Four Big Coal Stories

It’s amazing how controversial decisions just happen to be made in the days before Christmas. It’s almost as if decision makers didn’t want anyone to notice. So we thought we’d wait until February, once everyone is good and ready, to bring you December’s big New South Wales coal stories.

We won another court case!!!

As the Newcastle Herald reported:

The Ashton South East open-cut coalmine near Camberwell has been dealt a show-stopping blow in the Land and Environment Court, with conditions placed on its approval almost certainly ensuring it can not proceed.

Some explanation is required here around the terms “we” and “won”.

TAI’s Richard Denniss and Rod Campbell gave evidence to the court in 2013 showing that the economic benefits of the mine had been heavily overstated by the mining company, Yancoal, and their hired economists. While the judge accepted this, she also felt there was enough benefit that mine could proceed subject to certain conditions.

Throughout 2014, the community of Camberwell, the Hunter Environment Lobby, the Environmental Defenders Office NSW and their barristers fought it out in court over these conditions. Their efforts were rewarded on 21 December when the judge declared the mine could only go ahead if Yancoal owns all the land required. It doesn’t. Sixth-generation farmer Wendy Bowman owns much of the land and she has no inclination to sell.

Yancoal has appealed the decision to the NSW Court of Appeal, so expect more news in December.

Newcastle Coal Terminal 4

Have you ever made a $60 billion error? No? You clearly don’t consult to the coal industry.

The original economic assessment of the proposal to build a new coal terminal in Newcastle estimated the project could be worth $60 billion. We made several submissions suggesting the actual figure would be closer to zero. (Here, here and in the news here and here)

The key assumption in the coal economist’s economic model is that if the terminal is built, then it would be used. We pointed out that with many mines currently losing money, there was no way NSW could profitably supply another 70 million tonnes per year on top of current production.

Our submissions led the Planning Assessment Commission (PAC) to commission a review of all economic assessment and submissions on the project. The review found:

The Proponent does not offer any evidence to suggest that the increased rate at which coal can or will be extracted and transported to the Port is plausible.

The PAC accepted the review’s opinion that “the project would not be needed until after 2023.”

In an interesting move, the PAC recommended the project be approved, but with a window of approval of only five years, saying that to provide the usual 10 year window might mean:

Sanctioning a project out of step with potential changes to air quality standards and greenhouse gas policies.

Did you get that? Decision makers in Australia starting to consider greenhouse gas policies in their decisions. Now we’re getting somewhere.

Furthermore, the PAC declared that the Terminal’s seabird habitat offsets had to actually be working before construction could start. They were specific:

[The offset] should be functioning for a minimum of three years to be confident of documenting at least one successful season of usage by migratory shorebirds.

We think the T4 project should have been rejected, but the PAC insisting on offsets working prior to construction and considering air quality and climate change is a significant step forward.

Warkworth saga continues

The long-running fight between the town of Bulga and Rio Tinto’s Warkworth mine continues.

Having lost in court twice (Richard and Rod gave influential evidence the first time around), Rio convinced the NSW government to change legislation and let them apply again. We made submissions and did some media around the new proposal. And we went to the latest planning hearing.

Of course, it was just a coincidence that the most controversial hearing of the year was held five days before Christmas.

One of our key points was that the Department of Planning and Environment had lied to the Planning Assessment Commission. The Department said that:

The Department has tested the sensitivity of [the mine’s economic assessment] to changes in key variables, such as the price of coal, and concluded that even if these variables change significantly over time, the benefits of the project would remain positive.

We asked to see the Department’s analysis and it admitted that it hadn’t actually done any. Instead, they took what Rio Tinto said in their economic assessment at face value.

We also brought up our more familiar arguments; that the benefits of the mine had been overstated and the costs to the long-suffering residents of Bulga and the local environment largely ignored.

The PAC’s recommendation on this will be in the news soon.

We were right on Cobbora…. again

Under disgraced former mining minister, Ian Macdonald, the NSW government entered the coal business – literally. NSW taxpayers own and subsidise the Cobbora Holding Company, the proponent of a large, low-quality coal mine near Dunedoo.

The mine’s economists claimed the project would have a benefit of $2 billion to the NSW community. TAI’s Rod Campbell has argued for years that the project is unviable, causes damage to agricultural industries and the local community and should be abandoned.

So we weren’t surprised to read in late December that the government is unable to find a buyer for the mine. Imagine that – no one wants to buy a mine that Treasury says will lose $1 billion!

It’s time the NSW government abandoned this project and helped the Dunedoo community get over the damage it has caused. Fortunately, lots of farmers are already getting on with the job.

 

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