Glencore pulls out of Valeria Coal mine project near Emerald

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

Glencore’s Valeria Coal Project was to be situated near Emerald in the Bowen Basin.

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 map of the proposed Valeria coal mine. Picture: Glencore

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.

“Japan’s Ambassador to Australia Yamagami Shingo has also made it clear the relationship between Queensland and Japan has been damaged by the way in which the royalties were unilaterally introduced, without any consultation with industry or investors.

“Sudden changes in the rules for investment discourage investors from future job-creating projects, which should be a major concern for any government.”

Environmental Advocacy in Central Queensland director Coral Rowston said the news of the mine no longer going ahead was “terrific”.

“This is terrific news for the local CQ community, as well as the koalas, forests and wetlands that Glencore wanted to destroy just so it could mine more coal,” she said.

“The world is at a tipping point and we cannot continue ripping up important waterways, natural areas, and farmland for projects that will drive the climate crisis into overdrive.

“Queenslanders are asking for support to diversify our regional economies and take advantage of new opportunities in clean energy and agriculture - that’s the future we want and need now.”

Lock the Gate Alliance national coordinator Carmel Flint said the withdrawal of the project was very significant and highlighted there was no future in coal.

“This shift by Glencore, and its statement that it was part of its managed design of its global coal business, is a massive signal that thermal coal is on the way out around the world,” she said.

“There are seismic shifts occurring around the globe as the race to decarbonize accelerates, and even commodity giants like Glencore are not immune.

“This is a big relief for Australian communities - those who would have been directly impacted by a polluting coal mine and those who would have to fight for their lives against the fires and floods it would have contributed too.

“The world is rapidly moving towards clean green energy. Sadly, Glencore still doesn’t seem to fully understand this though, with suggestions it wants to build a new project producing hydrogen from coal seam gas near Wandoan.

“Glencore either needs to embrace the renewable energy revolution, or it will swiftly be left behind by other operators who understand there is no future for fossil fuels.”

Resources Minister Scott Stewart and Treasurer Cameron Dick have been contacted for comment.