“We are at the centre of one of the greatest resource booms in living memory. But there is a growing realisation that we have not taken full advantage of this boom and that government and industry need to do a lot better if Australia is to fully realise the opportunities of the strongest global market growth in a generation,” Coates said, speaking in his capacity as chairman of the Minerals Council of Australia.

Coates, delivering his address at Minerals Week 07, underscored the need to focus on solutions to the key economic issue for the minerals industry – capacity constraints to growth.

“The high prices, now, tend to camouflage a lot of sins,” Coates said. “How will we be placed when the tide turns, when supply catches up with demand, when the market shifts from a sellers’ market to a buyers’ market?

“There is no doubt that our performance to date has been impacted by east coast port and rail capacity, the availability of skilled labour and also by the legislative and regulatory barriers to development which are increasing daily. These will continue to be issues for the industry in future along with the added complications of lack of water and electricity shortages.

“The current drought, arguably the worst in 100 years, is impacting all Australians. In the minerals industry it is impacting on individual mining and mineral processing operations, it is affecting our social licence to operate – we are competing for water with the communities in which we operate – and it is impacting on electricity prices, especially for energy intensive industries.

“The combined impacts of climate change and efforts to reduce emissions, together with lack of water management, have the potential to have a profound effect on future water and energy costs and availability, and consequently the future growth of our industry and the future wealth of our country.”

Coates said it was essential these constraints be treated as national issues and that the states work with the Federal Government to develop appropriate national strategies to efficiently and effectively arrive at “cross-border solutions”

On electricity, Coates warned, “The potential shortfall and potential for soaring energy costs is a crisis that few seem to fully understand. What we need is a commercial pathway towards low emission technologies that simultaneously addresses our competitive electricity needs.”

On labour shortages facing the industry, Coates said this would be a major constraint on the growth of the minerals sector over the next decade.

“One of the key issues that deter professionals from entering our industry is the punitive occupational health and safety legislation that exists, particularly in New South Wales,” Coates said.

“Few contest the need for a nationally consistent, risk-based preventative system with minimal prescription, that does not reduce standards, but provides the enabling framework to harness and promote the industry’s commitment to zero harm. The problem is the reform delivery and the capacity of regulatory institutions.

“But one of the most immediate constraints on the industry’s growth is the lack of appropriate management of export infrastructure on Australia’s east coast, leading to long queues of ships off ports in NSW and Queensland.”

He said to address what was required included:

• Committed and effective plans that span the whole coal export chain;
• Contracts which ensure rail track, train and port providers have a financial interest in ensuring efficient export throughput; and
• Enhanced performance accountability by the infrastructure providers.

If the current infrastructure owners were neither willing nor comfortable with such accountability, Coates said, the industry would be “willing to buy and run the infrastructure it needs for its business”

“Our performance as an industry and as a country will continue to suffer unless we solve these coordination and ownership issues,” Coates said.