Dragline deluge; 'Wild West' rush to rustle coal

The great Australian coal rush is on. Huge draglines, deployed in new open-cut mines, are ripping into coals seams in Queensland and New South Wales, promising to put Australia in the big leagues of energy exports.

Australia's exports of energy could be about half of those of Saudi Arabia's in the next 10 to 20 years, according to the Paris-based International Energy Agency.

But, warns Sen. John Carrick, minister of development and energy, Australia's ability to export energy products depends on the country's ability to keep its inflation rate down.

Another key, the senator says, is the ability of the country to build the infrastructure, such as new railroads, ports, and in some cases, new towns. Since the infrastructure is the responsibility of the states, funding of such projects will place a major burden on Queensland and New South Wales, the states that produce 95 percent of Australian coal.

The opposition Australia Labor Party, however, believes some of the cost should be paid by the federal government.

Paul Keating, the Australian Labor Party shadow minister for energy and development, complains, "Australia is developing its resources when most of the rest of the world has stopped." He would like to see smaller projects, tailored more closely to world demand coupled with the corporate funding of infrastructure projects. He complains, "The development has a kind of Wild West quality to it," and he blames this on the "cargo cult" mentality of some state premiers.

australian production is already large: The country is the world's second largest coal exporter. it also has large reserves, estimated at 640 billion metric tons, giving it the fourth largest reserves in the world.

For the most part, its exports are coking coal -- used by the Japanese to produce the steel that goes into Toyotas and Datsuns. In the future, it will be steaming coal, used to produce electricity for the masses in Tokyo and Nanila.

The IEA has suggested that by 1990 total Australian coal exports could reach 90 million tons a year, compared with the current 43 million tons a year, and by the year 2000 could reach 160 million to 200 million tons with steaming coal exports of 75 million to 120 million tons compared with a current 8 million tons.

In Canberra, officials in the Department of National Development and Energy are less sanguine. To meet the IEA projections, says one official, Australia will need to open one new major mine each year at a total cost of $15 to 20 billion.

"I don't think we will reach that level and that demand," says an official in a background briefing. The government, to better estimate the demand, has been pressuring the Japanese and other customers to give early and firm commitments in the form of long-term contracts.

Dr. Phyllis Rosendale of the institute for Applied Economic Research, University of Melbourne, believes the Japanese have been slow to sign agreements , prefering to diversify coal suppliers.

Even the mining industry has some doubt whether coal will be developed as fast as the IEA forecasts. G. Paul Phillips, president of the Mioning Industry Council in Canberra, comments: "One list has 62 new coal mines opening. There is no way all those will get off the ground -- there just isn't the infrastructure."

Australia itself will be a major consumer of its own coal, using it for power generation. The country currently consumes about 40 million tons of black coal. Senator Carrick estimates that in the nest decade electric power generation in Australia will double. Some 30 percent of this electricity, he estimates, will be used to make aluminum.