NSW Primary Industries Minister Ian Macdonald is standing by the poker machine waiting to pull a jackpot for the coal mining industry. But who will get the prizes?

Currently on offer to foreign and local mining companies are 13 coal exploration licences.

Expressions of interests have been called for one licence covering the Ridgelands exploration area in the upper Hunter coalfield and another in the East Bargo exploration area, 100km south-west of Sydney.

This leaves 11 licences on offer, mainly to small and medium-sized companies, for the Gunnedah, Hunter and Western coalfields.

A DPI spokeswoman said:

There’s been strong interest from small companies for additional coal allocations in small and remnant areas which have previously been unattractive due to lower coal prices.

Limited information is available on these 11 areas with tonnage unknown at this time. Exploration in the area will establish the resource.

We are talking about small resources and these are only for exploration licences to determine if there is actually coal in these deposits. The government does expect some revenue but given these are small deposits and will not come on line for five to 10 years, if at all, it would only be small.

That’s not how the Greens see it. They claim that a NSW government exploration licence is a licence to start digging and that the coalmining industry in the Gunnedah, Hunter and Western coalfields is simply being expanded by stealth.

Macdonald has ordered an “expert panel” of “independent officers” to determine where the 11 licences should be allocated and to which companies.

There is keen interest in whether companies from the People’s Republic of China will take home a prize. Macdonald is a long-standing friend of China and has developed a strong business network with the help of his friend Alan Fang, chairman and CEO of the Tianda Corporation which began as a pharmaceutical company but has now branched out into mining resources.

Macdonald’s decision on all 13 licences is being eagerly awaited by Labor Party backbenchers, Barry O’Farrell’s State Opposition, the Greens and the NSW Minerals Council, which represents the mining industry.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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