GALILEE is the Promised Land. It should have been the Australian Labor Party’s gift to fight global warming and global poverty. Galilee’s riches will protect, feed and clothe the poor and hungry of China and India more surely than carbon taxes and foreign aid.
The Galilee Basin in central Queensland, in the not too distant future, will provide the sort of wealth that really counts, thermal coal for electricity; and it is electricity, cheap and bountiful that turns Third World nations into First World nations.
Among other things, Australia’s gift to the world is coal, and coal generates 42 per cent of the world’s electricity. No amount of renewable energy will get the developing world to developed world status.
Only First World peoples will readily withstand whatever adversity climate variability may bring. And no amount of forcing renewables on to consumers with massive subsidies will stop Australian coal production for the developed world. It will just make it more expensive.
But Labor chose to turn its back on its own worker base and threw in its lot with dreamers. It turned its back on its obligation to produce coal at least cost; coal that the developing world needs to bridge the development gap.
It should have argued the case that Australia’s skilful stewardship of its immense coal resources would help the world’s responses to major challenges. It could perhaps have chosen to wind down the production of brown coal as the least energy-efficient and most polluting coal to demonstrate its solidarity with the climate change abatement strategy.
Instead, knowing that the world needs coal for the best possible purpose, to make people secure and well, it chose to punish all coal. It chose to tax its own bounty to no environmental gain and to belittle its own skills.
Its own union base chose to demean, in the eyes of the public, its traditions of worthy production. Instead, it chose to claim the moral high ground by accepting a carbon tax (and renewables subsidies), in effect sending the bill to the taxpayer for subsidising its continuing coal production.
China and India are heavily dependent on coal for electricity, 80 per cent and 70 per cent respectively. For all of China and India’s striving to reduce their dependence on coal through renewables (mainly hydro) and nuclear, China and India will help triple the world thermal demand by 2030.
China’s coal imports are expected to grow from 120 million tonnes per annum last year to more than 1000mtpa by 2030. India’s coal imports are expected to grow from 90mtpa last year to 266mtpa in 2030. Seaborne supply of thermal coal is dominated by Indonesia and Australia, which account for an estimated 60 per cent of seaborne thermal supply.
Australian thermal coal exports are expected to increase from 145mtpa last year to 654mtpa by 2030. Much of this coal will come from the Galilee Basin.
There are five major coal producers in the Galilee Basin. There are significant Chinese (Macmines) and Indian (GVK and Adani), as well as US (AMCI) and Australian (Waratah Coal) ownership. In the next few years there will be up to eight new mines producing between 30mtpa and 60mtpa. Each of these will rank among the largest thermal coalmines in the world.
These mines (and many others in the 10 coal basins in Queensland) will require more than $12 billion in infrastructure investment before even digging a hole in the ground. Power lines, water, rail lines and the Abbot Point port are huge requirements. These investments would not be made without a strong sense that the market demands the product.
The closest town to most mines, Clermont, inland from Mackay, is likely to flourish. In addition to a fly-in, fly-out workforce, each mine will require 1500 to 3000 permanent workers. Their families will create demand for significant inland development. Each mine has an estimated life of more than 30 years, some considerably longer. One proponent suggests Clermont may in time equal a city the size of Mackay, which has reached 100,000 on the back of Bowen Basin coal.
Australia has a strategic hand to play in world affairs as a producer of raw materials. Its best engineers and skilled workers are trained to undertake this work. Coal will continue to be extracted in Australia for perhaps another 100 years, by which time substitute sources of energy will well and truly be in play. Unfortunately, Labor and the dreamers turned their back on our strength, belittling our bounty and by implication our productive efforts.
When Labor contemplates its foolish slide towards the Greens and their obsession with a global warming abatement strategy, and a handout foreign aid policy, it will rue the day it turned its back on coalminers and their families.