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October 16, 2008


Australian resource industry divided over port takeover plans

It is reported that the Australia resources industry has welcomed further funding of the Australian ports by the Federal Government but is divided over whether a Commonwealth takeover would be beneficial.

Mr John Howard prime minister of Australia had recently indicated that the Commonwealth could step in to ensure the Australian ports run more efficiently if the states do not implement urgently needed reforms. He said that the government has explained to the states that the better management of the ports is essential to ensure there are fewer blockages and guarantee Australian export performance.

The Queensland Resources Council said that the Federal Government should commit more funding if it is unhappy with the performance of the state's coal ports. Mr Michael Roach spokesman for Queensland Resources Council said that there is billions of dollars of expansion projects due to start or be finished which could be achieved sooner with federal funding.

He added that it is unlikely the Federal Government would be able to takeover some of the state's coal ports. He said ‘We have coal export ports owned by BHP, is the Federal Government going to take over BHP's coal export port? I think not. We have coal export ports operated by Babcock and Brown is the Federal Government going to take over Babcock and Brown's 99-year lease? I suspect not."

Mr Vincent Tremaine CEO of Flinders Ports says a federal takeover could speed up reform. He added that if you remove the worst of the regulatory regimes then you allow market forces to come into play, and market forces will get the job done a lot faster than regulatory regimes will. He also added that federal intervention is not needed in South Australia. We've got a fairly light-handed regulatory regime, so it's not really necessary for substantial changes here. Mr Vincent said "However to the extent that the Federal Government is looking at reducing the regulatory regime and allowing market forces to operate then I think that would be a good thing."