Did the Abbott government set up a secret $5bn Galilee Basin coal slush fund?
You heard it right!
One of the iMINCO editors was contacted by a subscriber to the Project News service and told us about this recent clash between two politicians in the House. The subject matter eluded to the government setting aside a huge amount of taxpayer funds to finance the development of the proposed Galilee Basin coal mines.
Now, unless you’ve been asleep in a cave for a couple of years, you’ll be well aware of the plight of the Australian coal industry as global markets slacken off, leaving many mining companies in Australia looking at their shoes and muttering to themselves about what to do next.
Traditional coal regions like the NSW Hunter Valley and Queensland’s Bowen Basin have maxed out in terms of expansions because the current coal mines are frantically doing the best they can to keep the doors open. Productivity in these coal mines has increased dramatically over past 12 months with mining efficiencies creating a bit of a jobs vortex.
There’s still plenty of workers running these high volume coal mines, robots have not taken over the accommodation and mess halls just yet. Take a look on the popular online jobs boards like SEEK and Indeed and you’ll see plenty of jobs for skilled and experienced people. You’ll not find too many jobs where a waiter can walk into a $150,000 mining job as was the case 3 years back – on no!, that’s all changed now.
So, moving on (and there is a point to all of this!)…if the present coal mining sector has seemed to bottom out – what’s next.
Galilee Basin.. that’s what’s next
Again, if you know about the Galilee Basin, the size of it and what lies close to the surface, and if you are a skilled worker looking for a new era of secure mining employment in Queensland, then you’ll be setting your sights on this proposed development.
A few mining companies are vying for position to be the first ones to get the coal out of the ground, which sits under prime Western Queensland farming land. Rife with controversy and objections from green groups and farmers alike, this huge coal mining development could be just the panacea Queensland needs to lift it out of the coal mining doldrums.
Let’s look at the facts.
As of May 2015, there is one international company that has gotten the green light from the Australian federal government and the Queensland state government to go ahead and start building the mine infrastructure. That company is Indian based Adani Enterprises. They want the coal to help lift millions of Indian citizens out of the dark ages (literally) and allow them access to electricity.
It’s the intention of the Adani project for Indian power stations to be fuelled by Australian coal from the Galilee Basin. Adani’s proposed mine is called Carmichael and sits a few hundred kilometres inland from Mackay. Owing to the location of the mine and the vast distance from the existing coal loading port of Abbot Point (of which Adani has invested some AUD$2 billion on infrastructure), a massive rail link needs to be built.
Despite Adani fighting continual battles to get bank finance for the proposed mine and environmental activists stopping progress, contracts have been awarded to Korean company POSCO, to build the rail link and Downer EDI are the nominated contractors who will build and operate the mine.
Debate still rages passionately up and down the corridors of government as well in the small towns adjoining the proposed Carmichael coal mine development, whether the mine will be built or not. More often than not, the frequency of negative media about the development gets its fair share of prime media slots, creating a wave of sentiment geared towards the mine failing to get off the ground.
If you watch this video of Senator Larissa Waters, of the Greens, probing the Minister for finance Senator Mathias Cormann about the Northern Australia Infrastructure Facility announced in the budget about taxpayer money being used to fund infrastructure that would greatly benefit the Galilee Basin mines.
Senator Waters made reference to the suggested impacts on the environment the mine could create and the fact that 11 international banks has put the ‘kibosh’ of lending Adani the money to develop its Carmichael Mine.
In a classic political sidestep, Senator Cormann did a great job of rephrasing the question and deflecting the intent of Senator Waters; only to pitch the government’s intent on developing the state road and rail infrastructure to enhance economic development and with it more jobs.
Cormann was agile and confident as he strutted and talked up the contribution coal makes to the Queensland and national economy, but again was non-committal as to how the $5 billion of funds would be used. (it’s classically entertaining to watch).
Again Senator Waters asked the question “would government money be used to finance Galilee Basin coal mine development?”.
Cormann again, did a marvellous job of deflecting the question, and made no assertion that the funds would be used, only to say that every project would be looked at on its significant contribution to the development of Queensland.
And… this is the good bit.
He gave the answer to the question, “would government money be used to finance Galilee Basin coal mine development?“, “No I won’t rule it out”.
“No I won’t rule it out”.
Senator Waters again questioned Cormann on whether the Queensland government had set up a ‘slush fund for the coal industry’.
“I believe coal is good”, said Gormann.
“I believe coal can lift people around the world out of poverty”, and BOOM, there it is!
If you have been following the development of Adani’s proposed Carmichael mine development, you would have heard that comment before, many times from the Adani camp.
Mr Adani himself, the self-made billionaire Gautam, has himself said it is his dream and that of his country to life his people out of poverty by giving them access to electricity.
So it seems, the QLD government and Adani are on the same page in terms of where this project is heading and they have the money to help nudge it along the way. If we also remember, recently ousted QLD Premier Campbell Newman had pledged 300 million of taxpayers’ money to assist kick0-starting Adani’s Carmichael mine development.
Then the new Premier Annastacia Palaszczuk announced there would be no mining projects funded by Queenslanders.
In a typical debate reminiscent of a school yard game of cat and mouse, this recent exchange of words between the government and the opposition has some underlying clues as to the government’s stance on supporting development of the Galilee Basin mines.
This is a must-watch video, it’s entertaining and informative, even though one of the pollies behind Senator Cormann was clearly seen nodding off… taxpayers money well spent once again!
Learn more about the Bowen Basin mining location.
The Bowen Basin contains the largest coal reserves in Australia. This major coal producing region contains one of the world’s largest deposits of bituminous coal.
The Basin contains much of the known Permian coal resources in Queensland including virtually all of the known mineable prime coking coal. It was named for the Bowen River, itself named after Queensland’s first Governor, Sir George Bowen.
The Bowen Basin covers an area of over 60,000 square kilometres in Central Queensland running from Collinsville to Theodore and is dotted with many coal mines operated by multiple mining companies.