The project, expected to cost $900 million and produce 15 million tonnes of coal a year, has already received environmental approval and the funds from the Federal Government’s NAIF would support the first stage development.
The NAIF mandate is broad but allows funding for projects which are commercially viable but require support primarily in the form of concessional finance to succeed, or have been unable to attract finance.
Minister for Resources, Water and Northern Australia Keith Pitt said the Pembroke Resources project would support up to 700 jobs during construction and more than 500 new jobs for the region when fully operational.
“NAIF has approved a loan of $175 million to support the mine’s first stage of development which includes rail, and transmission lines, water pipelines, access roads and a coal handling preparation plant,” Pitt said.
“Pembroke Resources’ Olive Downs project will create jobs and opportunities for central Queensland and the nearby town of Moranbah, and will generate royalties and export income for Queensland and Australia for many years to come.
“Metallurgical coal is crucial for steelmaking, and is an important commodity for Australia’s trading partners to help support their economic development.”
“The NAIF investment will be an important contribution to a project which is expected to return more than $10 billion to the Australian economy over the mine’s lifetime, and provide jobs for people in Moranbah, Dysart and Mackay.”
NAIF has approved $1.2 billion in loans to 11 projects in Queensland, supporting jobs across the state.
The Olive Downs mine will be the third largest in the state, producing up to 15 million tonnes a year.
Pembroke chief executive Barry Tudor said it was another important step in the development of the world class project and was great news for Queensland at a time when, outside of the industry, some commentators question why we need any new new steelmaking coal mines.
“The common argument against new steelmaking coal mines is that any new project will only exacerbate the existing emissions from steel production. This is an overly simplistic supposition, and the reality is vastly different,” Tudor said.
“While we expect an eventual move to new, more efficient/low emission steel making technologies, the reality is these are several decades away.
“A reduction of emissions from steel production can be achieved now. The worst 3 per cent of global steelmaking coal producers emit more Scope 1 and 2 CO2e than the lowest 35 per cent. Introducing low-cost, low-emitting steelmaking coals to the global market will displace the worst of these high-emitting producers. ”
Australian Conservation Foundation’s Suzanne Harter said that while investors around the world were getting out of fossil fuels, and Australia’s banks are becoming increasingly unwilling to finance coal projects due to their clear climate risks, the Morrison Government was using public money to support coal.
“It seems investment in Olive Downs would not hold up for other investors, yet the Minister and the NAIF board have decided it is an acceptable use of public money,” she said.
“Recent amendments to the NAIF Act intentionally gave the federal resources and finance ministers greater powers to direct NAIF investments.
“It is deeply irresponsible to use public money to support a coal project in 2021 – flying in the face of overwhelming advice by scientists and even the International Energy Agency that a global pathway to net zero pollution by mid-century cannot include new coal or gas.”Jump to next article