2010 Media Releases

Deutsche Bank has initiated coverage of Whitehaven Coal Limited (ASX: WHC) with a Buy rating.

Research Analyst Brendan Fitzpatrick said “Whitehaven Coal operates several open coal mines in NSW’s Gunnedah Basin and is now developing a 6 million tonnes per annum (Mtpa) Longwall project at Narrabri. Deutsche Bank has a positive view of the company’s ability to deliver the Narrabri project, albeit delayed, which will enable the production rate to be lifted.”

Whitehaven exports 100% of its coal. Rail capacity over the coming years appears to be sufficient to meet Whitehaven’s needs as a result of Whitehaven and Idemitsu sponsoring upgrades of the rail capacity. However port allocations in Deutsche’s view, is a limiting factor for the company.

Fitzpatrick said “On current year metrics, Whitehaven is at a premium to peers but we see its increasing production and export leverage as the reason for this. The high yield achieved from the Gunnedah Basin mines, and our expectation that prices will remain elevated, provide further support to the investment case for coal mining projects in the Gunnedah Basin”.

Deutsche Bank also believes that Whitehaven may consider further acquisitions or mergers if they are determined to be appropriate. An example of this is the company’s recent purchase of the Vickery deposit for AUD31.5m.

Whitehaven Coal Limited operates several mines in the Gunnedah Basin, about 450km north-west of Newcastle. Whitehaven produces Pulverized Coal Injection (PCI) and thermal coal for the export markets.

For further information, please contact:

Amy King +61 (02) 8258 2505