Published in the February 2010 Australia’s Mining Monthly

The Minerals Council of Australia’s sister organisation, the Queensland Resources Council, has estimated that $A4.5-8 billion worth of coal production has been lost as a result of the floodwaters and La Nina inspired wet weather.

The QRC estimates production for the March quarter will decline by 25-50%. This will reduce Queensland’s Gross State Product for 2010-11 by at least $4.5 billion, and $8 billion in the worst-case scenario.

Queensland’s GSP had been growing around $5.6 billion a year, so even being optimistic the floods could wipe out almost a whole year of economic growth. This will have flow-on consequences for all Australians. The sunshine state makes up about 20% of our economy and produces 15 million tonnes of coking or steelmaking coal. Of Australia’s coking coal exports, 90% originate in Queensland.

A survey of Queensland coal producers has established that 45 of the state’s 57 coal mines were affected to some degree by flooding. This includes 15 open-cut pits that have been turned into vast waterholes.

The industry will need to spend millions of dollars to clear the water, replace damaged equipment and fix export infrastructure in order to get back to full production.

About 130,000 Queenslanders are employed directly and indirectly in the coal industry. Many of those employees have spent the summer battling the floods, protecting their homes or working with family, friends and neighbours to hold back the rising waters. Some have lost loved ones.

And they have not only given their time – they have also donated millions to the Premier’s Flood appeal.

The companies that employ them have also been generous. BHP Billiton has so far donated $11 million to the premier’s flood appeal and Rio Tinto and Xstrata have contributed more than $4 million.

However, before the floodwaters could clear, the workers and companies caught up in the crisis were accused of causing the disaster.

The leader of the Australian Greens party, Senator Bob Brown, issued a media statement at the height of Queensland’s crisis describing the industry as “the culprits” of the floods. He demanded that the coal industry pay for the clean-up.

“It is unfair that the cost is put on all taxpayers, not the culprits,” Brown said.

“Burning coal is a major cause of global warming. This industry, which is 75 per cent owned outside Australia, should help pay the cost of the predicted more severe and more frequent floods, droughts and bushfires in coming decades. As well, 700,000 seaside properties in Australia face rising sea levels.”

He said the industry’s “coal barons” should be hit with a 40% tax to pay for the flood damage. This was rank political opportunism at its ugliest. It also was economically ludicrous. Imposing a 40% tax on Queensland’s coal sector just as the industry is getting back on its feet would send it backwards.

Projects would be shelved and jobs lost across the state. This is exactly what Queensland does not need.

Brown’s remarks have spawned other similarly distasteful and ill-informed groups to embark on politically motivated campaigns. The Sydney University Climate Action Collective, the Green Left and the Yarra Climate Action Now groups have launched campaigns to make the industry pay and blame the sector for the floods.

“The floods are yet more evidence that we must quickly phase out fossil fuels and embrace 100 per cent renewable energy,” the Green Left said.

Like the Greens political party, these outfits are happily using the misfortune of the floods to drive a political agenda. They should be condemned not only for their shameless opportunism, but for their campaign of misinformation as well.

Queensland supplies 5% of the world supply of coal used for making steel not in power stations.

With the federal government planning to introduce measures to tackle climate change this year, we should expect much more of this misinformation and opportunism.