Adani’s coal mine another step closer, fracking to kick off in the NT (WA soon too?) and our energy minister hasn’t shut the door on nuclear power. Thank <insert choice of deity here> it’s Friday.
Fossil fuel advocates will be punching the air and high-fiving each other with some recent news, while nuclear energy supporters in Australia may also see a glimmer of hope for their cause.
Adani Groundwater Plan Approved
The Queensland Department of Environment and Science (DES) approved Adani’s Groundwater Dependent Ecosystem Management Plan (GDEMP) for its Carmichael coal mine in Queensland’s Galilee Basin yesterday. This means the company can now start some work on the mine.
Federal Employment Minister Michaelia Cash reportedly stated it was a great win for Queenslanders and that “we need to take a long, hard look at red and green tape in Australia”.
When I mentioned the approval to SQ’s Ronald, he said:
“The Great Artesian Basin is the only artesian basin in the world that is in good health. I didn’t realize we were keeping it pristine for the advantage of an Indian coal mining company.”
While the news will come as a major disappointment to many, the Greens say the fight isn’t over yet – not by a long shot.
“Adani still doesn’t have all its legal licences, and it’s never had a social licence,” said Senator for Queensland and Greens spokesperson for mining and resources, Larissa Waters.
Before the first chunks of coal can be pulled from the ground, Adani will still need to gain other federal environmental approvals and a royalties agreement is yet to be finalised. Among the hurdles remaining is the little detail of getting the coal out of the area, with a shadow still looming over the Carmichael Rail Network; intended to link the Carmichael mine with Abbot Point Port near Bowen.
Questions also remain as to whether the mine is even financially viable, but Adani remains bullish on this.
The Greens say it will use whatever means are available in parliament, the courts and on the streets to try to prevent the mine going ahead; including continuing to push for a climate trigger in Australia’s environmental laws.
“It’s time for politicians like Annastacia Palaszczuk to come clean with coal communities, admit that there are no long term jobs in digging up and burning coal and work with the Greens on a plan to support these communities transition away from coal and towards sustainable, long-term jobs in the renewable energy sector,” said Greens leader Dr Richard Di Natale.
Referred to as a “carbon bomb”, the Carmichael mine has approvals to rip out up to 60 million tonnes of thermal coal annually, but Adani is reportedly planning to produce about 27.5 million tonnes.
More on the decision, the mine and some concerns aside from the massive amounts of carbon emissions and toxins that will be unleashed from burning what is pulled from it can be viewed here and here.
New Code Enables Fracking Up The NT To Begin
Earlier this week, the Northern Territory Labor Government finalised the Code of Practice for the NT’s onshore gas industry; i.e. fracking.
“Our Government has a clear plan to protect our environment, create local jobs and ensure the actions of Government and industry are transparent and accountable,” said Minister for Primary Industry and Resources, Paul Kirby.
It’s now game on for fracking in the Territory. The fracking moratorium was lifted in April last year, but the Code needed to be completed before activities could begin – and it seems there’s a number of players not wanting to waste any time in getting started.
While 49% of the Territory will be “frack-free”, it means there’s around 688,000 square kilometres that could potentially host fracking activity.
An ABC report says exploration could begin in “days, if not weeks”.
On a related note, across the border in Western Australia work is reportedly under way on what could be WA’s first fracking gasfield says Lock The Gate Alliance. However, regulations governing fracking in WA are yet to released or legislated. The WA Government has been clever in selling fracking, last year lifting the state’s moratorium but committing to using fracking royalties for funding new renewable energy projects.
Angus Taylor On Nuclear Power – Willing To Consider It, But..
Australia’s pro-nuclear lobby have also been thrown a bone; albeit a small, brittle one with sharp edges and very little meat left on it. The type you wouldn’t give to a dog as it would probably choke.
Minister for Energy and Emissions Reduction Angus Taylor was quizzed by journalists in a doorstop interview on Wednesday about the potential for nuclear power in Australia. Here’s the relevant bits.
JOURNALIST: Are you now willing to start a conversation about nuclear energy?
ANGUS TAYLOR: The Prime Minister has made many comments on this in the lead up to the election. Right now, it is illegal to build a nuclear power station, and as he just said, when there’s a very clear business case that shows the economics of this can work, we’re more than willing to consider it.
You can read the full exchange here.
There’s little hope of a viable business case being presented. While Minister Taylor may not have closed the door on nuclear power in Australia himself, he doesn’t need to as it’s pretty much already shut. This is just a distraction – nuclear power is horribly expensive; meanwhile the costs of renewables such as wind and solar energy (and energy storage) continue to plummet.
Minister Taylor also made some curious comments this week regarding LNG, stating Australia’s LNG boom is “ reducing our global carbon impact“.
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On Tuesday (June 11), BP released its “BP Statistical Review of World Energy 2019” – a snapshot of global energy reserves, production, consumption, trades and prices in calendar year 2018.
BP’s June 11 Press Release is headlined “BP Statistical Review of World Energy 2019: an unsustainable path”, and includes:
This year’s edition highlights the growing divergence between demands for action on climate change and the actual pace of progress on reducing carbon emissions.
Key findings from the BP Stats Review 2019 include:
▪ Global energy demand grew by 2.9% and carbon emissions grew by 2.0% in 2018, faster than at any time since 2010/11.
▪ Natural gas consumption and production was up over 5%, one of the strongest rates of growth for both demand and output for over 30 years.
▪ Renewables grew by 14.5%, nearing their record-breaking increase in 2017, but this still accounted for only around a third of the increase in total power generation.
▪ Coal consumption (+1.4%) and production (+4.3%) increased for the second year in a row in 2018, following three years of decline (2014-2016).
▪ The United States recorded the largest-ever annual production increases by any country for both oil and natural gas, the vast majority of increases coming from onshore shale plays.
Introducing the findings for 2018, Spencer Dale, BP chief economist, said:
“There is a growing mismatch between societal demands for action on climate change and the actual pace of progress, with energy demand and carbon emissions growing at their fastest rate for years. The world is on an unsustainable path.”
“The longer carbon emissions continue to rise, the harder and more costly will be the necessary eventual adjustment to net-zero carbon emissions,” concluded Bob Dudley, BP group chief executive. “As I have said before, this is not a race to renewables, but a race to reduce carbon emissions across many fronts.”
See: https://www.bp.com/en/global/corporate/news-and-insights/press-releases/bp-statistical-review-of-world-energy-2019.html
Affordable solutions to rapidly reduce global human-caused GHG emissions are available. All that is missing is the political will to do so. But the remaining time to take effective action is rapidly expiring to mitigate/reduce the risk of human extinction within this century.
See my comment: https://www.solarquotes.com.au/blog/yallourn-coal-closure-mb1086/#comment-455395
I saw that and it predicts a big rise in coal consumption in India. I find it hard to believe given solar is beating new coal there on price. Fingers crossed they continue to cancel — or at least delay — new coal power stations.
Ronald Brakels,
You say:
“I saw that and it predicts a big rise in coal consumption in India.”
Keep in mind the “prediction” contradicts the Paris Climate Agreement objectives. I would suggest you just focus on what the tables and graphs are telling you.
For instance, for coal production in 2018 (BPSRoWE-2019):
Canada: 0.7% global share, growth rate in 2018 was -10.3%, 2007-17 growth -1.1% pa;
Mexico: 0.2% global share, growth rate in 2018 was +4.7%, 2007-17 growth +0.1% pa;
USA: 9.3% global share; growth rate in 2018 was -1.9%, 2007-17 growth -4.0% pa;
Total North America: 10.2% global share, growth rate in 2018 was -2.4%, 2007-17 growth -3.7% pa;
Total South & Central America: 1.5% global share, growth rate in 2018 was -8.1%, 2007-17 growth +1.6% pa;
Total Europe: 4.3% global share, growth rate in 2018 was -1.9%, 2007-17 growth -3.6% pa;
Russian Fed: 5.6% global share, growth rate in 2018 was +7.0%, 2007-17 growth +3.7% pa;
Total CIS: 7.0% global share, growth rate in 2018 was +6.4%, 2007-17 growth +3.3% pa;
Total Africa: 4.0% global share, growth rate in 2018 was +0.4%, 2007-17 growth +1.0% pa;
Australia: 7.7% global share, growth rate in 2018 was +0.7%, 2007-17 growth +2.8% pa;
China: 46.7% global share, growth rate in 2018 was +4.7%, 2007-17 growth +2.0% pa;
India: 7.9% global share, growth rate in 2018 was +7.5%, 2007-17 growth +3.1% pa;
Indonesia: 8.3 global share, growth rate in 2018 was +18.9%, 2007-17 growth +7.8% pa;
Total Asia-Pacific: 72.8% global share, growth rate in 2018 was +6.1%, 2007-17 growth +2.7% pa;
Total World: 100% global share, growth rate in 2018 was +4.3%, 2007-17 growth +1.3% pa.
The main coal production growth is in Indonesia, India, Russian Fed., and China.
India and China will protect their mining industries and reduce their thermal coal imports – so coal exporters like Indonesia and Australia will find it increasingly more difficult to export into a shrinking thermal coal market.
See: https://www.abc.net.au/news/2017-07-06/galilee-basin-mining-project-will-reduce-coal-output:-research/8682164
See: http://www.tai.org.au/content/adani-s-automated-mine-risks-just-transition-coal-workers
See: http://johnmenadue.com/kate-finlayson-and-tim-buckley-queensland-government-about-to-make-poor-economic-decision-on-adani-mine/
Fascinating Geoff…
On the one hand we have senior executives from mammoth global energy companies like BP making comments such as:
“There is a growing mismatch between societal demands for action on climate change and the actual pace of progress, with energy demand and carbon emissions growing at their fastest rate for years. The world is on an unsustainable path.”
AND
“The longer carbon emissions continue to rise, the harder and more costly will be the necessary eventual adjustment to net-zero carbon emissions,” concluded Bob Dudley, BP group chief executive.
Closer to home, an article at ‘Energy Source Distribution’ which can be found here: https://www.esdnews.com.au/bhp-says-theres-no-future-in-thermal-coal/
stated recently that: ‘BHP is the latest mining giant to announce its lack of interest in a coal-powered future, saying that it had “no appetite for growth” in the resource.
The company said it expects coal to be “phased out, possibly sooner than expected”, and as such has no intention to grow its thermal coal portfolio “regardless of asset efficiency”.
BHP follows its peers Rio Tinto, Woodside Energy and Glencore in backing away from coal, showing a broader trend in the industry.
It is beyond ludicrous here in Queensland.
Energy and mining companies world-wide are already actively taking steps to diversify their portfolios away from coal and are in fact, embracing renewables in their own daily business operations. You can find some information about those here: https://www.th-energy.net/english/platform-renewable-energy-and-mining/database-solar-wind-power-plants/
Some of these installations are massive – eg. one copper mine in Chile has an associated 25.4 MWp PV installation nearby which provides electricity for mine consumption.
In what is not just ludicrous but also utterly bizarre, on the 7th June 2019, – according to an article in PV Magazine Australia found at: https://www.pv-magazine-australia.com/2019/06/07/adani-switches-on-65-mw-queensland-solar-farm/ – the now well-known Adani company turned on its not so well-known flagship 65 MW capacity solar PV array in Central Queensland.
To quote from the article: “The plant located near Moranbah, central Queensland, is expected to ramp up to full operation in the months ahead and deliver 185,000MWh of electricity annually. The project features 247,000 solar panels and represents the first phase of the Rugby Run solar project, which has the capacity to expand to 170 MW.
The Indian mining giant’s renewables arm will be selling 80% of the project’s output under a power purchase agreement to an Australian electricity retailer. The remaining 20% will be sold on the spot market.
The $100 million Rugby Run project was self-financed by Adani. The developer managed construction contractors directly, and not via the EPC contract model. More than 175 people were employed during peak construction periods.”
There are other large scale PV projects planned for Queensland and elsewhere in Australia too, which you can read about on the same PV Magazine web-page.
The overall ‘energy policy chaos’ in Australia looks set to continue, and it seems to me that Adani have cleverly exploited the situation.
Despite the Queensland Premier breathing fire about how Adani needs to create 8000 jobs or else, it seems fair more likely to me that Adani will go through the motions of establishing the mine, then end up closing it down and demanding compensation for having to do so.
According to this Brisbane Times link at: https://www.brisbanetimes.com.au/national/queensland/premier-promises-adani-won-t-be-the-last-mine-she-approves-20190614-p51xp8.html
the Queensland “Premier promises that Adani won’t be the last mine she approves”.
The Greens seem to be the only party left with any ethical environmental platform these days.
I wouldn’t lose hope entirely about Adani falling by the wayside. According to an ABC article published today at:
https://www.abc.net.au/news/2019-06-14/wa-power-retailer-synergy-forecast-to-lose-$180m-in-three-years/11199906
The alarming headline reads: ‘WA power retailer Synergy forecast to lose $180 million over three years as dire finances revealed’.
WA’s major generator Synergy – which supplies 50% of the State’s electricity, is also wholly owned by the WA Government. Most of Synergy’s supply is generated from coal and ga, and it’s now losing significant amounts of money.
The 4 key reasons given for Synergy’s financial problems are –
– rapid uptake of roof-top solar by individuals and businesses. ( you can also add local government councils and schools to the list of rapid uptakers ))
– high natural gas prices
-lower residential electricity tariff price path announced in this year’s WA Budget and an increase in network charges from Western Power that have not been passed on to customers in the franchise market.
– high ‘fixed cost’ base (of large scale generators)
Synergy needs to borrow a further $140 million to fund much needed capital expenditure, which will further weaken its financial position.
I found the last sentence of the article rather revealing. It states:
“The Government has launched a review of WA’s electricity system through its Energy Transformation Initiative in a bid to lay out a road-map for the industry.”
That ‘road-map’ for future directions is scheduled for completion at the END of 2019. Which implies that it will be some time after 2019 before anything gets finally decided upon, let alone become operational.
Back in January 2018, the West Australian newspaper warned that:
“Power supplies from WA’s rapidly growing number of solar panels risk overwhelming the State’s biggest grid within years unless measures are put in place to better handle uptake of the technology, a leading energy expert says… even though about one in four households now had solar panels on their roof, the amount of additional solar capacity was running at a staggering 35 per cent a year… It is believed solar power could displace 100 per cent of traditional generation such as coal- and gas-fired plants for short intervals within as few as five years based on current trends… the trend could be disastrous for conventional power stations…
…it was up to electricity providers and authorities to ensure the grid could cope, rather than try to crimp demand for the systems.”
You can read the full West Australian article here: https://thewest.com.au/news/wa/solar-may-threaten-grid-says-expert-ng-b88584548z
What’s not being discussed is where global petroleum oil supply is heading.
BPSRoWE-2019 on page 22 shows graphs for oil production and consumption by region, from 1993 to 2018. Below these graphs it states:
“Global oil production increased by 2.2 million b/d in 2018. Growth was heavily concentrated in the US (2.2 million b/d), Canada (410,000 b/d) and Saudi Arabia (390,000 b/d) while oil production declined sharply in Venezuela (-580,000 b/d) and Iran (-310,000 b/d). OPEC production declined by 330,000 b/d while non-OPEC production increased by 2.6 million b/d. Oil consumption in 2018 grew by an above average 1.4 million b/d. China (680,000 b/d) and the US (500,000 b/d) accounted for the majority of this year’s growth.”
See: https://www.bp.com/content/dam/bp/business-sites/en/global/corporate/pdfs/energy-economics/statistical-review/bp-stats-review-2019-full-report.pdf
I note most of the world’s petroleum oil production growth in 2018 (per BPSRoWE-2019) was from one country – USA (+2.2 Mb/d).
To gain a better perspective of where US crude oil growth is coming from, please go to IMO a very informative weblog post “World crude production outside US and Iraq is flat since 2005”, dated June 10, where the “Fig 18: US conventional vs shale (tight) oil” shows how all the US crude oil production growth over the last decade is originating from shale (tight) oil.
See: https://crudeoilpeak.info/world-crude-production-outside-us-and-iraq-is-flat-since-2005
However, directly below Fig 18 are the words:
“The EIA predicts further shale oil growth but this may be too optimistic, especially if there is another credit crunch or oil prices go too low because of a global recession.
The Norwegian consultancy Rystad Energy calculated that only 10% of US shale oil companies are cash flow positive:”
Below that is shown “Fig 19: Cash flow and CAPEX of US shale oil companies”, indicating nearly all US shale oil companies are losing money. Sooner or later, investors will ‘wise-up’ and more capital investment in US shale oil will likely be much more difficult to come by.
Also, per BPSRoWE-2019, at the end of 2018, USA has a Reserves-to-Production (R/P) of only 11.0 years, yet it’s currently the world’s largest crude oil producer (16.6% global share). It seems to me the day of reckoning is fast approaching.
In addition, US shale (tight) oil has major limitations:
• US shale oil is a light oil, not easily converted to diesel, which is the most important transportation fuel, nowadays. It’s also ill-suited for producing aviation turbine (jet) fuel and the higher octane gasoline (petrol) grade fuels for high-performance vehicles, unless extensively blended with “heavy” crude oils;
• The oil industry has been converting more and more “heavy” oil into diesel fuel, leading to diesel fuel becoming more scarce and more expensive, to the point that its production may have peaked globally in 2015;
• Additionally, there’s a dearth of heavy oil, the fuel of choice for marine transportation;
• US shale oil output is surging, but US refineries can’t process much more light crude, per a Morgan Stanley research note;
• There are limited export opportunities for US shale crude, meaning light oil may soon have to trade at a discount to compete – not good for shale oil producers already losing money;
• Outputs from heavy crude producers Venezuela and Mexico are falling, and pipeline bottlenecks are restricting flows from Canada.
See: https://cassandralegacy.blogspot.com/2018/12/peak-diesel-or-no-peak-diesel-debate.html
See: https://www.cnbc.com/2018/04/17/shale-oil-has-a-refining-problem-and-morgan-stanley-smells-opportunity.html
And a new International Maritime Organization rule that comes into effect at the beginning of 2020 is likely to exacerbate global diesel and marine fuel prices from October 2019.
See: https://www.reuters.com/article/us-imo-shipping-usa-refiners/new-marine-fuel-rules-to-boost-diesel-prices-for-at-least-a-year-analysts-idUSKCN1TB2CJ
Has global peak diesel supply already arrived? It’s still perhaps too early to tell conclusively.
Rather than waiting for declining global petroleum oil supplies being forced upon us, humanity needs to leave oil before oil leaves us.
So, Scott Morrison’s accusations that Bill Shorten was wanting to “end the weekend” will be the least of our worries.
See: https://www.theguardian.com/australia-news/2019/apr/07/shorten-wants-to-end-the-weekend-morrison-attacks-labors-electric-vehicle-policy
I see more questions are being raised (by IEEFA, yesterday) about the financial risks associated with the Queensland Adani Carmichael mine and rail project.
See: http://ieefa.org/ieefa-australia-contracting-with-adani-australia-entails-counterparty-risks/
And it seems some pressure is reportedly being applied to some companies to limit dealings with Adani.
See: https://www.abc.net.au/news/2019-08-16/adani-snubbed-by-rail-company-as-aurizon-faces-pressure/11418900?section=business
Adani also appears to have problems getting insurance:
https://theconversation.com/adani-beware-coal-is-on-the-road-to-becoming-completely-uninsurable-121552
Thanks Ronald,
Yet Senator Penny Wong, when interviewed on ABC Insiders yesterday morning, indicated Labor would not have agreed to ban the creation of new coal mines as suggested by some small Pacific Island nations when leaders from the region met last week at the Pacific Islands Forum. She said:
“Coal remains an important industry for Australia and it remains part of the global energy mix.”
https://www.news.com.au/technology/environment/climate-change/labor-slams-scott-morrisons-botched-pacific-negotiations-but-backs-coal-industry/news-story/7c990bcada3aa80ae0059679069381a6
It seems to me key Labor politicians are also in denial about the escalating factors that will see the thermal coal industry in a sustained decline here in Australia in the 2020s – many indicators suggest to me it has already started (and you, Ronald, have highlighted another).
See: https://www.ipcn.nsw.gov.au/resources/pac/media/files/pac/projects/2018/10/bylong-coal-project/comments-on-expired-conditional-gateway-certificate/geoff-miell.pdf
I think Senator Wong (and many other Australian politicians) are providing false hope to Australian coal mining communities.
Former chair of the Australian Coal Association, Ian Dunlop, concluded in an op-ed in the Newcastle Herald on Aug 10:
“Community organisations, coal companies themselves, unions and regulators, all in their own self-interest, must now start to plan the transition, otherwise many people will be badly hurt, particularly in the coal industry itself.”
See: https://www.newcastleherald.com.au/story/6316450/comments-prove-climate-denial-is-king/
How long before our leaders (politicians, unions and business) wake-up to the reality and start facing the challenges with effective action to limit the pain to the affected coal mining communities?
Coal power is, unfortunately, not going to disappear overnight. But we can’t afford to open new coal mines. We can’t afford it from a not trashing our children’s futures point of view and we can’t afford it from an economic point of view given the current low cost of renewable energy. Any new coal mine is likely to end up as a stranded asset.