'Last-ditch' pitch for valley's brown coal
Tom Arup, Royce Millar July 08, 2013
The Napthine government will try to drum up interest in the vast but carbon-intensive brown coal reserves of the Latrobe Valley through a direct sales pitch to big mining companies.
More than a year after it sought expressions of interest in opening up new coalfields in the valley, the government is turning to active promotion of 13 billion tonnes of unallocated brown coal, including to overseas companies.
''This coal resource has been spoken of for decades as being a clear competitive edge [for Victoria],'' said the Deputy Premier and State Development Minister, Peter Ryan. ''We intend to find out the reality of that. That is why we are casting the net as widely as we are and in the way that we are.''
But critics of new coal allocations see the cranked-up sales pitch as an acknowledgement of a dearth of significant commercial interest in brown coal.
''This appears to be a last-ditch bid for investment because to date no genuine players have come forward with viable proposals,'' said Environment Victoria campaigner Victoria McKenzie-McHarg. ''It is clear that the market doesn't want our dirty coal.''
Mr Ryan said the government would approach domestic and international companies it believed could be interested in a coal tender, to add to an undisclosed list of companies that have already come forward.
He refused to say how many companies would be approached or how many had already shown interest. But he said the government expected to hold about 100 follow-up meetings, after which it would decide whether a new coal tender would proceed.
The Coalition's move coincides with the completion of a study of opportunities for the Gippsland economy overseen by RMIT University political economist Professor Peter Fairbrother.
He said it was important the region played to its economic strengths by focusing on local resources, including coal, oil and gas, food and timber. But he cautioned against too great a reliance on coal after a slew of much-hyped clean-coal and new-energy projects had stalled. The report calls for much greater rail freight transport and the establishment of a regional commission with planning powers that would ensure stronger protection for the area's rich farmlands.
While accessible brown coal has provided Victorian households and industry with cheap electricity for almost a century, its long-term future as an energy source is in doubt because of its high greenhouse gas emissions, even compared with black coal.
The recent history of coal allocations has been chequered. In 2002, the Bracks Labor government granted three new licences to companies promising $8 billion in investment in new, low-emissions coal projects and thousands of regional jobs. None of the proposed projects proceeded.
In 2009 the Brumby government considered, but then abandoned, a plan for a special allocation to the Melbourne-based Exergen for plans to dry and export brown coal.
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