ACCC approves Hunter Valley export solution

The ACCC will grant conditional interim authorisation to PWCS, NCIG and NPC to provide a long term solution to continuing capacity constraints in the Hunter Valley coal chain.

The Australian Competition and Consumer Commission (ACCC) will grant conditional interim authorisation to Port Waratah Coal Services (PWCS), the Newcastle Coal Infrastructure Group (NCIG) and the Newcastle Port Corporation (NPC) to begin the phased implementation of arrangements to provide a long term solution to continuing capacity constraints in the Hunter Valley coal chain.

PWCS can now ask coal producers to nominate their capacity requirements for export coal.

As a result, coal chain system capacity can be modelled and long term contracts entered into that will underpin future investment and the efficient operation of the coal chain.

“The ACCC considers that the proposed arrangements are materially different to capacity balancing schemes previously authorised, with new features starting to introduce efficient commercial incentives across the entire coal chain,” ACCC chairman Graeme Samuel said today.

“The ACCC also notes that the industry, assisted by the NSW Government, has made significant progress in developing long term Capacity Framework Arrangements. Therefore, the ACCC considers that granting interim authorisation is unlikely to further delay the achievement of a long term solution in the Hunter Valley and in fact will assist it.”

The applicants have committed to finalise and execute a suite of documents that will set out the detailed framework for the long term solution by 31 August 2009.

The ACCC has said that it will revoke interim authorisation if applicants fail to meet the 31 August deadline.

PWCS today welcomed interim authorisation, saying the long term plan enables PWCS to secure long-term 10-year contracts with its coal producing customers.

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