Cumnock Underground Operations Cease Following Ten Years Of Operations

Sydney, 26 September 2003

Cumnock underground mine today ceased operation following an announcement in January this year stating this decision as a result of adverse geological conditions.

Peter Coates, Chief Executive Xstrata Coal and Managing Director Cumnock Coal, said, “Xstrata Coal, Cumnock's major shareholder, acquired its initial interest in the Company back in 1995, some eight years ago. Since then, Xstrata has also provided significant financial support to Cumnock.

“Whilst it is very disappointing to see the underground mine close and employees lose their jobs, I am comforted by the fact that due to Xstrata Coal's financial support to date we have been able to extend the mine's life and ensure the continuity of operations and employment. Furthermore, as a result of this financial support, Cumnock Coal is able to meet all employee entitlements in full.”

“Following today, the next phase in Cumnock's history will be realised with the continuation of the open cut operations and the coal preparation plant.” Mr Coates said.

Lawrie Ireland, Operations Manager Cumnock Coal, said, “I would like to take this opportunity to recognise the contribution of all of Cumnock's employees, both past and present, over its 10 years of underground operation. I would also like to thank everyone for their support - not only during the last 12 months which has been a challenging time for all of us, but throughout the history of this mine.

“Everyone has worked very hard to ensure the wind-up of the underground mining operations has been completed in a timely and, most importantly, safe fashion.”

Ends

For further information:

Justine Winn

Corporate Affairs Manager

Xstrata CoalM: 0416 196403