Southern Missing Link’s path to progress not an easy one

By Jennifer Perry

Five of the Basin’s 16 coal mines need to come on stream and sign up for take or pay contracts in order for the rail project to reach financial close by 2010, as mandated by the Queensland Government. The contracts will fund 70 per cent of the rail project with the remaining 30 per cent funded by shareholder investment.
Two mines have already opened, with others either in the process of opening or still finalising exploration.
“Coal mines would happily go into debt for the whole cost of a mine a year ago - now no one is prepared to do that,” Compton said.
“They are all being very cautious about how to proceed knowing the world isn’t in good shape and the coal price having dropped.
“SBR has to take a punt that the coal mines will indeed open and the coal companies have to make the punt that the railway will open - we have to work together to minimise the risks and ensure the project continues to move forward.”
With construction completion mandated for 2013, the open-access rail link, also known as the ‘Southern Missing Link’, will see 210 kilometres of new railway connecting the Western Railway System (near Wandoan, 230 kilometres northwest of Toowoomba) with the Moura Railway System (located 130 kilometres west of Gladstone) at a cost of around $1billion dollars.
SBR, the joint venture charged with investigating the development of the railway is a consortium including Queensland Rail (QR), Xstrata Coal and the Australian Transport and Energy Corridor Limited (ATEC).
Compton said SBR has been working on their EIS for a long time but have not received any “significant opposition”. The 33 submissions received were from respondents including landowners and community groups and Compton said that all objections to the railway have now been met and the appropriate changes made.
“We personally met with everyone and have had no major problems - the EIS is not going to hold us up at all,” he said.
SBR made a submission to Infrastructure Australia (IA), though no request for a specific amount of funding was made.
“Our submission was on behalf of the whole inland railway - Surat is one of six segments of the inland railway from Melbourne to Darwin - and the next step after Surat’s rail is to link Moree and Toowoomba,” Compton said.
“It’s a long process going through and meeting all of IA’s criteria but we’ve been having constructive meetings with IA and are happy how they’re treating us.
“We haven’t reached the process with IA where they are able to recommend us for Federal funding though we’ll get into a budget sometime ahead, I have no doubt about that.”
Commenting on the Government’s Carbon Pollution Reduction Scheme (CPRS), Compton said the ETS will certainly not do the coal industry any favours.
“Why the Government would want to cripple Australia’s main source of income and harm coal companies is beyond my comprehension,” he said.
“By the same token, I can assure you that our railway and every single coal mine in the basin are willing to cooperate with Government to make sure we make steady progress towards clean coal and improve the situation.
“But the companies are not happy to cooperate with a Government who whacks on a tax just to keep the green lobby and media happy.”

For more information on the Surat Basin Rail project visit: www.suratbasinrail.com.au