add to things, and then it's time for them to step out of the way and let other people take it forward, and that's that personal timing for me now. I feel like I've done the job. I made commitments to the board. Those commitments have been honored by me, by the team, and now I want to allow somebody else to take it forward into the next journey of the business. That core business that delivered this plan are the same people that can take the business going forward. The leadership change should have minimal impact on that at all.
Thanks, Douglas. That's good context 'cause it does, it does appear that, you know, you've been through the, through the trough, and it's now looking to come out the other side, and you're, you're not gonna enjoy the fruits of the labor. Thank you for, thank you for providing that, that context. In terms of, I guess, the capital intensity of that plan on page seven... Oh, sorry, slide seven of the presentation. The growth CapEx is pretty well outlined. The life extension CapEx, is that included in the sort of 150 rate that, Glyn asked about before?
No, it's not. The focus for 2026 really is sustaining capital. There's a little bit in there for degas, for Mammoth 2, and the like, some study work, but very little of it. It's sustaining capital. Our focus this year, we've agreed, with the board and the team, is, you know, we've just finished the Curragh major shutdown. That went very successfully. That's gonna enable additional throughput hours and yield out of that plant, so the step-up is now enabled in that plant. The focus in the near term is gonna be cash generation, a deleveraging, and then when the market's right, we will look at then investing in the business again through Mammoth 2 and the Buchanan plant expansion.
Sorry, maybe, maybe I misasked the question, if I think about Curragh extension, Mammoth Phase Three, Curragh extension to Curragh extension 3, they're life extension projects, which normally would be in a sort of a sustaining footprint. Given the, the sort of $150 million rate per annum quoted before, can we expect the $150 to include those life extension projects, or is that incremental CapEx that we're gonna have to forecast, you know, across sort of 2028, 2029, 2030 for those projects going forward?
Some of it'll be incremental additional capital, that you'll have to forecast. For example, you know, if you're gonna be building Mammoths, that's buying additional fleet. We'll buy two more continuous miners when that one comes online, another fan, develop the drives of the portals. In further life expenditures, when we talk about some of the pit, open pit extensions, there'll be some box cut work that will not sit in that sustained capital definition. At the right time, when those projects get green-lighted, we'll give more color on them.
Thank you very much, and, congratulations. Thank you.
Your next question comes from Nathan Martin, from The Benchmark Company. Nathan, please go ahead.
Yeah, thanks, operator. Douglas, I know you're gonna be around to support a transition, but I, I wanna take the opportunity to wish you the best of luck in your future endeavors. You guys talked previously about the recent wet weather in Queensland. How should we think about the impact from the severe cold and the snow and ice in the U.S. on first quarter operations, and all of these weather headwinds considered in full year guidance?
Nathan, thank you. The team over time have been very experienced, unfortunately, in Queensland, the last four years, maybe five years, with unpredictable weather and our cyclical and seasonal weather pattern planning. We do take the 10-year weather average, and then we break it down into a five-and-a-four-year pattern, and then we build in seasonal impacts in weather in the U.S. and in Australia. It's been more impactful in Australia in the last couple of years with some of the significant events that have come through, like, you know, the cyclone at the beginning of the year. You just don't plan for those, but you take them over an average. There might be a short-term impact, but then over time, your system can cope with it.
To the team's credit, they managed the impact of the cyclone incredibly well at Curragh, and very shortly thereafter, we were back up into, in operations and running. I think like anybody in the Bowen Basin, there's a lot of water in pit at the moment because releases of site are fairly restricted. The team are managing that, but we've got input dams, output dams, and pumping systems to manage. We're all watching the weather system that is up north in Queensland, the low pressure that's moving across the country pretty closely at the moment. I think that would potentially have impact if as much rain falls in the Bowen Basin as forecasted, with everybody having large volumes of water to, to manage and already have been pretty saturated. The system is equipped and pretty mature for that.
The freeze in the U.S. at the moment, you know, our operations in the Appalachians are underground. They're very experienced with that. We've had no significant impacts with the freeze this year to date in our operations, except for logistics. Rail providers have offered short-term force majeure where they've had coal freeze in carriages. Quite a few of the ports that get used on that side of the country don't have at-port offload points, so the coal comes into port in carriage and then gets directly offloaded in a coal loader into ship. Some of the coal is frozen in carriage on way, and to protect the coal loaders, they have stopped loading it. There's been a backlog at port that's flowing back into the operations.
That is now behind us, so that a short-term impact, and coal is flowing back out again, out of West Virginia.
Appreciate that color, Douglas. Then, and maybe just, you know, taking a step back and relate it, how should we think about the cadence of shipments as the year progresses? Obviously, we just touched on the weather, but also, you know, with the contracts, remaining contracts at Logan expected to be filled, when will those wrap up? Just trying to get a, a sense of the cadence of shipments. Thank you.
Logan is some carryover contract and pricing from 25. We will honor those probably through the first 6 months of the year. Most of those clients want that product all delivered in that period of time. There's some that goes into Canada that might trickle on through later into the year, but predominantly, that'll be closed out in the first 6 months. The rest of it has got some seasonality in what happens with wet weather and boats being able to come off anchor and go into port into Queensland. There has been a bit of a backlog going into port post-cyclone, but most of that generally gets worked through pretty quickly.
You'll see probably quarter two, quarter three out of Queensland, there'll be a spike in shipments, and then into quarter four, preparing for the wet weather season, that shipments will come off again. That's generally how the pattern happens. Our clients are asking for a very similar profile this year to what we've seen in the past.
Okay, great. Thank you. Just maybe one final, you know, your full year, excuse me, your full year mining cash cost per tonne guidance, the $88-$96 a tonne, what PLV price range are you guys assuming there?
Just, just to clarify that, Nathan, you say... So that's the cost guidance. How does the, the PLV relate to the cost guidance?
Are there any variable costs, Barrie, tied to that range? Obviously, the, the Queensland royalties, I guess, hit up at the top.
Okay. Okay.
Just curious, so.
That's mining cash cost, so the royalties actually fall outside of that. The pricing wouldn't have a bearing on the cost behavior, Nathan. It's just mine cash cost that we've got in that number.
Okay, got it. It kind of answered my question. Maybe just, you know, to the extent you can break it out, Barrie, I mean, what kind of mining cash cost per tonne assumptions are you guys incorporating for Curragh versus, you know, the U.S. business to get to that range?
Yeah, I mean, when you look at that, at that cash cost, there's a couple of moving parts that you have to consider in there. There's FX, as I highlighted in the conversation in Australia, is important. You know, we had kind of a 64 cent FX rate in FY 2025. If you look at where the Australian dollar is trading currently, it's about 71 cents, there's something to consider there. And we've considered about a 68 cent average for the year, FX will play into it. Then last year, we were still ramping up the Mammoth Project, there was some pre-production costs that we capitalized that won't recur. That kind of comes into the cost equation.
As I said when I spoke about cash as well, we do need to put a bit of money back into Curragh and Buchanan for development. That's gone in. That's kind of a $50 million number across the two complexes. A big slice of cost that comes out is Logan. We've assumed, as Douglas said earlier in our guidance, that Logan will be there for kind of Q1, maybe a bit longer. You need to take the Logan ops cost out of it and then add a bit of variable cost for the volume. That's kind of the moving parts when you look at it on a year, a year-on-year basis. Those are the things that kind of drive it.
As, as is usual, as I said in the first part of the presentation, we are running hard at managing cost across the business, but especially at Curragh. We've done a lot of work with the commercial team. We're recontracting some of that, and we'd, we'd expect the, the work we're doing on savings and improving commercial discipline to offset some of the inflationary pressures that we're seeing. Without kind of putting specific numbers to that, when you bridge the cost from 2025 to 2026, those are the big moving parts that you need to kind of traverse to get from 2025 to then that $88-$96 that we're guiding.
Got it. Very helpful. appreciate the time, gentlemen. Best of luck in 2026.
Thank you.
Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. The next question is from Fintan Collins from UBS. Fintan, please go ahead.
Thank you. Just a quick question on Logan. How do we think about its position on the portfolio going forward? Do we think it could attract strategic value from a U.S. operator with greater economies of scale? In such a case, would the board consider the monetization of the asset to de-accelerate deleveraging, conversations being had in this respect? Thank you, and I'll follow up with the second.
All, all of the points you raised above are on the table at the moment and will be taken to the board in due course for consideration. At the moment, the focus was on, you know, where's the market at? What can we mine to honor our contracts? Let's do the right thing by our people and inform them of the decision-making and fortunate that the market has brought us to. We are exploring, all the options above, but no decisions have been made at this stage.
Okay. Thank you. Just on those leadership changes, could you provide a bit more context around the decision and timing? How should we think about strategic continuity, and what's the current timeline for recruiting a new CEO? Thank you.
Strategic continuity is the plan that we've delivered to the board, and this management team is a very tight team. It's a, it's a plan that's collectively owned. The fact that Jeff and I are stepping away from the business shouldn't impact the, the strategic direction of the business at all and the, what we've laid out at this stage. The, the other help in it that we've tried to flag as well is, at the moment, there is no conflict. With the style of business we are and the way in which I like to operate is, if a conflict does arise, particularly focusing on myself, now I'll make the board aware of that straight away, and then the board will decide if, if they need me to step out of the way.
To catch that, we've got our founder, Chairman Gerry, who is obviously across everything in the business, who can step in at very short notice if required and keep continuity going. Likewise, the management team are rock solid and will keep continuity going if, if that eventuates. Stability while we're going through this transition is key to us, and ideally, I'm around, and I'll see it through. Recruiting, we've-- we always focus on succession planning and development within the business, and then externally as well. We haven't found ourselves flat-footed in this regard as well, but that needs to run a due process and be done well. Those things don't take 5 minutes, but they don't take a lot of time either. You can work through them very efficiently.
I'd say, fortunately, this is quite attractive role, so we, we should, we should be able to come back in due course and give everybody comfort that we've got the right people leading the business going forward.
Okay. Thank you. That's very clear. I'll pass it on.
That concludes the question and answer section of today's call. I'll now hand back to Douglas for closing remarks.
I'd just like to say thank you to everybody for joining the call today. Hopefully, you can see that over time, we've had a plan. This is a business that has been very disciplined, engineering-led, and executed a plan with steely focus on getting long-term outcomes. Those long-term outcomes, the fruit is starting to show itself within the business, and there's clearly immense upside within the resources, but then also the people within the business. Thank you. Then, if you do have any further questions, Chantelle is generally far more eloquent than Barrie and I in answering your questions. Please turn to her, and she'll help you with any further questions you do have, and the rest of her team. Thank you.