Anglo sends a warning to Canberra

ANGLO American chief executive Cynthia Carroll has warned that the Australian government could lose more than $A1 billion in royalties under the proposed Carbon Pollution Reduction Scheme from the premature closure of two major mines.
Anglo sends a warning to Canberra Anglo sends a warning to Canberra Anglo sends a warning to Canberra Anglo sends a warning to Canberra Anglo sends a warning to Canberra

Anglo American CEO Cynthia Carroll

Blair Price

Speaking at the Brisbane Mining Club on Monday during her tour down under, Carroll advocated the exclusion of coal fugitive emissions from the scheme until technology allowed these emissions to be fully abated.

She also wanted the scheme’s transitional assistance rules to be fairly applied to the coal industry and assistance provided to mines which could not pass through the scheme’s costs.

Having discussed the limitations of developing carbon abatement technologies, especially carbon capture and storage, she outlined what the CPRS could cost the coal industry and Anglo Coal’s operations.

“In the absence of available technology, the coal industry here will be paying a massive tax on emissions,” she said.

“The total CPRS bill for the Australian coal industry is an estimated $14 billion in the first 10 years of the scheme, including $118 million each year in respect of Anglo American’s operations here – money that is urgently needed for investment in abatement activity.

“So Australia’s coal mines would not only be at a major competitive disadvantage, it could also lead to a larger carbon footprint from the industry.

“And it would impact jobs as well. In Anglo American alone, we risk premature closure by 10 years of two major mines and job losses of more than 2000 people, not to mention royalties of over $1 billion lost to the government.”

She also commented on how the scheme affected planning and future mining investment in Australia.

“We need clearer carbon-price signals – what will the price of carbon be? We need stable long-term regulatory frameworks to support the deployment of new technologies and appropriate transitional arrangements to allow business to adapt to huge structural change to the world’s economy.

“Give the private sector these three things and we’ll be far better placed to make our investment choices.”

Carroll adds to the chorus of concerns from the coal industry, backed by several independent reports, while Xstrata Coal group executive Mick Buffier has already stated the scheme would be a major impediment to future investment and needed to be more aligned to other nations.

“Coverage of fugitive emissions from coal mining has not been attempted anywhere globally,” he said at the NSW Mineral Exploration & Investment conference last month.

India has signalled it will not commit to emissions targets, while climate change advocate and economist Ross Garnaut is currently in China lobbying for that country to make commitments in the lead-up to the Copenhagen summit in December.

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