India's coal woes could create more Queensland mining jobs

India’s coal woes could create more Queensland mining jobs

India's coal woes could bring more Queensland mining jobs

There’s been a lot of press lately about how the price of thermal coal has dropped significantly and how this has caused a reduction in Queensland and NSW mining jobs.

Although this is true, there has been a levelling across the entire industry, and indications are, things could improve – if you choose to see a glass half full rather than half empty.

What we tend to read in the news is mainly the negative side of the mining industry because it creates a buzz for readers who thrive on this type of attention. On the other side of the tracks lies another perspective on the mining industry, where optimism and forward thinking drives a whole new era in Australian mining.

Most of the mining news that indirectly affects Australian mining companies is never found by the majority of people who are still looking for a way to get a start in the mining sector. The dreams and hopes of ordinary people can be squashed like a mining boot on an ant, when there is a consistent air of pessimism pervading the industry that is driven by the media.

So here’s an example of how to look on the positive side of Queensland mining jobs opportunities. We’re not saying this is the answer to mining jobs; we are simply bringing the facts to the table, allowing you, the reader to make your own assumptions.

India has one of the biggest coal problems in the world

A report this week confirmed that India is facing a crisis of supply with a number of coal fire power stations having less than a week’s supply of coal stocks on-hand. Given that India and its massive population relies on coal to generate electricity, it’s very concerning for the government and they are obliged to something about it.

This again has put the squeeze on Indian power companies who have an obligation to provide consistent energy supply to Indian industries and residential markets.

India has also been faced with massive problems of corruption in its mining industry, so much so that the Indian government intervened and cancelled some of the mining tenements and leases that were held by companies like Adani and GVK. GVK and Adani are Indian power and energy companies who have already made significant investment in the Queensland coal mining industry.

So why should we care about India?

When you look at the coal sector in India their challenge is really quite obvious. There is simply not enough coal to go around. What they do have is low quality coal, however, the mining technology and equipment in many Indian coal mines is old and requires intensive manual handling.

Recap on the issues facing Indian coal companies

We can see that Coal India, which is the main state-owned coal mining company, has always failed to meet it output targets despite sitting on the world’s fifth biggest coal reserves.

One of the other issues that India faces is actually transporting coal from internal coal mines to their power stations because of the lack of infrastructure and availability of railway lines. The country uses their railways for transporting much of the population, so adding new wagons and trains to the already overloaded system is really creating new issues that are difficult to solve.

Indian mining companies are also in a bit of a pickle. Coal supplies are low and other internal political problems prevent private mining companies from selling to the domestic market.

Corruption in the Indian government and mining companies is rife, so this again stifles the marketplace and makes it more difficult to supply coal to the power stations. It’s not uncommon for major Indian cities to experience power cuts on a daily basis and if you’ve ever been to India and the power has been cut, it’s a very uncomfortable experience.

The Indian government sees privatisation of the industry as a stepping stone to creating a more stable market – however this is something that won’t happen overnight.

Key managers missing from Indian coal companies

What makes things even worse for India and its coal business is that some of the top-level positions have been vacant for some time.  India itself has seven local mining firms operating underneath its umbrella and three of those don’t have full-time heads of departments. This is even more of a problem at a crucial time when the country itself is struggling to meet the fuel demands of it’s consumers.

Again this is highlighted in a recent report that stated the mining companies can’t quickly replenish critical supplies by digging out more coal. There are issues around environmental clearances from the government, lack of rail systems and coal logistics, plus Indian coal quality is low and not suited to some of the power stations which were originally designed to be fuelled by Australian high-quality thermal coal.

Queensland’s solution to India’s coal dilemma

Have you heard of the Galilee Basin? Who are Adani and GVK? Have you been to Kevin’s Corner, or even heard of Carmichael Mine?

Over the past couple of years, there has been a lot of talk of developing the Galilee Basin in Queensland. GVK is an Indian power and energy company that is planning on investing $14.2 billion in two large coal mines in the Galilee Basin ““ Alpha and Kevin`s Corner ““ plus an Abbot Point coal terminal at Bowen, and a proposed 500 kilometre rail line to link them.

The rich coal seams found across the Galilee Basin lie close to the surface, therefore extraction of the resource is much easier and therefore more cost-effective. One of the main issues with development of coal mining in the Galilee Basin is its geographic location – some 500 miles inland from the closest port of Abbot Point.

The Queensland government has never ‘chipped in’ cash to help mining companies develop the infrastructure to access the coal resource. Mining companies must rely on borrowed cash in order to lay the hundreds of kilometres of track. This expense is one of the biggest factors in developing the basin as one of the world’s largest coal mining areas.

However, Queensland Premier, Campbell Newman, has this week announced the proposed route of a long, narrow slither of central Queensland which will be known as a State Development Area. This is purely to assist mining companies (Adani and GVK-Hancock) to construct two rail lines from the Galilee Basin to Abbot Point, near Bowen.

The proposed rail corridor would allow the Galilee mega mines of Indian companies Adani and GVK to transport coal to the ship loading facilities on the East coast of Queensland.

What’s next for Queensland mining jobs?

The pace of development of the Galilee Basin is anyone’s guess. There are many factors at play and any one of them could be considered the ‘linchpin’ of the project. Environmental impact statements, negotiations with landowners and financing are all barriers to the development plan.

Will there be a meagmine built in Queensland’s Galilee Basin? No one can say for sure. What is certain is that iMINCO will continue to follow the progress of the project by way of iMINCO Project News. Subscribe to the weekly email newsletter and stay in touch with the development of the Galilee Basin project as well as other projects that could create thousands of Queensland mining jobs in the future.

Related stories and articles on Coal India, GVK, Adani and the Galilee Basin project.

Click on any of the links below to bring yourself up-to-speed on the project. There are some in-depth articles you must read if you are looking to develop a career in the mining industry on this or other projects. As we said before, no one can predict the future of the Galilee Basin – is your glass half full, or half empty?

Adani Galilee Basin mine gets Qld government support

Galilee Basin Mine Jobs ““ What are the facts?

GVK Galilee Basin Mining Update

Galilee Basin, Adani, Abbot Point, investment & mining jobs

iMINCO Project News Queensland

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