The Hunter coal industry faces further investment uncertainty in relation to one of Australia’s important export gateways following an announcement in November of further legal action appealing against a competition body’s decision regarding pricing at the Port of Newcastle.
The Australian Competition Tribunal in October determined the appropriate price that should apply to coal ships accessing the Port of Newcastle.
The Tribunal – which comprises a Federal Court judge and experts in industry, commerce, economics, law and public administration appointed by the Governor-General – is the review body called upon to re-consider and rule on such competition matters.
The Tribunal’s decision, which ended a four year legal battle initiated by global mining giant Glencore, noted the importance of ensuring that prices be at a level that provides an incentive to a service provider to efficiently (and in a timely fashion) invest in maintaining and improving infrastructure necessary to provide facilities at the Port.
The Tribunal expressed concern that prices that are too low could lead to non-investment or delayed investment, or the non-provision of some infrastructure services.
It follows the Australian Government’s announcement in September regarding the revocation of the declaration of service at the Port of Newcastle, which ended a period of unnecessary uncertainty for all parties and enabled the port to deal directly with its users.
However, both the Australian Competition and Consumer Commission and Glencore each commenced separate but overlapping appeals in Melbourne and Sydney in the Federal Court against the competition tribunal’s decision.
Port of Newcastle CEO Craig Carmody said it was disappointing to see further uncertainty for everyone.
“Port pricing should remain subject to an appropriate and efficient commercial relationship between the port and its customers,” Craig said.
“The endless legal battles erode confidence in investing in infrastructure, be it at the mine or at the port, in one of Australia’s most important export industries.
“We will continue to sit down with our customers to discuss our services and pricing, respecting the need for all parties to return to a normal commercial relationship,” he concluded.
IMAGE | Newcastle’s famous harbour, which is home to the Port of Newcastle
