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Many Queenslanders believe Adani mine does pass muster

By Gary Johns - posted Friday, 11 August 2017


Broadcaster Alan Jones is a climate sceptic who campaigns against renewables, drilling gas and digging coal. Which makes it pretty hard to live.

Jones, who famously has protected farming interests against gas drilling in NSW and Queensland, last week sprayed the Adani company for its proposed Carmichael mine in the Galilee Basin in north Queensland. Jones thinks the proposal “doesn’t pass muster” because the mine will be a blot on the landscape with open pits 30km long; the coal will be of low quality; Adani wants a concessional loan from the commonwealth to help build a rail line; that coal from Galilee will diminish production from existing mines; and more. True, a big mine creates a big hole, but Victorians have lived with several in the Latrobe Valley for a century. Residents in the Hunter, Surat and Bowen basins seem content with their holes.

Besides, just how “big” is a big hole? The total Carmichael site - open-cut and underground mines, airport, rail and other infrastructure - covers 45,000ha. Then again, while the Badgerys Creek airport site will be only 2000ha, the nearest residence will be 10.5km from the runway, so a big hole in Sydney. The Adani project is a long way from anywhere. The nearest town is Clermont, 160km away, and Clermont is 300km from Mackay. Pretty remote.

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Adani believes the coal is good, certainly of sufficient quality to burn in power stations in India. And it is cheap enough because much of it will be easy to access, to outbid other Australian mines.

Which is another part of the Jones critique. Jones quoted an economic study by Wood Mackenzie that forecasts reductions in future coal output from the Hunter, Surat and Bowen basins.

Which is strange. If the Carmichael coal is of such low quality, how could it compete with other producers? More important, using the logic employed by the study, would any coal region have opened before all existing mines were exhausted?

The report says Australia’s coal exports would be better off “net about 50 million tonnes” with the Galilee Basin than without.

The study is an old scare used by protectionists to lock out competition. Any drop in price, or royalties, due to extra supply should be welcome news for consumers but is unlikely to last.

Jones also accuses Adani of using the mine as a stalking horse to own and control the rail system from the Galilee Basin to make a profit by charging other users to follow. The rail line will open up a new frontier, and there are about eight mines slated for the basin. The first entrant would not expect to carry the cost alone of servicing the region. Either a government helps to get the line started, or a means of charging later users has to be part of the arrangement.

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The only accurate part of Jones’s liturgy is that numerous banks have refused to finance the Adani proposal. Which is about the position the commonwealth finds ­itself in seeking finance to build Badgerys Creek airport. Keep in mind that the Chinese are buying many of Australia’s coal interests. It seems like a version of backpackers in the agricultural sector. Australians no longer want dirty work, so we leave it to others.

But the tribulations of finance have not stopped Adani from canvassing future suppliers and employees in Mackay and Rock­hampton, which would be two of the primary bases for the Carmichael coalmine.

Adani may still be hunting for credit but, having spent $3 billion already, it is not about to walk away. Nor is it about to buckle in the face of a couple of pimply-faced kids who last week stood outside the Mackay Chamber of Commerce protesting.

A weekend Galaxy Poll found that 50 per cent of voters in Queensland support a coal-fired power station in north Queensland. Support was strongest in regional Queensland and among Liberal National Party voters.

The world looks a lot different from here, Alan. You should come and meet the locals. I am sure they would give you a warm welcome.

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This article was first published in The Australian.



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About the Author

Gary Johns is a fellow of the Australian Institute for Progress and an adjunct professor at QUT.

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