Speaking at the Mining Logistics & Supply Chain Management conference in Brisbane, Talbot said Australia must ensure infrastructure was expanded to meet an additional 80 million tonnes per annum by 2010, or risk letting in new competitors including Indonesia, Mongolia, Russia and Mozambique.

“Over many years Queensland has developed a hard-earned reputation as a reliable supplier of quality coal. This reputation could be compromised if we can’t demonstrate our capacity to expand infrastructure,” he said.

Talbot spruiked the benefits of expanding Australia’s, and specifically Queensland’s, rail and port capacity. According to Queensland Resource Council’s estimates, an additional 80Mtpa of coal exported by 2010 would be equivalent to 3,000 new jobs and an additional $A350 million in royalty revenues into the state coffers annually.

So what moves has the Queensland government and private sector made so far to increase supply chain capacity?

Northern Queensland port Abbot Point’s stage two expansion is well advanced and site works will commence in the new year. These works will increase capacity of Abbot Point to 25Mtpa and provide a foundation for future expansions associated with the Northern Missing Link.

BMA is well underway on the first stage of its Hay Point expansion with extensive earthworks ongoing towards the development of a new stockpile. Talbot said feasibility studies on subsequent expansion stages were also well advanced.

The Dalrymple Bay Coal Terminal (DBCT) will undergo a number of expansions which will lift the port’s capacity to 85Mtpa by the third quarter of 2008. The port’s short gain project to lift capacity by 4Mtpa by early next year is currently underway with a replaced reclaimer on-line early next year and works underway for a third train unloading system.

During his presentation, Talbot raised concerns over the short-term pressure on capacity at DBCT with no spare capacity at the operation going forward. He also highlighted that for three separate months next year port capacity would be reduced to 50Mtpa.

“Despite this progress and despite the best intentions of all parties, these expansion projects still have a number of hurdles to cross,” Talbot said.

He said contracts for the allocation of new tonnage must be finalised with users and the port operator; the QCA must approve a revised Access Undertaking and approve proposed expansion plans for inclusion in the asset base; and the majority of users must agree to extend the capital averaging concept for proposed works.

“I am not suggesting that these hurdles are insurmountable, but the Phase 1 expansion to 68Mtpa is due for commissioning in Sep 2007. I understand from the schedule of works that it is already on the critical path,” Talbot said.

“We can not allow any slippage in obtaining each of the three outstanding matters or else the timing of the expansion is at risk.”

In Gladstone, the Central Queensland Ports Authority is full steam ahead on its expansion projects both at Barney Point and Reg Tanna Coal Terminal as well as long term development plans for Wiggins Island. In the short term, these expansions will see an additional 25Mtpa of capacity on-line as early as February 2007.

On the rail side, the Queensland Rail Network is close to finalising its Rail Master Plan for the state. Talbot said once agreed and approved by the Queensland Competition Authority, this plan will become the blueprint for coal rail development in the state for the next ten years.

Key projects currently underway include the Northern Missing Link feasibility study, third unloading loop at DBCT, Conner’s Range 3rd crossing investigation, the Blackwater System and Rollingstock procurement program.

While rail and ports often grab the headlines, Talbot was quick to highlight that “water infrastructure is as, if not more, important than transport capacity” for Queensland mines.

Work on the 215km Burdekin-Moranbah pipeline and the associated eastern spur from Moranbah is about to begin. The line will be critical for development of mines in the northern Bowen Basin.

The Gattonvale off-stream storage will also increase the availability of water to coal mines in the region and to the Collinsville Power Station. Importantly the additional storage will ease demand pressure on Eungella Dam.

During the conference, Talbot highlighted the main issues surrounding the need for expanded infrastructure. He said the biggest issue, especially from a customer perspective, was reliability.

“In an overall system sense, we should learn from the lessons of the US oil industry and its dependence on the Louisiana Offshore Oil Port. As a result of Hurricane Katrina, major oil imports into the US were reduced by up to six weeks during 2005. We need to ensure that we have back-up systems to ensure flexibility and reliability,” he said.

“The proposed Northern Missing Link would provide such flexibility if capacity at Hay Point or DBCT were impacted by a cyclone or other unforeseen events.”

Talbot said planning was also a number one priority as it allowed suppliers to commit to infrastructure development, allowing for consistency and cooperation across the entire system.