Peabody Director Strategic Commodities & Capital Anthony Gabb also told a Bowen Basin Mining Club luncheon in Mackay that the company that was under growing pressure to get a quick return on investment in innovation because of the low coal price environment.
“What we’re doing as a business is no different to any other producer out there, and sustainable returns for innovation and operations are our main concern right now,” he said.
“To stay relevant, we want our suppliers (and potential suppliers) to focus on safety, have integrity, understand our business and ultimately to balance short-term needs with long-term sustainability. This includes understanding the limited maintenance budgets that many operators are managing, and striving to achieve return on innovation in a short timeframe – as short as three to six months.”
Peabody’s US coal operations were placed in Chapter 11 Bankruptcy protection earlier this year as the company struggled under a mountain of debt.
Peabody’s efforts to reduce its cost base while maintaining supplier relationships is being replicated around the industry but Australian innovators are trying to come up with solutions and overcome obstacles, Queensland Resources Council CEO Michael Roche said.
He touched on current roadblocks to the “new normal”, particularly legislative burdens that greatly impact on industry.
“There is no replacement for coking coal in the production of steel, and thermal coal is still very necessary for reliable power generation. Far from being yesterday’s hero, the mining sector is key to the future of Queensland – and needs to be recognised and treated as such,” Roche said.
“Due to unnecessary legislation introduced in Queensland, industry confidence about the state of regulation is at a five year low, and one in five mining CEOs said in a recent survey that they currently suffer a cost disadvantage in Queensland.
“This should serve as a wake-up call to all levels of government.
“However, the mining sector (and contractors in particular) are prolific innovators, and we should be proud of what we’ve achieved in the past few years.”
