QUPEX Lunch meeting 8 July 2014 Queensland’s energetic future – at risk from the activists Michael Roche Chief Executive About the Queensland Resources Council > The Queensland Resources Council (QRC) is a not-for-profit peak industry association representing the commercial developers of Queensland’s minerals and energy resources > 82 full members – explorers, miners, mineral processors, site contractors, oil and gas producers, electricity generators > 169 service members - providers of goods or services to the sector > Multi-commodity, state-based advocacy body formed in 2003 as successor to the Queensland Mining Council > Four CSG majors on QRC board. Paul Zealand (Origin) a QRC VP. Aberdare Collieries Civil Mining and Construction Kalimati Coal Company Rockland Resources Adani Mining Coalbank Leighton Contractors Santos/TOGA 82 Allegiance Coal Cockatoo Coal Linc Energy Senex Energy full Altona Mining ConocoPhillips Australia Lucas Group Shell Development (Australia) Anglo American Downer EDI Mining Macmahon Holdings Sibelco Australia members Anglo American Exploration Eagle Downs Coal Mgt Mastermyne Sojitz Coal Mining Aquila Resources Ensham Resources Metallica Minerals Stanmore Coal Areva Resources Australia ERM Power MetroCoal Summit Resources Arrow Energy Evolution Mining Millmerran Power Management Thiess 169 Bandanna Energy Exco Resources Minerals and Metals Group U & D Mining Industry service (Australia) Beach Energy Glencore Coal Mitsubishi Development Vale members Bengal Coal Glencore Copper New Hope Group Valiant Resources BHP Billiton Cannington Glencore Zinc Norton Gold Fields Wesfarmers Resources BHP Billiton Mitsubishi Alliance Golding Contractors Origin Energy Westside Corporation Caledon Coal Guildford Coal Paladin Energy 39 Whitehaven Coal Cape Alumina GVK Peabody Energy Yancoal Australia associate Cape Flattery Silica Mines International Coal QCoal Carabella Resources Investigator Resources QER members Carbon Energy Isaac Plains Coal Management QGC Carpentaria Gold Jellinbah Resources Queensland Coal Investments Cement Australia Jindal Steel & Power Rio Tinto Alcan Chinova Resources John Holland Rio Tinto Coal Australia Why resources are important to Queensland: Gas supercharges resources sector spend on Darling Downs 2009-13 2012-13 $2,500,000,000 1,180 direct employees $2,000,000,000 18,160 indirect $1,500,000,000 employees $1,000,000,000 15% of Darling Downs employment $500,000,000 27% of Darling $- Downs GRP 2009-10 2010-11 2011-12 2012-13 Source: www.queenslandeconomy.com.au 6 The looming LNG contribution $50 $45 LNG (Mt) A$/t $AU12 billion $40 Billions Zinc (kt) US$/t Silver (t) USc/troy oz $35 Lead (kt) US$/t $30 Gold (t) US$/oz $25 Copper content (kt) US$/t Black Coal (Prime Coking) (Mt) USD$/t $20 Black Coal (Thermal) (Mt) USD$/t $15 Bauxite (kt) A$/t $10 Aluminium (kt) US$/t Alumina (kt) A$/t $5 $- 2014 2018 forecast Source: BREE and IHS McCloskey The fundamentals 8 Addressing energy poverty IS socially responsible Current renewables can’t deliver reliability and scale to lift billions from poverty Skyrocketing electricity demand dictates we must make more from everything we have – coal, gas, uranium, renewables. 1.3 bn people without electricity; 2.7 bn without clean cooking facilities Japan wants our gas but will we be competitive? Government reform agendas mostly positive for gas but… PUP Senate gambit > Repeal of carbon tax (savings must be returned) > Renewable Energy Target, Climate Change Authority, Clean energy finance stay > One-stop-shop environmental approvals (more power to Qld Government) ?? And in Queensland > Reforms to EIS, QLeave, offsets, P&G tenure, overlapping coal and gas tenure > Long-term water, electricity, port and freight strategies > Exploration Advisory Committee, Resources Cabinet Committee, ResourcesQ > Some caution e.g. RPI Act implementation (unintended consequences) > Strong Choices: resisted further royalties hike, asset sales require user protections Will bipartisanship hold, what position will PUP take in lead up to next State election? Coal and gas under coordinated attack Orchestrated global/domestic ENGO campaign aimed at shutting Queensland coal industry is being implemented and deployed against gas (QRC scorecard released today): > Misrepresent threat to Great Barrier Reef from shipping, dredging, port development, developments on Curtis Island > Litigation: use the courts to stop or delay projects > Change the story of coal: change the perception of coal and gas as backbone of the economy > Create investor uncertainty: create perception of risk over fossil fuel investments > Create a powerful link in the public mind between coal , gas and health problems The accidently infamous Curtis Island…. World Heritage Committee meeting (Paris, June 2011) Advice from Australia of approval for GLNG project on Curtis Island seemingly misinterpreted: ‘The World Heritage Centre and IUCN recall the Committee’s position that exploration and development of oil and gas should not take place within World Heritage properties, as recognised in leading industry commitments to not explore for, or develop, oil and gas resources in natural World Heritage properties.’ What difference a map might have made to the understanding of the Australian advice – or would it? Curtis Island Coal-seam gas exploration and development 0 The anti-coal movement took its cue... ‘...build the anti-coal movement and mobilise off the back of the community backlash to coal-seam gas.’ ‘UNESCO has lodged a complaint to the Australian Government and will be inspecting the site in March 2012. What happens in Gladstone will have major implications which may limit other proposed new coal ports up the Queensland coast – all of which are also in the Great Barrier Reef Marine Park – and can help to mobilize a powerful constituency to protect the Reef from the impacts of the coal boom.’ UNESCO monitoring mission report sets the stage... ‘...the current approach to the development and construction of Gladstone Harbour and on Curtis Island are not consistent with the highest standards of best practice, commensurate with status of an iconic World Heritage property, and those applied to other management challenges both within and outside World Heritage property’s (sic) in Australia.’ (2012 Reactive Monitoring Mission report) ‘The project (Fight for the Reef) is run jointly by WWF and the Australian Marine Conservation Society is a coalition initiated by the (Thomas) Foundation.’ Social media declares GBR Marine Park dead in 2013 Where’s the science? QRC pushing back with facts REEFVTS 24/7 ship monitoring, Townsville ‘Get the facts’ focus of TV advertising www.reeffacts.qld.gov.au Changing the story of gas The Australia Institute (founding member anti-coal movement) ‘Fracking the Future’ ‘What Australians don’t know about CSG’ ‘$2.9 billion CSG surcharge’ ‘Cooking up a price rise’ ‘Mining the age of entitlement’ It should be recognised that The Australia Institute (TAI) is part of a wider movement to stop coal and coal seam gas development in Australia – a movement that includes Greenpeace and Beyond Zero Emissions, so its motives are clear. APPEA statement, March 2014 Creating investor uncertainty Creating a link between gas and public health ‘Locals are doing everything they can to spread the word about the dangers of coal seam gas (CSG) mining. Debbi, a GetUp! member from Tara QLD, even drove 5 hours down to NSW to tell a community meeting what coal seam gas is doing to her kids' health.’ Count on the debate intensifying... debate the on Count State of play and next steps with the Reef > June 2014 - WHC welcomes progress by Australia on management of GBR but ‘in- danger’ listing still a threat for June 2015 meeting > End 2014 – Long Term Sustainability Plan for GBR finalised and submitted to WHC > December 2014 – first gas exports from Gladstone will attract ENGO focus > Ongoing – ENGO campaign to demonise ports, dredging and shipping as key threats to GBR health; other anti-coal and gas tactics will continue to be pursued > Ongoing – QRC and other industry campaigns to highlight facts and science > First half 2015 – possible Abbot Point Stage One dredging > June 2015 – WHC meeting will consider possible GBR ‘in-danger’ listing. Huge implications for future approvals e.g. further Gladstone dredging QUPEX Lunch meeting 8 July 2014 Queensland’s energetic future Michael Roche Chief Executive .