Newman woos coal chiefs with swift approvals

QUEENSLAND Premier Campbell Newman is seeking to win back investment dollars of coal mining companies which have condemned his royalties scheme by offering to cut project approval times and planning a salinity trading scheme for the Fitzroy River.
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Queensland premier Campbell Newman

Lou Caruana

The premier also recognised mining’s contribution to the state’s exports after major coal company heads, including Peabody Energy chairman Gregory Boyce and BHP Billiton chief executive officer Marius Kloppers, took the government to task over its increased royalty rates for coal.

It will be increasing mining royalties on coal by $1.6 billion over four years.

"The single most important thing I want sorted out is the federal-state approval process," Newman reportedly told the The Australian yesterday.

He says "there has to be one process" between federal and state approvals that would help ensure new projects take a maximum of two years to get the green light.

"That is my target," he said.

Last month a survey of the state’s coal chiefs found that all Queensland coal producers expected to cut costs and reduce employment at their mines in response to the increase in coal royalties announced in the state budget.

The Queensland Resources Council survey showed that cost-cutting measures would also include reducing contractor numbers, cutting rail and port costs and cuts to exploration expenditure.

This week Newman praised the contribution of mining and mining services to the economy when he awarded mining contractor Ausenco with the 2012 Premier of Queensland’s Export Award in the minerals and energy category, with Xstrata as a runner-up.

“Growing exports in this challenging global environment is no mean feat,” Newman said.

“These Queensland companies have achieved great success through innovation and determination to meet the changing needs of the global export market.

“I congratulate these companies on their success and thank them for the valuable contribution they have made to Queensland’s economy.”

The QRC yesterday welcomed the state government's proposal for the management of salinity arising from flood events affecting coal mines in the Fitzroy River catchment.

Deputy Premier Jeff Seeney said the government would investigate the feasibility of establishing a salinity trading scheme for the Fitzroy Basin.

An STS works by allocating participants discharge-release credits, which they use to calculate the percentage of the allowable discharge of saline water into the basin.

The credits can be traded among participants according to individual mine requirements.

“We need a solution that is firmly based on science, establishing for the first time a set of principles about how excess water from the coal mines is released into the river system,” Seeney said.

“We need to ensure that different industries can coexist and we can sustain economic development, while water quality is maintained at acceptable levels for the basin’s communities.

“Water quality needs to be as good or better than it is today.

“Never again do we want to see a repeat of the Ensham episode of 2008.

“With Central Queensland coal mines still coping with excess water from the recent flood years, we need a well-designed, considered management system that enables mines to deal with water issues on an ongoing basis.”

Seeney said the Hunter Valley in New South Wales, which has an STS, may provide a model for the future of the Fitzroy Basin.

QRC CEO Michael Roche said the Newman government was taking a scientific approach to the issue of water releases from mines during extraordinary weather events, such as that seen in the 2011 wet season.

“I'm very pleased to see that the government will set up a pilot release of water from four mines in the upper Isaac River during the coming wet season,” he said.

“We look forward to continuing to work with the Newman government to ensure the health of the Fitzroy River system, while minimising the disruption to mining activities as a result of weather events such as in 2011.”

Roche said the Bligh government’s mismanagement of the 2011 emergency cost Queensland $9 billion in coal exports and approximately $750 million in royalties that would have gone to pay for public servants and government services.

“The feasibility study announced today comes on top of new legislation for managing water in flood emergencies, which was a key recommendation of the Queensland Flood Commission of Inquiry,” he said.

“The Queensland Resources Council will be happy to share the findings of work it commissioned in 2011 on the feasibility of such a scheme.”

The QRC commissioned the Centre for Water in the Minerals Industry to report on the feasibility of an STS approach for the Fitzroy, starting with a comparison of the existing Hunter Valley STS in NSW.

“The first stage of the work on the Hunter River STS was completed earlier this year and the second phase is nearing completion,” Roche said.

“The assessment of Hunter scheme found that it was successful in managing salinity.”

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