Queensland coal mining is in a worse state than it’s been in for decades, with a third of coal mines not making money, a new report has revealed.
And things are so bad that the Queensland Resources Council (QRC) is now asking the state government for emergency relief.
The report, released recently by mining sector analysts Wood Mackenzie, found a third of Queensland coal mines are running at a loss and more than half of the mines producing thermal coal for power stations are in the same position.
Thousands of jobs lost
QRC chief executive Michael Roche said 21 000 jobs have been lost in Queensland’s resources sector — and unless the state government steps up, the remaining 60 000 jobs could go too.
He is expected to discuss an emergency royalties regime at a meeting with Premier Annastacia Palaszczuk and her jobs committee. Roche said he commissioned the study after a summer of dire meetings with mining and gas company chiefs. “They were saying this is one of the most challenging times in the last 50 years, never seen it this bad.”
“If the unprofitable mines are to shut down it would cost the state hundreds of millions of dollars.” The only reason some coal mines were still open is because they had fixed rail and port charges to cover, Roche said.
“So even in these grim times, the government and private sector service providers of port, rail, energy and water services — they are not offering any relief,” he said. He wants the premier to look at what government-owned and private sector providers can do to ease those pressures.
Government to ease the pressure
“We’re not looking for a bail out,” Roche said. “We are looking for the government to recognise that one of the biggest job generators in this state, one of the biggest sources of government revenue, is under huge pressure.” The state government has been contacted for comment on the report.
But anti-mining group Lock the Gate Alliance said it was a bit rich for the coal industry to be crying poor because boom times had come to an inevitable end.
“The industry is inherently cyclical and there is no case for industry relief,” spokesman Drew Hutton said in a statement.
The government must examine ways to diversify the economy and should not be subsidising poorly managed businesses, he said.
The Australian Conservation Foundation (ACF) said the report showed the coal industry was not financially viable, despite hundreds of millions of dollars in subsidies each year.
“ACF urges the federal and Queensland governments to invest in industries with ongoing job opportunities, like renewable energy and tourism,” chief executive Kelly O’Shanassy said.
ACF is challenging federal approvals for Adani’s $16.5 billion Carmichael coalmine in Queensland’s Galilee Basin.
Elsewhere, the report found liquefied natural gas producers were covering their costs but it would take time before they started turning profits.