Whitehaven Coal

Risks and opportunities (Table 1, page 68). Policy transition risk: increased exposure to carbon regulation and policy. Project approval transition risk: increased complexity in obtaining mine approvals or commencement of new projects. Market/technology transition risk: reduced demand for coal in our export markets. Access to capital transition risk: reduced availability of debt/equity and insurance. Physical climate-related risks: inundation, bushfire and water scarcity. Opportunity: increased thermal coal production, to deliver superior efficiency and lower emissions intensity than lower-quality coals in like-for-like power stations.

Time horizons (page 63). Short term is a one year forecast (2027); medium term is the forecasting cycle from 2028 to 2031; long term extends beyond the medium term to end of mine life, which can extend for 20 years or more (2032 to 2050+). These are broadly aligned with strategic planning and decision-making processes. Each risk and opportunity table (pages 69–74) carries a Relevant time horizon graphic showing short, medium and long.

Materiality (page 68). Climate-related risks and opportunities (CRROs) are assessed against financial, health and safety, environment, legal and compliance, and reputation and community consequence types, together with likelihood. Financial impact is assessed against revenue, earnings before interest, tax, depreciation and amortization, and/or Net Present Value.

Operations and value chain (page 57). Whitehaven operates two coal mines in Queensland and four in New South Wales (including one underground mine), in the Bowen Basin and the Gunnedah Basin, together with the Gunnedah Coal Handling Preparation Plant. The value chain spans development, operation, rehabilitation and closure of coal mining assets, upstream products and services such as diesel, explosives and tires, and the marketing, transportation and distribution of coal to the port. Products are sold on free-on-board terms.

Where climate-related risks and opportunities (CRROs) are concentrated (pages 67, 69). CRROs exist across the entire value chain, from upstream operations to mining, processing and transporting coal to the port. Physical climate-related risks are concentrated at sites in the Bowen Basin and the Gunnedah Basin. The Blackwater, Daunia, Narrabri and Maules Creek mines have obligations under the Safeguard Mechanism and represent 92% of Scope 1 emissions (page 69).

Effects (pages 69–74). Tables 2 to 7 set out the value chain impact and the impact to the business model of each risk and the opportunity, mostly across both upstream and downstream activities; project approvals mainly relate to upstream activities. For FY26 the report states no material impacts from project approvals, reduced demand and physical risks, no material adverse impacts from access to capital, and no material financial benefits from the opportunity (pages 70–74).

Transition plan (page 75). Whitehaven does not have a formal climate-related transition plan. It continues to assess and pursue site-based decarbonization opportunities with prospects for economic viability and technical feasibility. Pending further advancement, the focus is site-based initiatives to mitigate Scope 1 emissions and carbon credits to meet Safeguard Mechanism obligations. At present, available operational abatement technologies are not expected to deliver the required emissions reduction in a technically feasible and economically viable manner to meet those obligations.

Levers (pages 75–77). Table 8 lists levers, including goaf sealing at Narrabri and electrified dig units (both implemented) and a proposed 26 MW Narrabri Solar Farm (FY30–FY40, subject to final investment decision and Board approval). In New South Wales, 100% of Scope 2 emissions are offset through Climate Active-certified carbon-neutral electricity; from January 2026 it is 100% GreenPower renewable energy. About $5.6m contributed to Low Emission Technology Australia since 2020.

Decisions and capital (pages 60, 63, 91). Climate-related factors are incorporated into major acquisition and investment decisions (page 60). The April 2024 Daunia and Blackwater acquisition advanced the goal to grow in metallurgical coal, now 57% of FY26 revenue (page 63). FY26 capital invested toward mitigating climate-related risks was $21m, mainly water management infrastructure (page 91).

Quantified (pages 69, 72). Policy risk: FY25 Safeguard Mechanism liability of $7m on an equity basis; FY26 liability estimated at $9m (based on an ACCU price of $40); medium-term liability estimated at $24m to $40m per annum. Access to capital: the FY26 refinance reduced annual interest expense by $50m to $55m per annum, lowered cost of debt to 6.3% from 9.5% and increased average term to maturity to 5.8 years from 2.5 years.

Not quantified (pages 69–74). Long-term Safeguard Mechanism effects (uncertainty around legislative outcomes); project approvals (uncertainty; projects have not achieved final investment decision); reduced demand in the medium and long term (not separately identifiable from other price drivers; not expected to be material); long-term cost of capital (measurement uncertainty); physical risks (mitigation costs not separately identifiable; long-term impacts immaterial); the opportunity (climate-related benefits not separately identifiable).

Current effects and carrying values (pages 70, 83). FY26 capital expenditure of $47m related to the Vickery, Winchester South, Narrabri Stage 3 and Maules Creek Continuation projects; the portion attributable to climate-related drivers cannot be separately identified. The identified risks are not expected to result in a material adjustment to carrying values of assets and liabilities within the next annual reporting period (page 83).

Scenarios (pages 78–81). Lower warming (1.5°C above pre-industrial levels, transition risk): demand trajectories informed by a published International Energy Agency scenario (Net Zero Emissions); forecasts to 2050 by Commodity Insights. The scenario assumes seaborne metallurgical and thermal coal demand declines 90% by 2050, with floors of US$72/t (real) for metallurgical coal and US$46/t (real) for thermal coal. A $40/t carbon price applies to mines under the Safeguard Mechanism, 2026 to 2050. Higher warming (well exceeding 2°C, physical risk): IPCC SSP2-4.5, approximately 2.7°C by 2100, assessed for bushfire, inundation and water scarcity at twelve sites, rail corridors and ports, for 2026, 2035, 2050 and life of mine, with no future adaptation assumed.

Results (pages 80, 83). Under the 1.5°C scenario the operating mine portfolio remains resilient until the late 2030s but is not resilient from the late 2030s through to 2050 due to a structurally lower coal price environment, assuming no change to strategy or mitigation measures. Development projects would not be financially feasible. Physical risks are not considered material to the operating mine portfolio and supply chain in the short, medium and long term.

Responses (page 83). Options include optimizing the mine portfolio, changing mine plans or curtailing production, reducing capital expenditure, renegotiating take-or-pay charges and terminating projects below a requisite 15-25% post-tax IRR.