Glencore to build $1.5bn Queensland coal mine
Mining heavyweight Glencore plans to build a $1.5bn coal mine in Queensland’s Bowen Basin two years after buying the deposit.
Mining giant Glencore plans to build the $1.5bn Valeria coal mine in Queensland’s Bowen Basin two years after buying the undeveloped deposit from rival Rio Tinto.
The new open cut mine, a mix of thermal and metallurgical coal, could provide up to 2350 jobs and has been declared a co-ordinated project by Queensland’s independent Co-ordinator-General. It’s expected to produce up to 20m tonnes a year of coal over a 35-year period.
Glencore has decided to proceed with the mine despite announcing a year ago it would freeze production at current levels to help address climate change concerns following pressure from investors including major Australian superannuation funds for the fossil fuel to be phased out.
Any thermal coal produced by the new mine will be subject to Glencore’s output cap to support the “global transition to a low carbon economy”, Queensland Mines Minister Anthony Lynham said. Glencore noted the Valeria project would replace production from other operations as they neared the end of their mine lives including the Clermont mine which produced 11m tonnes of coal in 2018.
The Australasian Centre for Corporate Responsibility criticised the decision to proceed with the mine.
“Glencore is a key target of the Climate Action 100 initiative. Glencore’s Valeria coal mine plan is plainly inconsistent with the cap that CA100 investors negotiated last year, to much fanfare. Whether CA100 is able to stand up to this latest defiance is a huge test for the initiative,” ACCR director of climate and environment Dan Gocher said.
Glencore bought the Valeria and Hail Creek mines for $US1.7bn ($2.5bn) from Rio in March 2018.
For Glencore, the acquisition adds to its already major position in Queensland’s coal industry. It already owns a string of mines in the Bowen Basin, and produced more than 95m tonnes of thermal and coking coal across its Australian operations in 2018.
In addition to the Valeria and Hail Creek deals, it also paid $US1.26bn for a 49 per cent share of Rio’s Coal & Allied thermal coal operations in NSW’s Hunter Valley in 2017.
The undeveloped Valeria deposit, 27km northwest of Emerald in central Queensland, contains 762 million tonnes of coal resources.
The Swiss-based resources giant, headed by billionaire Ivan Glasenberg, says it will cap its global thermal and coking coal production at the current level of about 145 million tonnes after holding talks with the Climate Action 100+ initiative which controls $US32 trillion in global investment.
Glencore’s Australian mines account for nearly 100m tonnes of its global volumes, underlining the long-term impact the cap may have on major new mines being delivered in Queensland and NSW.
Climate Action 100+ members in Australia include AustralianSuper, AMP Capital, Cbus, IFM Investors, QSuper and BT Financial Group.
Draft terms of reference for the Valeria environmental impact statement will be prepared by the Co-ordinator-General with Glencore to prepare its own EIS including community consultation.
More Coverage
