2015 Broken Hill Resources Investment Symposium - Coal and the future anti mining movement - Josh Euler
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KEYNOTE PRESENTATION: Coal and the future anti mining movement. Speaker: Josh Euler, General Manager External Affairs, GVK Hancock Coal Pty Ltd
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2015 Broken Hill Resources Investment Symposium - Coal and the future anti mining movement - Josh Euler
- 1. Coal and the future anti-mining movement Josh Euler General Manager External Affairs Resource and Investment Symposium - 2015 25 May 2015
- 2. 225 May 2015 Resource & investment Symposium – Broken Hill 2015 Galilee Basin Coal Projects
- 3. 325 May 2015 Resource & investment Symposium – Broken Hill 2015 Favourable Geology and Large Resource ● Four economic coal seams, varying in thickness from 4m to 8m ● All seams dip gently (0.5o to 2o ) from east to west, no major dislocating structures ● Our coal assets are in the shallowest part of the Galilee Basin Dept h 16m 43m 52 m
- 4. 425 May 2015 Resource & investment Symposium – Broken Hill 2015 Sought after coal quality
- 5. 525 May 2015 Resource & investment Symposium – Broken Hill 2015 Rail Infrastructure Development 300km 500km Staged SolutionStaged Solution Full ScaleFull Scale
- 6. 625 May 2015 Resource & investment Symposium – Broken Hill 2015 Port – Abbot Point expansion – T3
- 7. 725 May 2015 Resource & investment Symposium – Broken Hill 2015 Dredging myths Townsville Mackay Bowen Great Barrier Reef
- 8. 825 May 2015 Resource & investment Symposium – Broken Hill 2015 Environmental Assessments ● Tens of millions of dollars on extensive and rigorous environmental assessments. ● Our environmental assessments have included around 300 collaborative scientific studies and over 500 specialist consultants. ● We have complied with every environmental obligation outlined by the State and Federal governments.
- 9. 925 May 2015 Resource & investment Symposium – Broken Hill 2015 Anti-mining protestors
- 10. 1025 May 2015 Resource & investment Symposium – Broken Hill 2015 Social Media
- 11. 1125 May 2015 Resource & investment Symposium – Broken Hill 2015 Social Media
- 12. 1225 May 2015 Resource & investment Symposium – Broken Hill 2015 Campaign of misinformation
- 13. 1325 May 2015 Resource & investment Symposium – Broken Hill 2015 Disrupt and Delay tactics Unfortunately, anti-mining activists are intent on taking their campaign beyond mere misinformation. “Our strategy is to ‘disrupt and delay’ key projects and infrastructure while gradually eroding public and political support for the industry and continually building the power of the movement to win more.” Stopping the Australian Coal Export Boom – Funding proposal for the Australian Anti-coal Movement
- 14. 1425 May 2015 Resource & investment Symposium – Broken Hill 2015 The real reason GreenpeaceGet Up Australian Youth Climate Coalition
- 15. 1525 May 2015 Resource & investment Symposium – Broken Hill 2015 The real reason World Wildlife Fund Australian Marine Conservation Society
- 16. 1625 May 2015 Resource & investment Symposium – Broken Hill 2015 The real reason Annual income from donations Past income Recent income Increase GetUp $1,673,809 (08/09) $7,534,453 (13/14) 450% WWF - Australia $17,205,737 (2010) $29,844,610 (2014) 73% Australian Marine Conservation Society $95,009 (2010) $1,019,543 (2013) 1073%
- 17. 1725 May 2015 Resource & investment Symposium – Broken Hill 2015 The battle fronts ● Environmental impacts ● Economic viability ● Divestment ● Legal challenges
- 18. 1825 May 2015 Resource & investment Symposium – Broken Hill 2015 PR Solution ● Facts vs Activist Lies ● Activist campaigns are emotive ● They tend to over-reach ● All have a hidden weak point and come in waves ● Keep key stakeholders and media well briefed ● Proud of our actions
- 19. 1925 May 2015 Resource & investment Symposium – Broken Hill 2015 Thank you
- 20. 2025 May 2015 Resource & investment Symposium – Broken Hill 2015 Important Notice - Disclaimer DISCLAIMER – IMPORTANT NOTICE This presentation ("Presentation") has been prepared by GVK Coal Developers (Singapore) Pte Ltd Company No. 201115929C on behalf of its affiliated companies (“Company”) to provide an update on the development of the project. As a condition to accepting the Presentation, each recipient accepts the terms and conditions set out in this Presentation and agrees to keep the Presentation and the contents of the Presentation confidential. If the terms and conditions contained in this Presentation are not acceptable to a recipient, the Presentation and any copies in the recipient's possession must be returned to the Company immediately. The Company retains ownership of the content of the Presentation. The Presentation has been prepared as at 25 May 2015. The purpose of the Presentation is to provide general information regarding the current status of the project. It is supplied to the recipient on the basis that it is not to be used for any other purpose. The Presentation is not to be reproduced, transmitted, made available or discussed with any other person without the prior written consent of the Company. This Presentation is for the Recipients' information only and does not constitute an offer to sell or a solicitation of an offer to purchase any securities or financial products, nor does it constitute an offer or solicitation in any jurisdiction in which such offer or solicitation would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any jurisdiction. The information contained in this Presentation is not for publication, release or distribution in any jurisdiction, including in Australia, Singapore, the United States, Canada, Japan, Korea or the PRC. The Recipient is solely responsible for complying with any laws and regulations of the jurisdiction in which they reside or receive the Presentation. This Presentation does not purport to contain all of the information that a recipient may require to form a view in relation to the project. Each recipient should take its own professional advice where necessary. Nothing in this Presentation should be relied on as the giving of financial product or other advice. By accepting this Presentation, each recipient acknowledges that it is solely responsible for its own assessment of the information contained in the Presentation and that each recipient will conduct its own analysis and due diligence and be solely responsible for forming its own view in respect of that information. This Presentation contains certain forward-looking statements, including assumptions, opinions and views. These may involve elements of subjective judgement and analysis which may or may not be correct. Various known and unknown risks, uncertainties and other factors could cause the actual results, financial position, development or performance to differ materially from the estimations expressed or implied in the Presentation. Neither the Company nor any officers, directors, employees, advisers, agents or associates of the Company ("Agents") guarantees that the assumptions underlying such forward-looking statements are free from errors, nor do such persons accept any responsibility for the future accuracy of the opinions expressed in this Presentation or the actual occurrence of the forecasted developments. Where any information and statistics are quoted from any external source, such information or statistics should not be interpreted as having been adopted or endorsed by the Company as being accurate. This Presentation has not been and will not be independently verified or audited. The Company makes no representation or warranty that the information contained in this Presentation remains correct at, or at any time after, the date this Presentation was prepared. The Company does not accept any responsibility to update, supplement or correct the Presentation or inform the recipient of any matter arising or coming to their notice which may affect any matter referred to in this Presentation. The Company may decide in its absolute discretion to update or supplement the Presentation. Any further information will be provided subject to these terms and conditions. To the maximum extent permitted by law, no representation or warranty (express or implied) is made, or undertaking (express or implied) is given, as to, and no reliance should be placed on, the fairness, accuracy, adequacy, reliability, authenticity, reasonableness or completeness of the information contained in the Presentation or any information subsequently provided to a recipient by or on behalf of the Company in relation to the project. Accordingly, to the extent permitted by law, none of the Company or any of its Agents accepts any liability whatsoever (whether in negligence or otherwise) arising directly or indirectly from the use of, or in connection with, this Presentation, or in relation to any statements, opinions, information or matters (express or implied) arising out of or contained in or derived from this Presentation. Each Recipient will at the request of the Company at any time, return, as soon as practicable, the Presentation together with any reproduction of it and any material relating to it that the recipient may have received from or on behalf of the Company, or at the election of the Company, destroy such information (including computer based information) and confirm in writing that all such information (including computer based information) has been destroyed.
Editor's Notes
- Today I am going to give you and overview of our Galilee Basin Coal projects as well as the activist campaign aimed at delaying our projects. To that end our projects are a good case study for the industry to gain insight into how activists have morphed from almost hobby groups to professional campaigns.
- We are developing three world-class coal deposits in the Galilee Basin with a total JORC Resource of around 8 billion tonnes of high quality thermal coal – Alpha, Kevin’s Corner, Alpha West deposits Our mining operations will be some of the largest operating mines in the world with a life of mine of around 30 years. We have agreements to purchase or compensate 100% of properties within the mining lease and compensation agreements in place with those properties surrounding our proposed mines. Alpha Alpha is a full open cut mine that will produce around 32 mtpa over 30 years It is our most advanced project and currently our main focus and a project of State Significance. It offers favourable geology with its four principle seams dipping gently from east to west and varying in thickness from 4-8 metres making them suitable for high-production, low-cost open cut mining. Kevin’s Corner Will be a mix of open pit and underground mining Will produce up to 30mtpa over 30 years Running about two years behind Alpha Alpha West is currently under exploration and will be an underground mine with an estimated production of around 16-24 mtpa over 30 years.
- [Point out the Alpha Pit] As can be seen from the graph and image, our resource offers a large, shallow, relatively flat grouping of seams. These are key driving factors that ensure our projects remain viable in tough market conditions: Very large asset - Economies of scale plays a key role Very flat delineation - dip gently between 0.5 to 2 degrees Shallowest part of the Galilee Basin - four economic coal seams, varying in thickness from 4m to 8m Relatively soft overburden – significant reduction in blasting costs All of these features allow for the use of large-scale mining techniques, which dramatically reduce production costs
- In 2011, 125,000 tonnes of coal was extracted from the Alpha coal Test Pit The test pit was the first and is still the only production and export of coal from the Galilee Basin. The coal was sent for test burning in power stations in China and South Korea. The test pit results validated that the type of coal we have in the Galilee is sought after by Asian markets. The test burns showed that our Galilee Basin projects present an opportunity to access a low cost, low ash, low sulphur, high quality thermal coal, which will offer the ability to lower global emissions from coal fire power generation.
- We have known about the deposits in the Galilee Basin for many decades now, however transport to export markets has always been a challenge. We believe we have overcome that challenge with our proposed JV with Aurizon. In November 2013, we reached alignment with Aurizon on major items such as a rail solution and commercial terms for the proposed transaction including: governance, timing of milestones, Funding; and conditions for completion. The proposed staged rail solution means that for an initial stage, only 300km of the 500km of new corridor and track under the original GVK Hancock proposal will be constructed before connecting into existing Aurizon infrastructure. This will also allow a phased capital investment to match volumes and ramp-up, thereby materially reducing the initial cost of infrastructure. The development of our rail line has received: State environmental approval (May 2012) Federal EPBC approval (August 2012) Galilee Basin State Development Area (16 June 2014)
- Our port facilities involve the expansion of the existing port facilities at Abbot Point Port. It will include: 2.1 Mt stockyard capacity Deepwater vessel approach Large Capesize vessel berthing capacity - 220,000 (DWT) Fast vessel turnaround This expansion is in line with the Qld Govt’s Ports Strategy as a Priority Port Development Area There have been some outlandish claims made about this port expansion impacting the Great Barrier Reef. This is simply not true. Dredging is over 50 kms away from the reef and will not impact the outstanding universal value of the Great Barrier Reef There is currently an assessment underway for the relocation of dredge spoil to onshore within port boundaries and we will continue to work with all parties to undertake this assessment.
- Proposed dredging facts: Over 50kms away from any reef Now only around 2 million cubic metres Only localised and temporary impacts In contrast the Burdekin river catchment naturally produces around 15 million cubic metres of sediment which actually reaches the reef There was over $2m invested in environmental assessments to identify and limit impacts for the Port dredge campaign It received approvals from all levels of government. Activists are opposed with no scientific evidence, but a strong emotive PR campaign. We are now assessing onshore dredge spoil relocation to within the Port boundaries.
- We’ve invested tens of millions of dollars on some of the most extensive and rigorous environmental assessments for our Galilee Basin projects and associated infrastructure, which formed the basis for our approvals from State and Federal governments. Our environmental assessments have included around 300 collaborative scientific studies and over 500 specialist consultants. We have complied with every environmental obligation outlined by the State and Federal governments. All of these studies have been focussed on us attaining our Environmental Authority, which is essential to attain prior to gaining your Mining Lease. In fact, our Alpha Coal Project is the only project in the Galilee Basin to have received an Environmental Authority.
- It was clear that developing a new coal basin would draw the attention of green groups, and it clearly has. Their opposition has been relentless. So much so, it makes you wonder how such a sustained campaign could occur without funding.
- We have witnessed some outstanding portrayals of misinformation throughout the campaign. [talk to slide]
- [talk to slide]
- The larger activist groups have taken this ten steps further and have shown complete disregard for facts. These activist groups are unfolding a Campaign of Misinformation around the development of the Galilee Basin Much of the material has gone well beyond the weekend warrior type of approach from activist groups. [go through the images] It kind of begs the question, why would these groups so actively spread such lies and misinformation. The answer is quite simple – and it’s not just out or their environmental conscience.
- [Read from slide] This strategy outlines budget for legal challenges, and PR consultancies to attack Australia’s second largest export industry. But it is much more than just a strategy, which allocates and spends money, it has been fused together with a fundraising campaign.
- Anti-mining activists have discovered that saying “Save the Reef” makes money. All they need to do is create hysteria and then ask for funds from the public. As you can see from this slide, each of these groups have dedicated web pages designed to quickly and easily extract money from easily influenced people.
- WWF and AMCS are easily the most entrenched fundraisers. These groups have engaged a professional PR consultancy to run their “Fight for the Reef” campaign to lead the fundraising efforts. But I suppose the question is have they actually had any success with their fundraising initiatives.
- As can clearly be seen from this slide, the answer is a resounding yes. It is quite clear to see why these groups are investing so much time and effort to continue their campaign of misinformation. It is clearly very lucrative! So don’t expect the misinformation to end. The disappointing fact is that despite all the claims about reef it appears that none of this fundraising is being contributed to environmental initiatives on the Great Barrier Reef. It is also disappointing that the local tourism industry is now feeling the pain from the activists campaigns, with latest stats showing that the international hysteria is impacting tourists’ desire to come to the area with reduced numbers to NQ.
- Environmental impacts activist groups – GetUp, Greenpeace, WWF, AMCS, Conservation Council – these groups have their workers parachuted within local green groups are funding scientists to answer economic questions Economic viability IEEFA (Institute for Energy Economics and Financial Analysis)– we’ve seen the groups that purport to be analysts giving media commentary to talk down the coal industry Divestment Market Forces – a group has been specifically set up to run a divestment campaign attacking banks that fund coal projects to stop or “face the consequences” of a sustained PR campaign against them Legal Challenges This is where the campaign goes beyond a PR battle and into actual impacts that delay development in our state. Our mine is being challenged by a 99c front company, which offers us no possibility of recouping costs
- Facts vs Activist Lies It is absolutely vital that we remain factual. In the end the truth always comes out, and we will do ourselves a dis-service to step outside of the facts. Activist campaigns are emotive It is important to keep a level head, don’t be drawn down to their level. They tend to over-reach We have witnessed groups stepping over legal lines in the Corporations Act and even committing trespass and fraud. Always outline the truth. All have a hidden weak point and come in waves This is where you really need strategic PR direction. Find the weak point, prepare for the wave and unfold the appropriate comms. Keep key stakeholders and media well briefed We’ve invested a lot of time briefing key media outlets on facts surrounding our projects. Nearly every time I provide a background brief to journalists I hear the words “damn, those greenies lied to me” Direct briefings and material can go a long way to Proud of our actions Over the length of a sustained campaign against you it is easy to let doubt creep in. We have to remain proud of what we do. And we have every right to be proud. After all look at all we offer. - Regional development Remember, an external perspective is not just created on what we say, but how we say it.