Image: Jorunn Lorenzen.
BY ELIZABETH FABRI
THE regional centre of Emerald is back on its feet, with a fresh round of coal projects crying out for workers and creating economic impetus for the Central Highlands. New infrastructure investments are also cementing the town’s future as a long-term services hub.
Japanese-owned Sojitz Corporation has been instrumental in Emerald’s revival as a mining services town.
Sojitz, which has operated Minerva coal mine since 2010, began first production at its Meteor Downs project (jointly owned with U&D Mining) earlier this year, which required an additional 40 employees.
Then in June Sojitz made the big announcement it would purchase BHP Billiton Mitsubishi Alliance’s (BMA) shuttered Gregory Crinum metallurgical coal mine for $100 million, with the intention of reopening it as soon as possible.
Gregory Crinum, 60km north of Emerald, had been out of action since January 2016, and on and off the market since 2013.
Until recently BMA struggled to secure a buyer, but the time was now ripe for Sojitz as it looked to rebalance its coal assets which were currently weighted towards thermal coal.
“Our company was very keen on trying to move more into metallurgical coal (steel generation more so than thermal coal),” Sojitz managing director and chief executive Cameron Vorias told The Australian Mining Review.
“We also wanted to establish another mining operation in and around Emerald. It was where our existing workforce is based right now.”
But Sojitz’ had even bigger plans for the Gregory Crinum site.
The miner was currently planning to build a large solar farm on site (up to 100MW) that would power processing operations, and also be utilised by other mining projects and the wider community.
Sojitz was also currently engaged in talks with Futura Resources to combine its Wilton-Fairhill open cut mine, 10km away, with Gregory Crinum.
The idea will be to feed Wilton-Fairhill coal into the Gregory Crinum plant next year; a win-win for both companies.
“We have Heads of Agreements in place, but we are still talking about final agreements of mining of that resource to come into Gregory Crinum,” Mr Vorias said.
“We’re using Gregory Crinum as an infrastructure hub.”
A reopening will benefit Emerald; on the jobs front, more than 300 positions will need to be filled at Gregrory Crinum, and more than 100 at Wilton-Fairhill.
Mr Vorias said the Gregory Crinum acquisition was expected to close by December, with work to begin on site immediately once the green light is given.
The goal is to mine about 3 million tonnes per annum across a 20 year mine life, with first coal expected in February or March next year.
Workers at Minerva and Meteor Downs would be given priority employment, as would Emerald locals, Mr Vorias said.
“We would prefer a residential workforce to rebuild Emerald to where it was,” he said.
“Emerald went through a fairly bad period when Gregory Crinum first shutdown during the downturn, so it will be a very good thing for the Emerald township to have the two mines restart back up.
“There will be some people that will come out of the rest of the industry and there’s bound to be some clean skins (people without any skills) that we will bring into the organisation as well.
“But the emphasis will be on our own people and those based out of Emerald.”
Central Highlands Development Commission (CHDC) regional development officer Cat Spalding said the three projects delivered a wave of good news for Emerald, with sheer visibility of Meteor Downs alone causing a buzz.
“Its positioned down Rolleston near the highway, so people can see those developments, and hear that talk,” Ms Spalding said.
“Sentiment is definitely up, there’s a lot of optimism going on in the community.”
The QLD’s Government’s newly introduced FIFO laws also provided surety for locals.
“It certainly was a win for us,” Ms Spalding said.
“As Council said back when the laws passed, we respect the right for workers to choose where they want to live and where they want to work, however FIFO does impact social communities, and the vibrancy of regional communities.
“We think our regions are really great places to live; we want people to work here, the career opportunities are strong, the liveability is fantastic, so we strongly encourage permanent residencies.
“Moreover, we know our workers are skilled, we know our workers have the experience, so mining companies benefit.”
Further ahead, Emerald was also set to benefit from the opening of Shenhuo International Group’s Taroborah Coal project, a possible development of Glencore’s (formerly Rio Tinto) newly acquired Valeria project, and Adani’s proposed Carmichael project, currently obtaining finance.
With coal mining firmly back on the radar for Emerald, the Council and industry had been busy advancing infrastructure and amenities.
In the wider Central Highlands region, more than $7 billion of investment was happening across the resources industry, community infrastructure, industrial developments and residential construction.
One of the biggest enablers was the Central Queensland Intermodal Terminal and Industrial Access Road in the Yamala Enterprise Area, 25km from Emerald.
The new infrastructure will allow exports to be containerised regionally, rather than being transhipped elsewhere for containerisation.
Ms Spalding said the inland corridor project was going to be “absolutely transformational” for the region, connecting all of its industries, including mining and agriculture.
The Emerald airport will also benefit from Federal funding, with $1.4 million announced towards upgrades, including widening the airstrip.
“We’ve also got some regeneration work down at the Fairbairn Dam and water is absolutely critical for our region across all of our industries,” Ms Spalding said.
Despite improvements, challenges were still ahead for Emerald.
“Our problem is that we have really low unemployment; which is a great problem to have but a problem nonetheless,” Ms Spalding said.
“We know that businesses are having trouble getting in skilled tradespeople, we know they’re having difficulty attracting admin staff (those highly coveted roles that are critical for growth and enabling in the region) so that’s something we’re trying to address to bring in those types of people into the region.”
Mr Vorias agreed and said access to skilled labour would be “an ongoing challenge”.
“Having lost about 15,000 people during the mining downturn, [the industry] is struggling to get people back again now,” Mr Vorias said.
“I think the opportunities to train new people into the industry, we need to do a lot more about that going forward.
“All of the other companies are doing a great job in that as well, but that will be our challenge getting those people into Emerald, and giving people living in Emerald right now, the opportunity to train up as an unskilled person in mining but we can do that at either Minerva, Gregory, Wilton-Fairhill or Meteor Downs.”
Ms Spalding said access to accommodation was also flagged, with many projects in the wider region returning to production at the same time.
“You’ve got mining communities out in Blackwater that have almost no access to accommodation, the mining camps are completely full so they are spilling over into Emerald which is a 45 minute drive,” she said.
Surviving the Next Downturn
Mr Vorias said the cyclical nature of the industry meant coal prices would eventually come down again, but Emerald was ready.
“I’ve seen so many of these [downturns] in my career,” he said.
“The things you have always got to be mindful of (and I say this to all of the managers that sit in the business) is always make your decision based on the fact the market could drop again over the course of the next couple of years.
“Let’s hope it goes longer than that.”
Mr Vorias said it was imperative to not “spend extra money on things that are not sustainable” should prices drop.
“For example at our Meteor Downs mine, we built it on the basis it would survive during a worse time in the industry than what we had three or four years ago,” he said.
“We try to recession-proof our operations.”
Ms Spalding said Emerald was a diverse region, with a number of core industries, and was confident it would manage through the next downturn.
“We’re not a one trick pony here in Emerald or the Central Highlands,” she said.
“Mining is obviously incredibly important to us but we’ve got tourism, we’ve got the agricultural sector, we’ve got small business, and we’ve got construction.
“So when these downturns happen it’s not so much for us a downturn but our businesses can pivot and shift quite quickly to service the other industries.”
But for now, the town was ready to service Gregory Crinum and the next generation of coal mines.
“It’s a really exciting time,” Ms Spalding said.
“Our businesses are really well positioned for those big projects, we’ve been doing this for a long time; they’re ready to go and more skilled, and more sustainable and capable than ever.”