New Queensland Government with new (and refreshing) change to mining related infrastructure

Although it is still early days, the Queensland Government has displayed a radically different and refreshing approach to mining infrastructure to that of the previous Labor government.

The previous government’s approach was light handed. It left planning of ports to GOCs, and believed that coordination was best achieved by the forces of competition and commercial resolution.

While in theory the previous government’s approach has merit, in practice it meant that infrastructure delivery was delayed while miners hedged their bets by applying for capacity at every planned port. This is turn lead to delays in QR Network’s ability to determine what coal systems needed expansion.

In a relatively short period the Queensland Government has made significant changes to key mining infrastructure projects. The most significant of these changes is the re-setting of development at Abbot Point T4-T9. The government seems to have taken a view that the planned MCF was not feasible (economically or environmentally) and that 6 terminals was overkill. Both of these views were correct.

The government’s changes to T4-T9 signals a radically different approach to mining infrastructure generally. In particular, that the government will be very hands on and will act decisively with a view to bringing on development. That new approach should be applauded.

The government do however face a number of challenges:

• Understanding a very complicated coal chain, including:
• unlocking capacity through coordination; and
• developing an efficient process for development of rail expansions (where SUFA will be crucial);
• Developing a new model for development of Abbot Point T4-T9;
• Water transportation issues.