2600 coal jobs crushed: Mining giant scraps $1.5bn Valeria project

The Morning Bulletin, Rockhampton

Journalist: Geordi Offord

Thousands of coal mining jobs have been crushed with news Glencore will no longer be proceeding with its major Valeria Coal mine project.

The $1.5 billion project, which was meant to be built north of Emerald, was touted to create more than 1400 jobs during construction with a further 1250 during operation.

Construction on the mine was expected to commence in 2024.

The project was expected to produce 16 million tonnes of coal per annum for a period of about 37 years.

In a statement, Glencore said the Valeria coal mine project would be placed “under review”.

“This decision has been made in the current context of increased global uncertainty and is consistent with Glencore’s commitment to a responsibly managed decline of our global coal business and our ambition of being a net zero total emissions business by 2050,” the statement said.

“We will continue to progress various brownfield coal extensions as existing mines in Australia, but note that within the next four years Liddell, Newlands and Integra mines will close an undergo appropriate rehabilitation.”

The project withdrawal comes just a day after Queensland Treasurer Cameron Dick handed down the mid-year budget update.

The update revealed the government had turned around what was meant to be a $1.029bn deficit and is now set to post a $5.18bn surplus for 2022-23.

Much of the extra money is coming from a huge uplift in coal royalties, with the state’s new royalty tiers set to rake in four times as much money as was initially anticipated in 2022-23.

A spokesperson for mining giant Glencore said “genuine and timely” consultation with companies on the detail of policy reforms was crucial to avoid “continued uncertainty”.

“Abrupt decisions like the Queensland super royalty hike have damaged investor confidence, increased uncertainty and raised a red flag with key trading partners,” the spokesperson said.

“Governments are already benefiting from higher royalty and corporate tax revenue from the Australian coal sector.

“Glencore will be among the largest corporate tax and royalty payers in Australia for the 2022 financial year.”

A spokesperson for Treasurer Cameron Dick said with the company planning to exit thermal coal, it wouldn’t be expected for them to open new mines.

“Glencore have made it clear they are exiting thermal coal, so you would not expect them to open new thermal coal mines,” the spokesperson said.

Federal MP for Dawson Andrew Wilcox said one of the biggest “tragedies” of the decision to pull the project was the loss of job opportunities.

“Regions like ours are built on these jobs. They bring so much local investment and boost our local economy,” he said.

“Mining companies are used to the boom & bust cycle. So in good times like these, they use profits for further exploration, upgrade their mining equipment and rehabilitate previous mines sites which creates job opportunities within our region.

“Instead, the coal royalties hike squashes further development, which will affect our region when coal prices reduce”.

Mr Willcox criticised the Labor State Government for making decisions that impede regional communities.

Queensland Resources Council chief executive Ian MacFarlane said Glencore had made it clear State Government’s royalty hike was a factor in their decision to pull the plug on the huge project.

“Companies take into account a broad range of factors when considering multi-decade, large-scale investments in projects like this, and regulatory stability is one of those factors,” he said.

“Glencore has commented that ‘abrupt decisions like the Queensland super royalty hike have damaged investor confidence, increased uncertainty and raised a red flag with key trading partners’, which is consistent with the QRC’s position from day one – this royalty hike will affect long-term investment in this state. ”

Mr Macfarlane said the QRC’s warnings to the government on coal royalties had “fallen on deaf ears”.

“We now have a situation where major mining companies such as BHP, Peabody and Glencore are rethinking their investment plans for Queensland, which means every Queenslander loses out in terms of new jobs and business opportunities and the flow-on benefits from that,” he said.