Adani full steam ahead

Galilee on track as Indians build rail

• ANDREW FRASER
• THE AUSTRALIAN
• JULY 18, 2014 12:00AM

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THE development of the massive coal deposits in Queensland’s Galilee Basin is continuing despite slumps in the world coal price, with Indian company Adani announcing that it will build a railway to transport coal to port in conjunction with Korean company Posco.
The deal — understood to involve about $2.2 billion worth of investment — involves the construction of a 388km railway line due east from the northern part of the Galilee Basin to the established coal area of the Bowen Basin, where the line would connect with existing railway infrastructure.
Another Indian company, GVK, is also proposing to build a rail line from the Galilee to the current network in partnership with former state-owned rail company Aurizon, but this line goes from GVK’s mines, which are mostly in the southern part of the Galilee Basin, while Adani’s coal reserves are in the north of the basin.
The Adani/Posco line is, like the GVK/Aurizon line, a standard gauge line, which means that the possibility of a large gauge track that can accommodate far bigger trains than the ones currently used will be lost.
The line will have a projected capacity of 60 million tonnes of coal a year, similar to the line being proposed by GVK/Aurizon.
Environmentalists claim these tonnages of export coal, largely to India and China, mean that the Galilee will become a “carbon bomb”, and they have strongly opposed the development.
Adani is owned by Indian billionaire Gautam Adani, who yesterday said: “The rail project will lead to the opening of the Carmichael mine project, which will deliver in excess of 10,000 jobs, and will also provide vital opportunities for Australian infrastructure development and contribute to energy security of India by lighting the lives of millions of Indians.”
Adani said work on the railway would commence at the start of next year. GVK, which has yet to set a date for construction of its proposed line, is claiming that its first shipments of coal from the Galilee Basin will commence in early 2017.
Both of these major projects have most of their government approvals, but GVK is still waiting to finalise its finance package before proceeding.
The other large player in the Galilee Basin is politician Clive Palmer, but his proposed project still awaits several government approvals.
Unlike the GVK and Adani projects, Mr Palmer’s proposal also lacks any way of getting the coal from his Galilee holdings to port, plus any port space.
Several other players have entered the Galilee, including South American giant Vale and Chinese company Meijin, trading in Australia as MacMines.
Adani’s contract is with Posco’s construction arm, Posco E&C.
Posco has been active in Australia for several years and recently signed a memorandum of understanding with ASX-listed company TNG over the Mount Peake vanadium project in the Northern Territory.
The Galilee Basin is about 200km west of the Bowen Basin.
It has plenty of coal it has remained undeveloped because the cost of transporting it to port.

http://www.theaustralian.com.au/bus...dians-build-rail/story-e6frg8zx-1226992729067