PERTH (miningweekly.com) – Queensland Premier Campbell Newman on Monday announced that the state would invest in infrastructure projects to allow for the exploitation of resources.
Newman said that the state government would work with resource companies to make strategic investments that could create up to 28 000 new jobs, with the government announcing its willingness to take a short-term, financial stake in the rail, port or other infrastructure needed to open up the region.
“Our government is determined to support projects and industries that will grow Queensland jobs, and the Galilee basin offers an enormous opportunity to do that,” Newman said.
“To build on our Galilee Basin Development Strategy, we are now prepared to sign agreements with Galilee basin proponents who can demonstrate they will meet the majority of the cost of providing this common-user infrastructure.”
The first infrastructure enabling agreement would be signed with India’s Adani to build the rail line needed to link the $16.5-billion Carmichael project to the Port of Abbot Point.
“The Carmichael project could create almost 6 500 jobs and this agreement will see the Queensland government invest in the rail line needed to carry coal to port,” Newman said.
The mine and rail project had received both state and commonwealth environmental approval and would be subject to 226 environmental conditions.
The rail line would take around two years to build, employ about 2 400 people and would pump up to A$790-million into the Mackay region and over A$900-million into the state economy during its construction phase. The proposed standard gauge greenfield rail line will cost A$2.2-billion and be able to transport 100-million tonnes of coal a year.
Deputy Premier and Minister for State Development, Infrastructure and Planning Jeff Seeney pointed out that Adani’s Carmichael project was expected to inject A$500-million into Queensland’s economy during construction and A$3-billion at full export capacity.
“This is the revenue that will build the schools, hospitals and roads our state needs in the future. Our decision to help build the rail link for this project will get it happening more quickly and ensure its benefits start to flow to the people of Queensland.”
Seeney added that while the first agreement had been inked with Adani, the state government was open to negotiating similar agreements with all proposed Galilee basin miners.
The Queensland Resources Council (QRC) on Monday welcomed the state government’s decision, with CEO Michael Roche saying the plan to invest in the Galilee basin was a combination of hard-headed commercial investment and a visionary approach to securing long-term benefits for the state.
“The end game is the creation of tens of thousands of jobs and a new wave of economic activity when the state needs it most.”
Meanwhile, QRC also welcomed the State Bank of India’s decision to extend a $1-billion line of credit to Adani to partly fund the Carmichael project.
“It is a good day for coal all around with the widely tipped news that an Australia-China Free Trade Agreement will include cuts to tariffs currently levied on exports of Australian coking and thermal coal,” Roche said.
“For Queensland, this is particularly significant as our coal exports to China were valued at A$5.9-billion last financial year, with coking coal worth A$5-billion.”
Adani Australia CEO Jeyakumar Janakaraj said on Monday that the state agreement reflected the Queensland government’s focus on ensuring the state is a leading energy exporter and job creator for Australia into the future.
“Adani is well-established in building its long-term future with Queensland, with several billion dollars in investments already made across the company's integrated mine, rail and port project.
“The Queensland government's announcement that it will pursue an infrastructure enabling investment strategy is a welcome one. It gives confidence to investors who are considering their long-term plans in the basin that the state is committed to the best possible infrastructure being in place to support the further development of the Galilee, and the jobs and exports that will provide,” he added.