Valley boom prediction

THE next decade could see the Latrobe Valley face the same boom conditions as Australia’s northern states if current State Government coal allocation plans for the region are embraced by the market.

That was the message from government and mining sources this week after a leaked State Government cabinet submission forced State Energy Minister Michael O’Brien to confirm the government’s plan to proceed with a coal allocation strategy for the Valley’s vast brown coal resource.

Mr O’Brien told The Express this week the government was confident “a strong level of interest” from numerous companies wanting access to this area’s coal would be confirmed in an expression of interest process to commence within the next two months.

A report in The Age claimed companies including coal technology firms Exergen and Australian Energy Company Limited would seek up to one billion tonne of coal each for potential export to Asia, among other uses.

This month Federal Resources and Energy Minister Martin Ferguson also told The Express he had high level talks with companies including Exergen about their desired stake of the Valley’s coal.

The State Government’s EOI process would take around six weeks to complete and a full tender process should be underway by the end of this year, Mr O’Brien said.

While the Minerals Council of Australia Victorian division executive director Megan Davison estimated approvals and feasibility processes could then take a further three to four years, Mr O’Brien said those timeframes would vary according to the intended uses of the coal.

According to Department of Primary Industries figures, 13 billion tonne of Latrobe Valley’s economically-viable coal has yet to be allocated.

Mr O’Brien said the government had not yet decided on the size of future allocations, adding “the factors that go into that decision will be based on what (projects) offer us the best development potential”.

Proposals are expected to include processing and drying the coal in the Valley for a range of cleaner uses of the resource, and potential export on a large scale to Asian countries including China, India and Japan where demand is, according to the government, high.

Ms Davison said future use of the Valley’s “massive resource” could see this region enjoy “the same levels of (economic) activity, and potentially capture some of the market share, of what is currently being shared by the northern states”.

Though major and costly infrastructure works would need to accompany any large-scale export of the Valley’s coal – not the least of which would be a deep water port – Ms Davison said it was conceivable public/ private partnerships,