Amid widespread opposition against coal use particularly for thermal coal-fired electricity generation, the Queensland government has fast-tracked Glencore’s Valeria coal project in the Bowen basin in Queensland.
The $1 billionValeria mine is expected to produce a mix of up to 20 million tonnes per annum of metallurgical coal that is used for the production of steel and also thermal coal for power generation over a 35-year mine life. However, the exact mix has not been specified.
Contribution to economy
The minehas been designated as a coordinated project with the state government stating that this new mine would potentially create hundreds of new jobs in Queensland, which in turn would help in the post-apocalyptic recovery from the unprecedented shock of the coronavirus pandemic.
Last year, Glencore’s coal operations contributed over AUS$ 4 billion to the Queensland economy, including ongoing investment in existing mines, payment of royalties, community programmes and spend on goods and services from predominantly regional Queensland suppliers.
The market reports suggest that the Valeria project – comprising of both thermal and metallurgical coal – could support up to 1400 construction jobs and 950 full-time operational jobs over a 35-year mine life.
Cap on thermal coal output
The Valeria Coal project will replace production from other Glencore coal operations as they reach the end of their mine lives, including the Clermont coal mine, and will be managed in line with Glencore’s global climate change commitments, the company has added.
Further it has mentioned that any thermal coal produced by the new mine will be subject to the company’s cap on thermal coal output, to support global transition to a low carbon economy.
Glencore had moved to cap its global coking and thermal coal output at about 145mn t per annum in Feb’19 in response to increasing pressure from its shareholders to take action to address climate change.In 2019, the miner produced a total of 139.5mn t of coal, including 123.9mn t of thermal coal, up from 129.4 mn t in 2018.
Miners exiting from coal business
Mining major Anglo American is limiting its coal production and has reduced its 2021 thermal coal target from 30 mn t to 26 mn t in Dec’19.
Rio Tinto, another leading miner, has entirely wrapped up its coal business in Australia, after selling its Queensland-based assets in Aug’18. This include the sale of its interests in the proposed Valeria coal mine to Glencore.
In Jul’19, BHP was reported to be exploring options to shut its remaining thermal coal mines in Colombia and Australia. In Mar’20 the company placed its Cerrejón mine in Colombia on care and maintenance following governmental protocol to contain the spread of Covid-19, while production in New South Wales fell 13% to 11 mn t as a result of shift in focus to higher quality products.
Leave a Reply