PERTH (miningweekly.com) – The Queensland Coal Industry Rail Group (QCIRG), comprising the 14 largest coal companies in the state, has made a commitment to deliver an early industry offer for the Queensland rail assets proposed for sale by the Queensland government.

The state plans to sell Queensland Rail's (QR’s) coal, freight and infrastructure servicing businesses through a A$3-billion initial public offering (IPO) by the end of the year.

QCIRG chairperson Nick Greiner said that a meeting of senior executives from the coal companies earlier this week, had agreed on a range of key elements, and would move to prepare a full industry proposal as an alternative to the proposed IPO of the rail assets.

“The coal companies are fully committed to delivering to the Premier an attractive alternative once the full details are developed,” he said.

The QCIRG includes companies such as Anglo Coal Australia, BHP Billiton Mitsubishi Alliance, Ensham Resources, Felix Resources, Jellinbah Resources, Macarthur Coal, New Hope Coal Australia, Peabody Energy, QCoal, Rio Tinto Coal Australia, Vale, Wesfarmers Resources and Xstrata Coal.

Queensland Resources Council CEO Michael Roche repeated earlier comments that the QR coal business privatisation model was not in the interest of the coal industry.

“Strong rail infrastructure performance is critical to the coal industry’s ability to stay Queensland’s and Australia’s largest export industry,” Roche said.

He noted that the proposal to float a vertically integrated coal business would “severely” limit investment in the new rail capacity needed for industry growth and new job creation, while the coal miners, as the owners of the rail track, would have an incentive to ensure a high performing network.

Queensland Premier Anna Bligh has previously said that that QR would be sold by way of a public flotation, and as such, the coal miners would be subject to the same restrictions as any other individual or consortium which wished to invest in the company, meaning a 15% ownership restriction.

The state government plans to retain ownership of QR’s passenger service business and assets, including ownership of the metropolitan rail networks, and retain regional freight networks and associated operations.

To subscribe to Mining Weekly's print magazine email subscriptions@creamermedia.co.za or buy now.