Plant & Equipment

Call for more quality control in project assessments

The New South Wales Planning Assessment Commission (PAC) recently released its review of the Wallarah 2 coal project proposal, which was highly critical of the NSW Department of Planning (DoP) and Environment’s acceptance of the economic benefits claimed in the application.

“The commission’s view is that the [DoP Preliminary Assessment Report’s] acceptance of the benefits of the project as presented by the proponent is simply not credible,” the report stated.

The commission labelled the proponent’s project benefit estimates “unreliable”, stating that there was a “staggering” difference of over $1 billion in claimed benefits.

“No attempt has been made to address the specific points raised by the critics of the economics assessment yet these points appear to be soundly argued and entirely plausible,” the report stated, adding that it was not acceptable for the DoP to “gloss over” these kinds of issues with “a few generalisations”.

“Far greater quality control is required over inclusion in assessment reports of untested claimed benefits for a project… There is now a substantial body of adverse comment about the standard of economic analysis for mining projects in NSW generally and this appears to be increasing rather than abating,” the report concluded.

Greg Thomson, director of environmental consulting firm VGT and secretary of the NSW branch of the Institute of Quarrying Australia, said that the quarry industry would do well to read PAC’s review of the Wallarah 2 coal project proposal.

“The quarry industry can take from this coal mine proposal that it needs to consider carefully the economic viability of proposed projects because potentially overstated figures are on the PAC’s radar,” he said.

Flagging support for coal mining

Thomson added that the quarry industry should also take note of a new research paper that shows there is a lack of support for the coal mining industry.

The Seeing through the dust: Coal in the Hunter Valley economy report released by The Australia Institute analysed the results of a survey undertaken in November 2013 of 1001 Hunter Valley residents. It found that 83 per cent of respondents did not want to see the expansion of the coal industry, with 41 per cent preferring a decrease in, or complete phase out of, coal mining.

A statement released by The Australia Institute said that a smaller coal industry would have “only minor impacts on the future Hunter economy”. However, Thomson said that a reduced coal mining sector could have flow-on effects for other industries, such as quarrying.

“A contraction of the coal mining industry is always a concern to the quarry industry due to a potential downturn in the need for quarry products, including haul road aggregates and blast hole stemming as well as quarry services such as contract crushing and processing,” he explained.

A copy of the PAC’s review of the Wallarah 2 proposal can be found on the PAC website.

The Australia Institute report is also available online.

Sources: NSW Government, VGT, The Australia Institute

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