Comments on John Quiggin, John Rolfe, Martine Maron and Samantha Hepburn "Controversial Watermark coal mine approved for New South Wales: experts respond", 11/07/2015
There seems some potential errors, inconsistencies, confusion or something that may need clarification in the article and the introduction, otherwise they may be misleading. For example, in the introduction, there is the following paragraph:
"In an economic analysis the mine, proposed by Chinese mining company Shenhua, was valued at A$1.3-1.6 billion. The mine is expected to produce up to 10 million tonnes of coal each year over the its 30-year lifetime."
What does the value of A$1.3-1.6 billion mean, given John Quiggin states that the company's analysis was based on a coal price of A$140 a tonne? It is inconsistent with the sentence following it, that is, up to 10 million tonnes of coal each year over the next 30-year lifetime. What does 10 million tonnes coal value and how much the total would be for 30 years of production at that level?
Secondly, in the section of John Rolfe, the very first sentence reads "The potential development of the Shenhua coal mine for coal-fired power plants in China expose the differences between aspirational goals and what is happening in reality." That sentence is also misleading in connection with what was followed and also in terms of China's commitment to emissions targets and its energy use/growth.
China has committed to reduction in its fossil fuel intensity of GDP very significantly by 2020 and by 2030. It also commit to the target of peak fossil fuel use or emissions by 2030. They are very ambitious targets. Those target can be seen by the presentation of an energy expert and adviser to the Chinese government at the recent China Update (10/07/2015) at the ANU. It may also be in the book that the China Update released/published as the main outputs of this year's update. Those commitment, however, do not conflict or contradict to some absolute increase in its fossil fuel use by 2030.
In the third paragraph in that section, the following sentence is also misleading and does not reflect accurately what China has committed to as I have outlined above :"The World Energy Outlook 2014, summarised by Ian Cronshaw, predicted that total global energy use will increase by almost 40% to 2040." I assume it is about to say China's energy use and particularly emissions to increase too. In contrary, China has committed to the target of peaking of its fossil fuel use by 2030, meaning its fossil fuel use will not increase after 2030. The mention of 2040 confuses the readers.
The fourth paragraph is itself contraction with each other in logic: "While the share of renewable energies grows, and the share of fossil fuels falls over that time period, the absolute share of fossil fuels is predicted to increase." What does it mean when the share of fossil fuels falls and the 'absolute share' of fossil fuels is predicted to increase? It is illogical.
The following paragraph is also confusing in the context of the mining will have a lifetime of 30 years (as opposed to China's commitment to reduce emissions absolutely from 2030) and the commission of the mining is at least a few years away:
"Would the development of the Shenhua coal mine lead to an increase in global greenhouse emissions? The answer depends on whether the coal contributes to a growth in coal consumption, or whether it is part of the substitution story. Both scenarios are plausible but uncertain."
While John Quiggin's broad analysis is appealing, there is also some confusion in his section. For example, the second paragraph reads: "This is based on the high price for metallurgical coal that prevailed when the project was proposed. The boom in such coal derived from a massive multi-year construction boom experienced in China. In the last two years of construction the boom, has slowed and there is now a substantial risk of a disorderly collapse."
What does the last sentence mean? Isn't it confusing, at say the least? This mine has not started yet, has it? The author and/or the editor have left the readers with confusion.
In the section with Martine Maron, we can see the high arts of an environmentalist for doing nothing and allowing nothing to change, as reflected in the following paragraph:
"The Shenhua offset proposal does a bit of both: it plans to restore woodland and protect some existing habitat. The bottom line is that clearing 771 hectares of woodland means there will be even less of this threatened ecosystem than there was before. Offsets can help, but the only sure-fire way to recover threatened ecosystems is to avoid losing them the first place."
The reading of the last section with Samantha Hepburn also further reinforce the ambiguity the authors use to cause confusion.
After argument back and forth including "The approval includes strong water usage conditions – Shenhua is only entitled to use 0.09% of available groundwater; it must complete water, biodiversity and rehabilitation management plans prior to mining and any impact on groundwater allocated for agricultural purposes; it must complete annual compliance updates and; should an impact on agricultural interests be proven, would be required to provide compensation."
Then it ends with the following paragraph:
"The jobs, economic growth and community funding generated by Shenhua, including for example, an upgrade of the maternity ward of the Gunnedah hospital, donations to aged care and renovations to the Gunnedah town hall are important but cannot act as a substitute for rigorous protection of a groundwater system that supports such a strong and established agricultural industry."
Readers are left with impressions that the mine should probably not go ahead.
PS: I think the feasibility of the mine is highly questionable, given that the analysis of the mine by the applicant was based on very high coal prices that have been a past thing and now the coal prices are much lower than those. Although it is likely that coal prices will bounce back higher, it is unlikely to see its high days in the past. China's economy has been in transition and its future demand for coal is also unlikely to be as predicted in the past when the Chinese economy was red hot with annual growth was double digits. Further, as some of the experts stated, there are also hurdles for the applicant to get over before it can plan when to start the mining, should coal prices can be high enough for the mine to open. It can be years away assuming the applicant is still interested in moving forward with the mining project.