GVK clears key hurdle for Aus coal project but troubles remain

Melbourne: GVK Power & Infrastructure has cleared a key hurdle toward developing its A$6.4 billion Alpha coal project, winning state environmental approval for what would be one of Australia’s biggest coal mines.

GVK’s Alpha project has made the most progress towards development approval among several in the untapped Galilee Basin in Queensland, where rival Indian group Adani Enterprises is planning a A$10.9 billion coal and rail project.

[caption id=“attachment_324301” align=“alignleft” width=“380” caption=“Construction is expected to run from 2013 to 2016. Reuters”]  [/caption]

The Alpha project is being run by Hancock Coal, 79 percent owned by GVK and 21 percent owned by Asia’s richest woman, Gina Rinehart, who sparked a political storm last week when she won the right to hire foreign workers to build an iron ore mine.

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The Queensland coal project still needs environmental approval from the government in Canberra and a mining lease from the state to go ahead.

The Galilee Basin projects have been slow to win approvals, facing opposition from environmentalists concerned about coal burning, port dredging and ship traffic along the fragile Great Barrier Reef, as well as from landowners along the proposed rail route.

“We don’t think GVK knew what they were getting into when they bought a majority stake in this mine,” Greenpeace senior campaigner John Hepburn said in a statement, vowing to continue fighting against the mine.

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The approval from Queensland’s coordinator-general sets out 128 conditions for managing environmental impacts from building the 30 million tonnes-a-year thermal coal mine and a 495 km (310 mile) rail line from the mine to the port of Abbot Point.

“It’s another step towards getting a mining lease and final approvals,” Hancock Coal’s spokesman Chris Bombolas said.

Hancock Coal is looking to sell down its stakes in the Alpha coal project and related port and rail assets to help fund the A$10 billion cost of the projects, with interest seen from Asian coal buyers, Chief Executive Paul Mulder told Reuters in March.

“There’ll be an estimated A$11 billion boost to the economy during the mine’s three year construction phase,” Queensland deputy premier Jeff Seeney said in a statement.

Construction is expected to run from 2013 to 2016, he said.

Reuters