Mining output down under water

From the 13th floor of office of the Queensland Resources Council visitors get a clear view of the Brisbane River flowing serenely. For someone on a short trip to the city of Brisbane in Queensland, the only indication of the havoc it caused recently when it overflowed its banks a few weeks ago are the news reports in local dailies and national papers.

Life in the city may appear to have gone back to the routine. But the same cannot be said of Queensland's one of largest contributor to the economy — the mining sector.

Mining has taken a big hit and the Queensland Resources Council's chief economist, Mr David Rynne, declines to comment on when life in mining would return to normal — We are “still in the wet season,” he points out.

‘significant restrictions'

There are two-three months to go, says David Rynne. The council estimates that of the 57 coal mines in Queensland just about 15 per cent are in full production. There are ‘significant restrictions' in more than 80 per cent of the mines. With rail lines to the ports damaged, both production and supply have been hit.

Output from its mines could be down 30 per cent on the estimated production of about 204 million tonnes in 2010-11. As of now, the council hopes coal output would be about 174 million tonnes for the year but with the possibility of more rains in the coming months supply could drop further to about 150 million tonnes, he tells a group of journalists visiting Brisbane as a part of a tour organised by the Department of Foreign Affairs and Trade, a Australian Government agency.

According to council estimates, as of now, over $5 billion is being lost in production and about $1.6 million a day loss in royalty income to the Government. If the situation worsens, the losses could mount to $9 billion and about 2.9 million a day in lost royalties.

Of immediate concern to the council, which represents the interests of the mining sector and counts among its members over 190 companies in mining and related areas, is the need to pump out the flooded mines and resume operations. Australia as one of the largest suppliers of coal to the industries globally, and Queensland accounting for a major share, means the calamity in the Outback has a worldwide impact. But there are deeper concerns. The polluted water from the mines would flow into the Fitzroy River which empties into the Pacific. This would have an effect not just on the river but also the Great Barrier Reef, a unique ecosystem. Pacific.

Emerging direction

The mining companies have applied for TEPs (Transitional Environmental Programme) for about 40 mines, which for the mines is effectively a relaxation of the rules governing effluent discharge under the environment legislations. The regulator needs to “cut us a bit of slack,” says Mr Rynne.

The industry is urging the Government to use its emergency direction to allow the pumping apart from putting in place a long-term plan to deal with such emergencies.

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