Rio Tinto energy chief executive Doug Ritchie told the Coaltrans conference in Brisbane yesterday the company regarded energy efficiency and carbon reduction as vital issues that should be considered at all its operations and associated infrastructure.
“At Rio Tinto we have already invested significantly in the economics around climate change,” he said.
“Carbon costs are taken into account in all of Rio Tinto’s investment proposals and the company has conducted abatement curve analysis at every one of its mines, and then revisited it.
“During last year’s CPRS debate, fugitive methane emissions were put in the ‘too-hard basket’ – industry argued the gas was ‘impossible’ to quantify and therefore it should be excluded from being taxed.
“So if the industry itself is giving the impression that it’s all too hard … why would the public or our policy makers think any differently?
“Our industry is working with ACALET on low emissions coal technology – but I’m sure most of us in the room will not be happy with the slow process to date.
“We’ve also commissioned ACARP to undertake research to give us a better understanding of the fugitive emission profile.”
Individual companies are also doing work on fugitive gas emission control. The Rio Tinto-managed Mount Thorley Warkworth coal mine in the Hunter Valley of New South Wales is trialling the capture and flaring of fugitive coal seam methane prior to mining.
“We analyse existing operations and are doing research on new technologies, including looking at the potential for wind power at many of our operations, to supporting the implementation of new technologies such as autonomous trucks which provide a step change in energy efficiency at the operations,” Ritchie said.
In the past decade, Rio Tinto has spent more than $100 million on low emission coal technologies.
This has been spent on direct research and development, such as the CRC for CO2, through to investment in Hydrogen Energy, its joint venture project with BP in California which is nearing completion of prefeasibility.
This plant will use Petcoke and coal as fuel and will install 90% capture of CO2 for storage in offshore oil fields.
“This spend is helping create the enabling pathway to the commercial development of these technologies,” Ritchie said.
He said infrastructure in Australia had long been an issue for the mining industry – with coal chain constraints in the past unable to keep up with demand, and its associated environmental problems.
“Last year an historic agreement was signed between the New South Wales government and Newcastle Port’s two coal terminal operators for a long-term export plan for the Hunter coal Industry,” he said.
“The agreement will enable coal producers to sign long-term contracts for coal export throughput, providing certainty to underpin port expansion and certainty for future production planning.
“Since the new agreement took effect in January, contracted capacity at Port Waratah Coal Services has been growing.
“If growth continues at the current rates forecast to 2012, by 2014 we could see an extra 25-30 million tonnes per annum of additional exports. Notionally, on the basis of coal fetching $100 a tonne, that would be worth an additional $3 billion in revenue at today’s prices.”
In Queensland, the coal industry is also seeking to work with the government to help alleviate the highly fragmented nature of this state’s public infrastructure.
The majority of Queensland coal producers have made a consortia bid to the state government for the Queensland Rail coal freight tracks, as an alternative to the government’s proposal to sell its rail assets as a monopoly.
“We are convinced that this is in the best interests of Queensland,” he said.