7 Feb 2010

Australia signs huge coal deal with China

1:33 pm on 7 February 2010

An Australian company has signed a $A69 billion deal to supply millions of tonnes of coal to China, in what's believed to be Australia's largest export contract.

Under the deal, Queensland billionaire Clive Palmer's company Resourcehouse will build a new mining complex to give China Power International Development (CPI) 30 million tonnes of coal a year for 20 years.

Queensland premier Anna Bligh said it was Australia's largest ever export deal.

The plan involves building a huge new mining complex in Queensland and laying 500km of railway line to move the coal to the coast.

Mr Palmer told the ABC the 40 million-tonne-a-year thermal coal mine in the Galilee Basin, near Alpha, west of Emerald would be the "biggest coal mine in the world".

Four underground mines and two open cast mines will be developed, the ABC said, as well as a new coal port at Abbot Point, near Bowen.

Mr Palmer said he had awarded the $A8 billion contract to build and develop the mine to China's Metallurgical Corporation (MCC).

Construction was likely to begin later this year and the mine was expected to be fully operational by 2014.

Mr Palmer said 7000 jobs would be created during construction and operation.

The deal will almost certainly disappoint some environmental groups, the BBC reports. The groups believe Australia's reliance on plentiful reserves of coal, both for domestic electricity generation and for export, should be reduced in favour of renewable sources of energy.