Global Warming Irony  

In another example of the fossil fuel industry getting bitten by the effects of global warming, Macarthur Coal is worried that coal production may have to be cut as a result of water shortages.

Macarthur Coal's managing director, Ken Talbot, has warned that water supply will become increasingly important to the viability of the Bowen Basin coal industry if summer rains fail to materialise.

An extended dry period has stretched the supply to its limit, and Mr Talbot said delays in the building of a $210 million pipeline from Burdekin Falls Dam to the northern Bowen Basin could be critical to the industry. He warned that without full rains this summer, Bowen Basin production might have to be cut by 10 million to 50 million tonnes next calendar year.

Mr Talbot, whose mines are at the northern end of the Bowen Basin in central Queensland, has called for the pipeline project to be accelerated. "This is a very important piece of infrastructure and unfortunately it has taken longer than what we could have liked," he told a Brisbane Mining Club function. "When that happens, the viability of our industry is at some risk. We'd expect that pipeline would be in place by the end of 2006 or earlier if we can possibility achieve it."

The coal industry extracts about 120 million tonnes of coal a year from the Bowen Basin. Coking coal, such as that produced by Macarthur's Coppabella and Moorvale mines, needs to be washed to prepare it for market.

It has three framework agreements in the US, Spain and Germany which the company said were key to medium-term growth. Future acquisitions under these agreements were not included in the forecasts.

Babcock & Brown has arranged financing for more than 3000 megawatts of wind energy projects and companies at an estimated value of $US3 billion ($3.96 billion) over the last 16 years.