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Queensland – Sunshine State or Mining State?

Kim Brebach - Friday, August 25, 2017

Queensland Sunshine State or Mining State - Update | Technoledge

The vast Carmichael Coal Mine in Queensland proposed by the Adani Group has been a political hot potato for years. Yet, despite no benefits financial, community or environmental, Aussie politicians have been lining up to support it. We update our previous post with insights from ABC's 4 Corners. 

A brief update

On October 2nd 2017, the ABC's 4 Corners dug into Adani's affairs and came up with a lot of dirt. Another piece from the Guardian shows the real reason Adani needs the mine: so its Abbot Point port can stop losing money. On November 3, Premier Palaszczuk vetoed the unpopular $1 billion loan for Adani she had previously supported with PM Malcolm Turnbull, just days after announcing an election. Demonstrations against the mine have recently become national, well-attended and well-publicised. It's pretty clear why the Premier changed her mind: her support could be a big electoral liability.   

This is the post we wrote a few weeks ago:

Queensland has been 'The Sunshine State' for decades, so isn't it the obvious place to capitalise on free sunshine to create clean energy? Why then is this state laying out the red carpet for a mining venture with high cost, extreme risk and no benefit? We dive into the grubby groundwater of mining and politics to find out. 

Adani off to a clean start

On August 11 2017, the Commonwealth Bank ruled out lending money to Adani’s proposed Carmichael mega coal mine in Queensland’s Galilee Basin. On the same day, Adani was fined $12,000 for a stormwater breach at its Abbot Point coal terminal during Cyclone Debbie. A week later, Adani stood accused of financial fraud in India - of moving nearly $235 million into overseas tax havens, and the New Indian Express reported that the Indian Congress has demanded a supreme-court-monitored probe into these accusations.

Abbot Point Bulk Coal was granted a temporary licence to more than triple its ‘suspended solids’ releases during the severe weather in March, yet ‘more than eight times that amount was released into the ocean,’ according to a report in the Sydney Morning Herald.

Adani [somehow] avoided a multi-million dollar fine, ABC News reported and quoted Mackay Conservation Group coordinator Peter McCallum, who said: ‘It is hard to see how this fine can act as a deterrent. Adani made over $250 million in revenue at Abbot Point in the last financial year, with this fine representing a miniscule 0.005 per cent.’

Source: Aurecon

Does Queensland need Adani?

Adani’s plans for its Carmichaek mega mine has attracted a lot of press about in recent months, yet vital questions remain unanswered. Why is Queensland’s premier, Annastacia Palaszczuk, prepared to defy logic to progress this project? For instance, why is she happy to:

There must be a reason, surely.

Queensland’s Clean Energy Pledge

Adani’s Carmichael Mine project has soaked up so much media attention that few people South of the border know about Queensland’s ambitious target for renewable energy: by 2030, 50% of the state’s power will come from renewables. That’s the plan. How odd.

Source: AFR

‘We have set a target for one million rooftops or 3,000 megawatts of solar photovoltaics in Queensland by 2020,’ says the government’s website. ‘This will help lower electricity costs for families and businesses, create jobs and protect the environment.’ Queensland has 425,000 households with solar power, the highest number of installations of any state in Australia. So does Queensland need Adani? It would seem not.

Sheer Madness?

Barnaby Joyce’s response was swift: He described Queensland's 50% renewable energy target as ‘bonkers mad’, according to the Sydney Morning Herald, and added that Queensland should not be following the example of South Australia, which he described as a ‘basket case.’ With ‘the biggest coal resources on the planet,’ Joyce said Queensland should focus on developing affordable, reliable, coal-fired power stations.’

Queensland’s Energy Minister Mark Bailey responded in kind, saying: ‘What's bonkers is sticking your head in the sand and pretending climate change doesn't exist,’ and adding that Queensland was committed to a clean energy future … and committed to ‘protecting the Great Barrier Reef while maintaining economic growth and jobs in our regions.’

Financial Madness?

Queensland Premier Annastacia Palaszczuk, who clearly isn’t listening to her energy minister, has been courting Indian billionaire Gautam Adani with inducements like unlimited use of water from the Artesian Basin for the next 60 years and deferred payments of royalties for the first 5 years of the project. She's also been urging the federal government to fast-track a $1 billion taxpayer-funded concessional loan needed to build Adani's rail line to its coal port at Abbot Point.

Source: Courier Mail

For the first 5 years Adani would pay just $5 million a year in royalties, but the premier insists that the company has to pay all their royalties on the Carmichael Mine with interest. The Greens calculated that this deal will cost Queensland $253 million; another issue is that the interest rate has not been made public.

Environmental Madness?

The Queensland government has also released a blueprint for extensive dredging near the Great Barrier Reef, around 5 mega ports along the Queensland coast, including Abbott Point on the Great Barrier Reef. In addition, the Townsville Bulletin reports that Mining floodgates [are] set to open for Townsville and Central Queensland.’  

The Bulletin quotes Mines and State Development Minister Anthony Lynham who said, ‘Adani could pave the way for billions of dollars of development and thousands of more jobs in Central and North Queensland, including the start-up of several mega-mines.’

How does the Carmichael Mine project fit with Energy Minister Mark Bailey’s claim of a Queensland committed to a clean energy future and to protecting the Great Barrier Reef? Or with this statement from the premier reported in the Brisbane Times: ‘The renewables are coming and they're coming to regional Queensland and I'm not going to put hundreds if not thousands of jobs at risk.’

Jobs? What Jobs?

The official upside of Adani’s Carmichael Mine project is 10,000 jobs. According to The Sydney Morning Herald, Adani's own expert, Jerome Fahrer from ACIL Allen, conceded 1464 jobs would be created. The Minister for Northern Australia, Matt Canavan, claims that there will be more jobs for ‘secretaries, for lawyers, for bankers, for nurses, because there'll be more people here.’

Does Canavan not know that mining has become a highly automated industry? Computerworld reports that ‘This industry is adopting self-driving trucks, automated loaders and automated drilling and tunnel-boring systems. It is also testing fully autonomous long-distance trains.’

Source: MIT Technology Review

Rio Tinto is a current example, pushing automation hard in order to improve profits and reduce staff numbers. It ‘gave the job of overseeing its autonomous trucks to staff at the company’s control centre in Perth, 750 miles to the south [of its mine in WA],’ reports MIT technology Review. ‘The centre already plans train movements and in the future will shift from sending orders to people to directing driverless locomotives.’ So much for thousands more jobs in North Queensland.

A Smarter Solution

Fitting another half a million Queensland homes with solar panels will create many jobs, but encouraging solar energy companies to set up research and production facilities would create many more. Why doesn’t the premier see that the money she wants to throw Adani’s way would be far better spent supporting renewable technology hubs in North Queensland?

Despite the premier’s myopia, reneweconomy.com.au reports that ‘some 4,200MW of large-scale wind and solar projects, all of them in central to northern Queensland, and billions of dollars worth of other projects are in the pipeline, including biofuels and even a battery gigafactory in Townsville. The Australian reports that ‘Plans for a Bill Moss-led consortium to build a $US1.6 billion lithium-ion battery factory in Australia have moved a step closer with the Townsville City Council to grant part of a former CSIRO research station to the group in exchange for equity in the massive project.’

Smarter Entrepreneurs

These projects seem to be happening without much help from the state government, even if Energy Minister Mark Bailey trumpets these achievements on the government’s website. He says the right hand is not talking to the left in Canberra. ‘One minute they’re providing funding for renewable projects like this, and then trashing renewables as a risk to our energy system the next.’

Source: Manufacturers Monthly

We could say the same about Queensland, which brings us back to the question we asked at the beginning: Why are the Queensland premier and even our Prime Minister bending over backwards to lay out the red carpet for an Indian billionaire looking for financial backers?

Adani can't find commercial backers for this venture for the simple reason that no major new investments are going into coal. Renewable energy is already competitive with fossil fuels in cost terms, and getting more so every year. There’s no future in coal, but there’s a huge future in renewables.

We’ve looked high and low for an answer or even a hint of one, and we see no logic in this. Bonkers yes, but who’s bonkers here, I wonder.


BTW, if you have story to tell and no time to blog, give us a call. It;s how we help many other busy execs. . 

Kim Brebach
Content Chief

I've always loved people and words. As long as I can remember, I've been a story-teller and the team here says I'm pretty good at it. That's probably why I head up the Content Team: I create the arc of the story and others add their magic. 

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