PERTH (miningweekly.com) – A group of coal miners, including some of the world’s top producers, would bid for ownership of Queensland’s State-owned coal rail network, to counter a privatisation model pursued by the state government, a local resources council said on Monday.

Coal producers were “unanimous” in their view that the Queensland Rail (QR) coal business privatisation model involving a A$3-billion initial public offering (IPO) was not in the interest of the coal sector, Queensland Resources Council CEO Michael Roche said in a statement.

The Queensland government was looking to divest of QR's coal, freight and infrastructure servicing businesses by selling the assets as an integrated transport and logistics enterprise through an IPO.

The government is proposing to initially retain between 25% and 40% of the new QR. The remaining percentage of the new business would be offered for sale through an IPO.

The divested QR is expected to float on the ASX by the end of this year.

The state government would retain ownership of the passenger service business and assets, including ownership of the metropolitan rail networks, and retain regional freight networks and associated operations.

Roche said that the Queensland coal miners were concerned about the performance of the infrastructure under the structure proposed by the government, whereby a privatised QR National would both control the coal track network, as well as operate a rail haulage business in competition with other haulage operators using that track.

“Of particular concern, is that the government’s existing proposal to float a vertically integrated coal business will severely limit investment in the new rail capacity needed for industry growth and new job creation,” he said.

Roche pointed out that coal producers, as owners of the coal track network, had a “strong incentive” to ensure a high-performing network and to make timely investment in new rail capacity to avoid export bottlenecks.

He said the coal industry would not ask the Queensland government to abandon the public float process, but that it wanted an opportunity to provide an alternative bid.

“As Queensland's largest export industry, employing tens of thousands of Queenslanders and delivering A$3-billion in royalties last financial year, the coal industry surely deserves the opportunity to have its alternative offer taken seriously,” Roche said.

Roche said the Queensland coal industry would seek early discussions with Queensland Premier Anna Bligh and key stakeholders on the industry approach.

Companies attending the Brisbane meeting included 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.

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