Deputy Prime Minister and Minister for Transport Mark Vaile yesterday announced a $3.5 million government commitment to consider the economic and financial viability of dual gauging the proposed Surat Basin Railway line to increase its capacity.
NEC managing director Keith Barker says the decision is a further boost for the company’s Elimatta coal project at Wandoan in southern Queensland.
“This is another step forward for the railway project which will open up the Surat Basin, with a 207km rail line from Wandoan to Banana allowing access to the Port of Gladstone,” he said.
Barker said a new open-access dual or standard gauge railway should offer greatly increased capacity and efficiency when compared with the existing rail network servicing the central Queensland coal fields.
“Access to such rail infrastructure is vital for the development of our Elimatta project,” he said.
“This link should provide all companies, which are developing coal deposits across the Surat Basin, with the capacity they require to service growing export markets.”
A dual gauge line would be able to handle large standard gauge coal wagons as well as the smaller narrow gauge equipment used by Queensland Rail and is expected to result in lower coal freight rates.
Barker said the prospect of the major rail project going ahead was further enhanced by Xstrata’s recent approval of a pre-feasibility study into developing its Wandoan project, which would be the largest coal mine in Australia.
The coal resource at NEC’s Elimatta project has recently been increased by 70% to 222 million tonnes, comprising 200Mt of inferred resource and 22Mt of indicated resource.
Barker said there was also potential for an extension to this resource with new drilling presently underway.
Elimatta coal is low in sulfur and high in hydrogen and “volatiles”, making it particularly attractive for power generation.
“The thermal coal from the Surat Basin is among the best in the world for gasification, making it well-suited for carbon-capture power stations,” Barker said.
“These are the power stations which miners and generators intend to develop using integrated gasification combined cycle and other low emissions technology to maintain coal’s pre-eminent position as the low cost fuel for global electricity generation.”
