A research report released today titled ‘Victoria’s Coal Wannabes’ finds that none of the companies seeking government grants or coal allocations to develop Victorian brown coal export projects have any existing commercial coal operations, and many of the companies have financial difficulties or are verging on insolvency.
It is expected that the State and Federal Governments will announce within weeks $90 million in funding under the Advanced Lignite Demonstration Project (ALDP) for companies seeking to build pre-commercial scale brown coal projects in Victoria. The Victorian Government is also currently considering allocating 13 billion tonnes of coal from the Latrobe Valley’s unallocated coal resources – the equivalent of 13 mines the size of Hazelwood mine.
The report ‘Victoria’s Coal Wannabes: A report profiling the companies seeking government grants and coal resources for Victorian brown coal projects’ was written by author Bob Burton and commissioned by Environment Victoria. It is based on a forensic analysis of the Annual Reports, audited financial statements and public statements of nine of the companies known to be seeking cash and coal handouts from the Victorian and federal governments.
Environment Victoria Campaigns Director Mark Wakeham said today:
“This research finds that most of the companies lining up for cash and coal handouts have never built a commercial project and have very little capital behind them. If the cash grants go ahead Victorian taxpayers will be bankrolling the coal pipe-dreams of a handful of speculators.”
“In some cases any cash grant to companies will end up directly in company directors’ pockets with board members giving themselves bonuses if their company receives a government grant.”
“The same companies seeking taxpayer-funded cash handouts are also behind the Napthine Government’s decision to consider an allocation of 13 billion tonnes of Latrobe Valley coal. An announcement is expected before the end of the year from Minister Ryan about the status of the proposed coal allocation.”
“Given the tenuous financial status of these companies the most likely outcome of any cash or coal handout is that the promised projects never proceed and a few coal executives profit at the taxpayers expense. This has proven to be the case in past coal and cash handouts in Victoria with not one project being developed from the last coal allocation.”
“However if governments are reckless enough to hand over enough taxpayer cash and coal, and they also bankroll infrastructure like a coal port at Westernport or Corner Inlet, Victoria could very well end up with new coal mines and a polluting export industry at exactly the time we need to be cleaning up our economy.”
“Handing over taxpayer-funded grants to coal companies is ill-advised and not in the public interest. Handing over billions of tonnes of brown coal would be a disaster, creating massive uncertainty for landholders in the Latrobe Valley and opening the door to dozens of new coal mines and a polluting new export industry.”
“Its time for the Napthine Government to get serious about supporting the smart, clean businesses of the future in regional Victoria rather than continuing its obsession with an outdated, polluting and environmentally damaging energy source.”
Selected findings from Victoria’s Coal Wannabes: A report profiling the companies seeking government grants and coal resources for Victorian brown coal projects:
 Environmental Clean Technologies, Half Year Financial Report – As at 31 December 2012, February 2013
 Ignite Energy Resources, “Current & Historical Company Extract”, September 5, 2013.
For further information or comment
Mark Wakeham, Environment Victoria Campaigns Director, 0439 700 501