(EnergyAsia, September 3 2012, Monday) — India’s GVK Power and Infrastructure said it has been given environmental approval by the Australian government to proceed with its A$10 billion Alpha coal and rail project in Queensland state. (US$1=A$0.98).
The approval for what will be the first project to tap the Galilee Basin came with 19 conditions to protect an environmentally fragile area with a direct impact on the Great Barrier Reef. The UN has stated its concern that the Australian government has done enough to protect the reef from resource-development works in Queensland state.
GVK holds a 79% stake in the Alpha Coal and Alpha West projects and the entire stake in the Kevin’s Corner project in Queensland state.
Acquired from Hancock Prospecting Pty Ltd, these projects hold a total of eight billion tonnes of coal with a peak production capacity of 80 million tonnes per year, making them among the largest coal mining operations in the world.
According to GVK, Alpha has a mine life of more than 30 years and an annual production capacity of 32 million tonnes.
To support the mines, GVK fully acquired the 500-km rail line and a 60 million tonne/year port as part of the “pit-to-port” logistics solution. The Queensland state government has selected GVK’s rail network as the north-south corridor to connect the Galilee Basin to the Port of Abbot Point.
GVK said it aims to export the mines’ superior quality low ash, low sulphur and low gas thermal coal to customers in Asia from 2015. Construction is expected to start next year.
GVK vice-chairman G.V. Sanjay Reddy said: “This is another important milestone for our project which will provide significant benefits to the Alpha and Bowen regions, the state and the country. The projects we are planning will provide 2,000 on-going jobs in operations, directly employ around 4,000 during construction and return to government A$1.5 billion annually in royalties and taxes at peak production.
“This positive decision also paves the way to ensure more than 1.4 billion people (largely in Asia) that face a major shortage of electricity, are provided with an additional source of coal to enhance supply of electricity to the region, thus improving quality of life of the people and overall economic development.”
With Alpha’s approval, environmentalists fear that several other mining projects in the Galilee Basin could follow. Another Indian group, Adani Enterprises, is also planning to invest A$10.9 billion to build its own coal mining and rail project.
Greenpeace has criticised the mine’s approval announced by Federal Environment Minister Tony Burke.
The environmental lobby group, which plans to protest the project, said Alpha “marks the beginning of opening up the Galilee Basin to enormous coal developments” and “accelerates the industrialisation of the Great Barrier Reef.”
“The Alpha development is an environmental disaster, threatening our Reef, our climate and wildlife in the mining area.”
Greenpeace said coal from the Alpha mine will be exported through the Reef, leading to hundreds more coal ships and the construction of a huge new port facility within the World Heritage Area.
In June, the UN’s World Heritage Committee passed a strongly worded decision requesting Australia not to allow any development that could impact on the outstanding universal values of the Great Barrier Reef.
Greenpeace said Mr Burke has rejected the warning from The World Heritage Committee.