The Queensland Government has today revealed a plan it hopes will drive mining development in the State’s Galilee Basin.
Speaking at the Major Projects Conference in Brisbane today, Premier Campbell Newman announced plans to offer a discount on royalties for companies who commit to mining in the region.
Under the plan, these “first movers” could also be granted access to the T2 site at Abbot Point near Bowen.
The government hopes the initiative will accelerate development and get projects off the ground in the Galilee Basin which it estimates could create up to 28,000 jobs.
"My government is unashamedly all about growing the business of Queensland and we will do all we can to facilitate the projects proposed for the Galilee Basin," Newman said.
The Deputy Premier and State Development, Infrastructure and Planning Minister Jeff Seeney said the proposed projects had a total forecast investment of $28.4 billion and would provide over 15,000 jobs during construction and over 13,000 operational jobs.
“Companies that are currently investigating opening mines in the Galilee Basin are contemplating many billions of dollars of investments,” Seeney said.
“My government is mindful of the financial magnitude of these investments and the long lead times between financial commitment and shipping the first coal to its offshore destination, which is why we are offering incentives.”
Seeney said The Galilee Basin Development Strategy includes a “ramp-up-to-royalty initiative whereby the government will consider offering reduced royalties for an initial period of time”.
“These incentives, along with the strategy’s streamlined solutions for planning, land acquisition, water, power and rail, will ensure projects have the best chance of going ahead in the Galilee Basin,” he said.
Queensland Resources Council Chief Executive Michael Roche has welcomed the royalty relief plan.
“Anything that you can do to make a whole new coal province like the Galilee Basin more attractive to investors has to be good news,” he said.
Roche said the strategy contains some innovative proposals which will help projects in their early stages and assist them to overcome stumbling blocks inherent with the Galilee Basin location including distance to ports and the lack of existing infrastructure.
“To get a project up and running in the Galilee Basin you’re talking about $10 billion dollars of investments,” he said.
“A typical Galilee Basin mine will be about three times as large as the mines you see in the Bowen Basin, they will be there for many decades, there’s more and more coal being found in the Galilee Basin every week, so there’s probably over 30 billion tonnes of coal in the ground.”
Roche explained that eventually these projects will have to stand on their own but this strategy is designed to help Galilee mining projects over the line during difficult market conditions.
“The combination of the coordination powers of government together with some royalty reliefs may well make the difference,” he said.
Roche said this strategy will help create jobs and deliver a royalty stream for decades to come.
“You’re looking at projects that will run for 30 years that will employ directly and indirectly thousands and thousands of Queenslanders,” he said.
“A smaller investment upfront will be paid off many times over.”
Roche said he would like to see the royalty relief concept extended beyond Galilee Basin projects in an effort to get greenfield coal, minerals and uranium projects around the state off the ground.
Mining magnate turned politician, Clive Palmer said the plan is an example of the Queensland Government desperately trying to revitalise the Galilee Basin.
Palmer’s company Waratah Coal has slated a $6.4 billion thermal coal mine for the region which would be linked to the coal terminal at Abbot Point by a new 453 kilometre standard gauge, heavy haul railway line.
Palmer said establishing the mine and associated infrastructure will create 6,000 jobs during construction and 2,460 jobs during operation in a massive boost to the state and national economies.
The Federal Government signed off on GVK Hancock’s Kevin’s Corner project in Queensland earlier this week, making it one of the country’s largest coal mines.