New Acland mine closure impacts to freight on West Moreton rail line
THE continued delay on a decision around the New Acland Stage 3 expansion mining lease has severe ramifications for jobs, agriculture, nearby mines and the cost to use the rail line on the Darling Downs.
Toowoomba and Surat Basin Enterprise executive chairman Shane Charles said the New Acland mine, that began operation in October 2002, brought with it a significant boost to the Oakey and wider region.
Without the expansion approvals, the mine will cease operations by 2018 and would start winding back operations before then.
The expansion is worth $900 million and would extend the life of the mine until 2029.
The latest in a long line of hurdles for the mine is the Environmental Protection (Underground Water Management) and Other Legislation Amendment Bill 2016 (Qld) which essentially means that if passed, the approval for the mine will be delayed for a number of years, affecting its viability.
It’s not just coal that is impacted. The West Moreton Rail System would face huge impacts if the mine was to close, with New Acland contributing about 65 percent of all freight traffic on the line.
In June this year the Queensland Competition Authority Decision showed Queensland Rail’s average annual revenue from coal services over the four years from July 1, 2017 was $54 million a year.
Of that, New Acland would provide about $39m of the revenue each year (at 5mtpa at $7.84/t).
Bulk grain and cotton is the only other unsubsidised cargo that uses the West Moreton System.
If the site was to close, QR would lose the $39m a year of revenue, but save about $9m in costs related to maintenance and other variable costs, representing a net loss of $30m a year.
New Hope Group does not consider it a viable option to continue to operate its West Moreton mine if New Acland closed.
The closure of West Moreton would lead to a further loss for QR of $1.7m per annum (700,000t at $2.46/t), bringing QR’s loss to about $32m.
With 5.7 million tonnes a year of coal tonnages lost, Cameby Downs mine would face high unit costs at the coal terminal (Port of Brisbane), and in rail haulage due to a lack of scale.
For QR to maintain the line at current costs, Cameby Downs would have to pay increased charges to cover QR’s loss of revenue.
Mr Charles said New Acland mine workers were not fly-in fly-out, but residents in the region.
“They are Toowoomba and Oakey-based residents that spend their money here. They’re families raising their children here and building their futures,” Mr Charles said.
“Oakey would be economically devastated by the loss of workers coming through the town, at a time where the area is trying to rebuild its image and welcome business.”
“Employees shouldn’t have to feel their jobs could go at any minute because the government won’t decide on the mine’s future.”
For the period October 15 – September 16, the Port of Brisbane recorded 461,000 tonnes of chickpeas, wheat and barley was transported in bulk through the site.
This is equivalent to around 22,000 truck movements.
“Again, if New Hope were to leave the system, the ability of agricultural product to secure spots on rail at competitive rates (without serious increase in subsidies) is in jeopardy. The reality of 22,000 truck movements is also unpalatable.”
Should all this eventuate, the impact goes wider again.
“Jobs, estimated at 75 train crew from Aurizon would be likely to go, with limited opportunity to be redeployed,” he said.
“Jobs in the Toowoomba maintenance Depot would also be at risk without the work maintaining the carriages.”
This approval process has been ongoing for more than eight years after the project dimensions were changed and approval was granted by the Newman government.
