India, China acquire coal assets in Queensland
Almost all the coal in Australia's next major coalmining area, the Galilee Basin in central Queensland, has already been sold to Indian or Chinese interests, three years before mining is due to start, Theaustralian reports.
Hancock Coal has announced it would be selling 79 per cent of its interests in the proposed Alpha coalmine in the Galilee Basin, 100 per cent of another mine, Kevin's Corner, and rail and port infrastructure to Indian company GVK Coal for $1.2 billion.
Figures obtained by The Australian show that the five major projects proposed for the Galilee Basin have reported resources of 20.5 billion tonnes, of which all but 1.2 billion tonnes has already been contracted to Indian or Chinese companies.
The GVK Coal purchase consists of three mines with 7.9 billion tonnes, as measured under the industry's Joint Ore Reserve Committee (JORC) standard. This is only slightly more than the Carmichael project bought by India's Adani (7.8 billion tonnes).
These two Indian buyers account for roughly 80 per cent of the available coal in the Galilee Basin, with Clive Palmer's Waratah Coal project currently having a listed resource of 3.7 million tonnes.
Mr Palmer aimed to develop his holdings through a listing of his company, ResourceHouse, on the Hong Kong Stock Exchange, but when this failed, the Chinese government's EximBank increased its contribution from $5.6bn to $6.8bn while Chinese state-owned enterprises would put in a further $600 million. Mr Palmer claims the entire output of the mine will go to China in a deal worth $60bn over 20 years.
While there are still several Australian companies with small holdings in the Galilee Basin, the only Australian company with any interest is Bandanna Energy, which in partnership with US company AMCI has the Galilee South resource of 1.2 billion tonnes.
GVK, has coal-fired power stations in India which need a reliable supply of coal. GVK is planning a vertically-integrated operation similar to that of Adani, which owns not only the mine, but also the railway line taking the coal to the port and the port itself.
While Hancock has yet to build the 500km railway necessary to take the coal from the Galilee Basin to the coal port of Abbot Point, the deal with GVK allows the Indian company to take over Hancock's interests in these two pieces of infrastructure.
Hancock has already been allocated space at the expansion of Abbot Point to handle its coal exports, and the corridor on which the company plans to run a railway line is the subject of an Environmental Impact Study.
The project still needs approval from the Foreign Investment Review Board as well as a various state and federal government environment approvals, but GVK is hoping to get these and build the necessary infrastructure so coal exports can start from 2014.
GVK is controlled by Indian billionaire GV Krishna Reddy who earlier this year hosted a $20m wedding of his granddaughter in India.
Hancock Coal head Gina Rinehart attended the wedding along with federal Coalition members Julie Bishop, Barnaby Joyce and Teresa Gambaro.
Senator Joyce, a vigorous opponent of excessive foreign ownership of Australian assets, said he wouldn't comment on individual cases but that he would have preferred Hancock to develop the resources itself. "But I support spreading the risk away from China and developing our relations with India," he said.
Hancock Coal has announced it would be selling 79 per cent of its interests in the proposed Alpha coalmine in the Galilee Basin, 100 per cent of another mine, Kevin's Corner, and rail and port infrastructure to Indian company GVK Coal for $1.2 billion.
Figures obtained by The Australian show that the five major projects proposed for the Galilee Basin have reported resources of 20.5 billion tonnes, of which all but 1.2 billion tonnes has already been contracted to Indian or Chinese companies.
The GVK Coal purchase consists of three mines with 7.9 billion tonnes, as measured under the industry's Joint Ore Reserve Committee (JORC) standard. This is only slightly more than the Carmichael project bought by India's Adani (7.8 billion tonnes).
These two Indian buyers account for roughly 80 per cent of the available coal in the Galilee Basin, with Clive Palmer's Waratah Coal project currently having a listed resource of 3.7 million tonnes.
Mr Palmer aimed to develop his holdings through a listing of his company, ResourceHouse, on the Hong Kong Stock Exchange, but when this failed, the Chinese government's EximBank increased its contribution from $5.6bn to $6.8bn while Chinese state-owned enterprises would put in a further $600 million. Mr Palmer claims the entire output of the mine will go to China in a deal worth $60bn over 20 years.
While there are still several Australian companies with small holdings in the Galilee Basin, the only Australian company with any interest is Bandanna Energy, which in partnership with US company AMCI has the Galilee South resource of 1.2 billion tonnes.
GVK, has coal-fired power stations in India which need a reliable supply of coal. GVK is planning a vertically-integrated operation similar to that of Adani, which owns not only the mine, but also the railway line taking the coal to the port and the port itself.
While Hancock has yet to build the 500km railway necessary to take the coal from the Galilee Basin to the coal port of Abbot Point, the deal with GVK allows the Indian company to take over Hancock's interests in these two pieces of infrastructure.
Hancock has already been allocated space at the expansion of Abbot Point to handle its coal exports, and the corridor on which the company plans to run a railway line is the subject of an Environmental Impact Study.
The project still needs approval from the Foreign Investment Review Board as well as a various state and federal government environment approvals, but GVK is hoping to get these and build the necessary infrastructure so coal exports can start from 2014.
GVK is controlled by Indian billionaire GV Krishna Reddy who earlier this year hosted a $20m wedding of his granddaughter in India.
Hancock Coal head Gina Rinehart attended the wedding along with federal Coalition members Julie Bishop, Barnaby Joyce and Teresa Gambaro.
Senator Joyce, a vigorous opponent of excessive foreign ownership of Australian assets, said he wouldn't comment on individual cases but that he would have preferred Hancock to develop the resources itself. "But I support spreading the risk away from China and developing our relations with India," he said.