India a 'golden opportunity' for Galilee Basin coal
THREE or four new Adani-sized coal mines in the Galilee Basin could be needed to supply growing demand from India, according to Resources Minister Matt Canavan.
Senator Canavan was speaking after the release of Coal in India 2019, a new government report outlining India's potential as Australia greatest, new thermal coal export market, potentially creating more than 4,000 new direct jobs.
"If we could lift our thermal coal exports to India to the same market share we currently have with China - to just under 25 per cent of their imports - we could export an additional 37million tonnes of high energy, low ash thermal coal," he said.
"That is the equivalent of three or four new Adani Carmichael - sized coal mines. If this investment occurred in the Galilee Basin, it would open up a new, sustainably-sized coal basin in Queensland.
"Based on current prices, Indian exports could potentially bring $3.4billion in extra export income and provide around $240million in royalties for State Governments."
In 2018, Australia exported 5million tonnes of thermal coal to India.
The figure represents 2.3 per cent of thermal coal exports, and only 4.5 per cent of India's thermal coal imports.
Senator Canavan says Australia can do better.
"The recent approval of the Adani Carmichael mine could just be the start of a new trade that can bring wealth and jobs to Australia," he said.
The Coal in India 2019 report said the growing Indian demand for energy presented a golden opportunity for Australia to ramp-up thermal coal exports to the country.
It found that India's energy future would help shape seaborne thermal coal markets for decades to come.
"India is the world's third largest energy consumer. It has the world's second largest population and is one of world's fastest growing economies," the report read.
"India's thermal coal consumption is likely to continue to increase next decade, and possibly beyond, in order to meet India's increasing energy requirements.
"The pace of India's coal production growth will be the key driver of its future thermal coal import needs."
The report detailed India's energy, electricity and mining policies and how they could impact on its future demand for Australian thermal coal.
"As the highly respected author of the India Economic Strategy to 2035 Peter Varghese AO said this week, there is no market in the world that has as much potential for increased trade with Australia as India - this report clearly illustrates that potential," Senator Canavan said.
"Australia is already a strong and reliable energy partner for India as it continues its rapid development trajectory and brings its people out of poverty. We can grow this relationship further.
"The growth of India's energy sector is truly astonishing. Since 2000, more than 500million people have been 'switched on' to electricity, with coal providing around 44 per cent of India's energy mix."
The report did highlight some potential hurdles posed by the Indian export market, primarily stemming from Indian aims to self-produce coal and self-sustain its energy system.
It said the Indian government was aiming for self-sufficiency in thermal coal, but faced considerable barriers to achieving this goal.
Senator Canavan said the key to selling Australian coal to India was to compliment their existing coal production, not to try and replace it, and offer a superior product to that of their other buying partners, such as Indonesia.
Queensland Resource Council and Capricornia MP Michelle Landry joined the Minister in his optimism following the release of the report.
Ms Landry welcomed the idea of more coal mines in, and around, her electorate, stating it would lead to jobs and lower electricity bills.
Senator Canavan will be in India next week where he plans to "promote the strengths and potential of Australia's resources and energy sectors."
He said it was time Australia committed to strengthening the trade relationship between the two nations.