Coal export plan makes progress

Bulk handling and haulage company Qube Logistics is reportedly close to signing a contract to transport more than a million tonnes of Collie coal to the Bunbury port.

The contract would be signed with Griffin Coal’s owner, Indian energy giant Lanco Infratech, and would see up to 1.25 million tonnes coal a year carried for export.

In a recent Supreme Court hearing, a Griffin financial officer reported the contract could be implemented early this year – potentially as soon as April.

The contract, as well as the resigned supply agreement with Bluewaters power station, would put the heavily indebted Griffin mine in the black by the end of year.

Lanco bought the mine in late 2010 for $750,000 and has since been trying to slash debt while launching expansion and export plans.

The mine currently produces about 3.75 million tonnes of coal a year, primarily for the domestic market, but hopes to bump up production to 5.2 million tonnes.

The contract would be a significant step forward in Lanco’s plans to make the Bunbury Port its exportsgateway for up to 15 million tonnes of coal per year.

As part of Lanco’s plans to expand its Griffin operations and exports, the company wants to initially use a mobile container loading system provided by Qube.

Lanco’s eventual hope is to have 1km-long trains carry coal to new storage and loading facilities at a berth at the port.

The expansion would include a capital investment in Collie and Bunbury of between $800 million and $1 billion, including up to $250 million in upgrading the rail link.

A company spokesman told the Times the expansion would create hundreds of jobs in the South West. Lanco is pushing ahead with the plans, despite the looming $3.4 billion court case with Perdaman Chemicals and Fertilisers.

Perdaman is suing Lanco.

The company claims the Lanco reneged on a coal supply agreement.

The case, which was first launched in June 2011, is expected to go to court later this year.

Perdaman claims Lanco, by backing out of the coal supply agreement, ruined its chances of securing finance for its proposed $3.5 billion urea plant which was planned for Shotts Park in Collie.

Lanco’s plans for Berth 14A at the Bunbury port can be viewed online at www.griffincoal.com.au.

Lanco declined to comment and Qube did not respond to an interview request before going to press.