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Nirvana beckons? « Previous | |Next »
November 26, 2013

I watched the ABC's Four Corners programme by Marianne Wilkinson on Clive Palmer last night. It was basically about the politics of coal in Queensland, Australia's new coal state.

Palmer was shafted by Newman's LNP with respect to his development of the Galilee Basin. Gina Reinhart's development --- the Alpha Coal Project constructed by Hancock Coal and GVK -- was favoured, with respect to being granted permission to develop the mine, and to build the railway to, and the port facility at, Abbott Point. So he built the Palmer United Party to attack the LNP so that he could get his Galilee Basin Waratah Coal development off the ground.

RoweDPalmer.jpg

What surprised me about the programme was the complete lack of economic analysis. The assumption was boom boom boom --- an unshakeable belief that coal can provide the only solution to the rampant energy needs of India and China--- two of the world’s two fastest growing energy markets--- and that Australian coal could be developed on an economically viable basis to sell to China and India. Nirvana beckons and the Queensland government buys the industry view that coal export growth momentum will continue.

This boom boom view was that of five years ago. Today the economics of coal is much, much risker: the international coal market is in the doldrums, the major, established mining such as Xstrata and BHP, scaling back their coal developments, new supply from cheaper overseas competitors, having long-term implications for the value of Australian assets, the investment banks being rather worried about high-cost mines becoming stranded assets in the next decade and the high risk of Queensland coal being priced out of the market.

No matter. What’s good for Queensland is good for Australia and demand from India will help reverse the recent downturn in coal exports. The Newman Government says they will build the port infrastructure if it is uneconomic for private global capital to do so. They are the coal state governed by climate deniers where the coal industry wields considerable influence in state politics.

| Posted by Gary Sauer-Thompson at 12:34 PM | | Comments (2)
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http://www.abc.net.au/news/2013-11-04/bhp-billiton-axes-abbot-point-rail-plan/5067338

"BHP Billiton has scrapped plans for rail and port development in north Queensland....The decision follows a Centre for Policy Development report that found existing coal terminals are underused and further port expansions could be unviable.

It says Queensland's coal ports are currently operating around 65 per cent capacity."


Incredible.

Campbell Newman's agenda is to have control of any kind of mining in Qld with environmental controls and little oversight by the federal government.