Started by Fares_Fair, November 23, 2011, 10:58:45 AM
QuoteControllers responsible for Queensland's coal-hauling railway walked off the job last night amid a breakdown in talks with the monopoly operator, Aurizon, in a move that could threaten Australia's reputation as a reliable supplier of coal to Asia.Aurizon was last night planning to ride out the dispute with the Rail Tram and Bus Union, urging the 60 controllers at the centre of the dispute to vote for an enterprise agreement on Monday that will see their real wages reduced over four years.The work stoppages are due to run until Wednesday. Liberal National Opposition Leader Deb Frecklington demanded the state Labor government use its legal power to bring the strike to an end. The Palaszczuk government said it did not have the legal authority as Aurizon's workers were covered under the federal industrial relations regime, a claim last night contested by the LNP. Federal Workplace Minister Craig Laundy has declined to get involved in the dispute for now. A spokesman urged the parties to return to the negotiating table. RTBU president Bruce Mackie urged the LNP to contact their "mates at the top end of town" and tell them to treat workers with respect.Aurizon insisted the company had been negotiating "in good faith" and was recommending workers accept its proposed offer in a ballot on Monday. This would make any strike action illegal. The offer includes a real wage cut — an annual 2 per cent rise against inflation averaging 2.4 per cent — and changes to conditions that would "better align to competitors and industry". "Aurizon is encouraging the RTBU to allow their members time to reconsider the proposed offer," Aurizon's spokeswoman said.
Quote from: ozbob on July 09, 2018, 14:17:49 PMThe Australian --> Aurizon won't budge as rail controllers walk outQuoteThe work stoppages are due to run until Wednesday. Liberal National Opposition Leader Deb Frecklington demanded the state Labor government use its legal power to bring the strike to an end. The Palaszczuk government said it did not have the legal authority as Aurizon's workers were covered under the federal industrial relations regime, a claim last night contested by the LNP. Federal Workplace Minister Craig Laundy has declined to get involved in the dispute for now. A spokesman urged the parties to return to the negotiating table. RTBU president Bruce Mackie urged the LNP to contact their "mates at the top end of town" and tell them to treat workers with respect.
QuoteThe work stoppages are due to run until Wednesday. Liberal National Opposition Leader Deb Frecklington demanded the state Labor government use its legal power to bring the strike to an end. The Palaszczuk government said it did not have the legal authority as Aurizon's workers were covered under the federal industrial relations regime, a claim last night contested by the LNP. Federal Workplace Minister Craig Laundy has declined to get involved in the dispute for now. A spokesman urged the parties to return to the negotiating table. RTBU president Bruce Mackie urged the LNP to contact their "mates at the top end of town" and tell them to treat workers with respect.
QuoteBHP has called for the Government to legislate future powers to enable Queensland Competition Authority to bring Aurizon to heel.The mining industry has claimed Aurizon has a gun to the head of coal companies in the dispute that threatens up to $4 billion in coal exports, but it's the first time since the introduction of the mining tax by the Rudd government that the industry has rallied to fight off a threat. Asset president of BHP's coal joint venture in Queensland Rag Udd said Aurizon was "applying duress to our customers'' and that the issue was at an impasse with neither side willing to budge."Aurizon will need to reconsider its position because the likelihood of coal companies sitting down to negotiation under duress is slim to none,'' Mr Udd said. The stalemate should not occur when prices for coal were at high levels and capable of generating billions of dollars for the coal producers and the State Government through royalties, he said.An estimated 20 million tonnes of coal exports are threatened by an Aurizon decision to alter its maintenance of the central Queensland coal network. That strategy followed draft decision from the Queensland Competition Authority drastically reducing the amount of revenue Aurizon could make from the monopoly track. "In this market is that where Queensland wants the coal industry sitting? Particularly given the ability to bring forward revenue and taxes, I suggest we would be much better placed to be at the other end of the spectrum,'' Mr Udd said. "It's probably going to take a bit of give and take (to solve this). I do think that the powers that are necessary to ensure these things don't happen in the future are vital for us.'' He said BHP would consider moving some of its freight away from Aurizon when contracts expired. Aurizon said it took its regulatory responsibilities very seriously. "Aurizon has been on the public record countless times saying the current regulatory process is excessively late, overly bureaucratic and lacking commercial orientation,'' a spokesman said. A State Government spokeswoman said all parties should focus their efforts on working towards an outcome within the existing regulatory framework. "Once the current process is concluded, government will consult with parties about ways the process could be improved," she said.
QuoteTHE State Government is under increasing pressure to step into the Aurizon controversy after another mining giant backed the need to rein in the company to prevent it from impacting future Queensland coal exports.Earlier this week, BHP Mitsubishi Alliance asset president Rag Udd said legislation had to change to give power to the Queensland Competition Authority to be able to force Aurizon to change its practices if they were hurting exports.Anglo Coal chief executive Tyler Mitchelson said Aurizon's actions had been completely unacceptable."At some point, there does need to be a review of the regulatory framework to ensure this situation is prevented from ever happening again. To have a monopoly network and react the way they have, hurts the industry, it hurts the state and it hurts the country,'' Mr Mitchelson said."For the industry to consider areas of common ground with Aurizon, as is permitted within the regulatory process, they must cease using maintenance practices as a negotiating tactic."LNP leader Deb Frecklington said Premier Annastacia Palaszczuk had gone missing on the Aurizon issue."We believe there are fundamental flaws with the current legislation and it needs to be fixed as a priority," Ms Frecklington said."It's clear that this has dragged on for far too long and Annastacia Palaszczuk has been missing in action."Queensland Resources Council chief executive Ian Macfarlane said his group had told the Government there needs to be legislative safeguards "so this sort of economic vandalism by Aurizon cannot be attempted again in the future"."We need a resolution to the current impasse first and foremost, but reform is needed and there is acceptance of that on both sides of politics," Mr Macfarlane said.Aurizon altered its maintenance practices on the monopoly central Queensland coal network earlier this year to combat a draft decision from the QCA restricting the revenue the company could earn.Those maintenance changes could affect up to 20 million tonnes of $4 billion of coal exports. However, there is so far no noticeable impact at the ports which continue to report record coal levels.The State Government has said it will wait until the QCA process is over before consulting about ways the process could be improved.
QuoteIN a formal sense the brawl between Aurizon and its customers, the coal mining industry, is about technical issues with obscure acronyms and arcane financial theories.But really what it boils down to is a company wanting to make more money than it's allowed to under a regulated system imposed when the State Government privatised the QR freight business in 2010.For the coal miners it is very much a fight to the death to ensure that never happens because they would be the ones paying that extra money. And they point out that they would never have agreed to the privatisation if Aurizon wasn't regulated.The issue has reached the top of the Japanese Government which had serious concerns about the reliability of Queensland to deliver coal to its steel mills, two of which have admitted they could go elsewhere if things are not resolved.There's little doubt that when Andrew Harding first walked into the Brisbane offices of Aurizon as its chief executive in late 2016, breaking down the regulated system was high on the agenda for him and there are those in the mining industry who believe the current brawl is about destroying the system rather than reforming it.If we take Aurizon's submission to the regulator, the Queensland Competition Authority (QCA), as a guide then the cost of Aurizon being in a regulated system is about $1 billion over four years. That's the difference between its submission on how much it should earn and how much the QCA thought was a reasonable return for the Central Queensland Coal Network (CQCN) in its draft decision.It points out that the Newcastle system, which is regulated by the Australian Competition and Consumer Commission, is allowed a much greater rate of return and with possibly less risk.A few weeks after the QCA draft determination Aurizon announced it would radically alter its maintenance schedule on the network to save money and that would mean fewer trains would get to the ports. Ultimately the network would carry about 20 million tonnes less coal, which adds up to about $4 billion. The gamble at the heart of this is that Aurizon makes money by transporting coal, so the more coal the better and essentially what it is doing is cutting its own throat by carrying less.Worse, it's risking retribution from the likes of BHP, whose asset president for the Queensland joint venture company, BMA, Ragg Udd, said he would consider taking contracts away from Aurizon and potentially using the BMA's own trains."We have four trains that are operating on the network at the moment (BMA Rail)," Mr Udd said. "The fact of the matter is that it makes commercial sense to consider what are the options. Whether that's with another rail provider or doing it ourselves."On top of that, BHP and Anglo have both said that Aurizon has shown that the QCA needs enforcement powers or greater regulation to stop this happening every four years. That would not be good for Aurizon.Anglo Coal chief executive Tyler Mitchelson said Aurizon's actions had been completely unacceptable."To have a monopoly network and react the way they have, hurts the industry, it hurts the state and it hurts the country,'' he said this week.It's necessary to point out that companies like BHP and Anglo and Glencore don't usually wage war in public, but in this instance they are more than willing.The mining industry admits there is a need for reform of the QCA, certainly in streamlining the decisions it makes because at the current pace, Aurizon will get a final decision on the CQCN in September, maybe.That decision is backdated to July 2017 which is the technical start of the formal timing which would force Aurizon into some radical changes to cut costs or to tell its shareholders of the losses they are about to get hit with. And the mining industry is willing to talk, just not with those maintenance practices still in place, which it believes is a gun to it's head."That seems like a very odd way to start a conversation,'' Mr Udd said. He believes Aurizon's behaviour is an example of what would happen every time haulage contracts are negotiated outside the regulated system.Queensland Resources Council chief executive Ian Macfarlane said his group had told the Government there needs to be legislative safeguards "so this sort of economic vandalism by Aurizon cannot be attempted again in the future"."We need a resolution to the current impasse first, but reform is needed and there is acceptance of that on both sides of politics," he said.There is no doubt the State Government has to step in. Whether that's soon or after the QCA makes its final determination on the CQCN will be determined by just how heated this becomes.Treasurer Jackie Trad has carriage of the issue and while she is holding back from the joining the public flaying of Aurizon it's fair to say she is aware of the options she has before her.
QuoteThe competition watchdog has dragged rail freight giants Aurizon and Pacific National to court over an "understanding" that would have monopolised a crucial haulage route and substantially damaged competition on others.The Australian Competition and Consumer Commission alleged Thursday the two companies had reached an "understanding" to close some parts of Aurizon's intermodal freight business and sell other parts to Pacific National, which had the purpose or likely effect of lessening competition in the sector.'The effect of the understanding was that Aurizon would stop competing with Pacific National to supply intermodal and steel rail linehaul services throughout Australia," ACCC chairman Rod Sims said.The watchdog, which wants the Federal Court to block the sale and issue penalties, says Aurizon could have sold its intermodal business to another party, which would have been more competitive."The ACCC is aware of at least one alternative purchaser that is willing and able to acquire Aurizon's entire remaining intermodal business," Mr Sims said."The evidence makes it clear that it was more lucrative for Aurizon to agree to sell parts of its intermodal business to its closest competitor, and close other parts of that business, than it was to sell the whole intermodal business to a potential new entrant."Aurizon put its intermodal business - consisting of several components, including its Acacia Ridge Terminal - on the market in the first half of 2017, but terminated talks with other bidders after reaching the "understanding" with Pacific National in July that year, the ACCC alleges.That understanding involved Pacific National either buying the Acacia Ridge Terminal, or being awarded a long-term contract to operate the terminal if the ACCC blocked the sale, the watchdog alleges.Pacific National would also become the exclusive bidder for Aurizon's Queensland intermodal business, and that Aurizon would close that business if a sale was not completed, it says.Aurizon said publicly earlier this year that it would close the Queensland business if the ACCC blocked its sale, and closed its interstate intermodal business in December last year.These closures were the direct result of the "understanding" between Aurizon and Pacific National, according to the ACCC, which is seeking an interlocutory injunction to stop Aurizon closing the Queensland business until the matter is determined by the court.Aurizon said a statement that it "strongly refutes the ACCC allegations in today's decision and will vigorously defend the proceedings commenced by the ACCC".The total consideration for the sales was $225 million, Aurizon said.More to come ...
QuoteAdani's rail line to service its controversial Queensland mine should be in public hands and the Indian billionaire Gautam Adani should be paying for it, says former state under treasurer Sir Leo Hielscher.Sir Leo said he supported the mooted $16.5 billion project in Queensland but said the public was being short-changed."We need Adani or other project of similar size," he said."For Adani, we would have owned the railway line and its rollingstock and he [Gautam Adani] would have paid for it," he said, delivering the annual Sir Thomas McIlwraith Lecture, organised by conservative think-tank, the Australian Institute for Progress."You see now, Adani owns the line and he asks us to front up with $1 billion [from the $5 billion Northern Australian Infrastructure Facility."Sir Leo, 91, served 15 Queensland treasurers and 10 premiers from both sides of politics, working as deputy under treasurer, under treasurer and Queensland Treasury Corporation chair in a career that began in 1942.He negotiated key contracts with mining companies to secure royalties for taxpayers, facilitated the development of Queensland's casino industry and two coal terminals and established the Queensland Treasury Corporation.Labor Queensland Premier Annastacia Palaszczuk has vetoed the almost $1 billion concessional loan for the Adani coal mine, while federal Opposition Leader Bill Shorten has hardened his stance against the mine.Sir Leo expressed support for a new coal-fired power station in Queensland, an outcome federal Nationals MPs have been agitating for."What we need right now is a clean coal-fired power station to maximise our natural strength," he said."We have plenty of coal and coal-fired power generation produces one of the cheapest electricity."Sir Leo, after whom the two Gateway Bridges were renamed in 2010 under the Bligh Labor government, also took aim at the Queensland debt level, which will reach $83.09 billion by 2021-22."This compares with the $20 billion debt throughout the '80s and '90s," he said.Sir Leo said the current level of debt was a "worry" and there seemed to be no plan to pay it off."Sorry kids, sorry grandkids," he said."The interest cost even at today's relatively low interest rate would be fairly close to $2500 million per annum."We should be trying desperately to cap and reduce the size of this millstone."His speech was followed by fond and supportive speeches by former Labor treasurers Keith deLacy and Andrew Fraser and Liberal treasurer Joan Sheldon.
QuoteJAPAN'S Mitsubishi Corporation has officially expressed concern to the State Government over the Aurizon dispute and its impact on supply.It came as Queensland Resources Council chief executive Ian Macfarlane said he had not seen the Japanese as concerned about an issue in 20 years of dealing with the nation."There is too much at stake for Aurizon's reckless tactics to be left unchallenged any longer,'' Mr Macfarlane said.Mitsubishi is the joint owner of seven Queensland coal mines with BHP and its concerns add to those of Nippon Steel and the Japanese Government, which raised the issue through its Brisbane consul general earlier this year.Mitsubishi's concerns are noted in Premier Annastacia Palaszczuk's report on her Japanese trade mission earlier this year.The report said a senior executive of the company Daiju Mita expressed concerns about Aurizon's recent development with the Queensland Competition Authority, "noting the importance of supply security''.Earlier this year, Aurizon dramatically changed its maintenance practices on the central Queensland coal network after a draft ruling from the QCA on how much it could earn from the rail line.The draft ruling was about $1 billion below Aurizon's submission and to deal with the loss of earnings, it implemented maintenance changes that have the effect of reducing coal exports by about 20 million tonnes.It has consistently said it had no choice because the final decision from the QCA was likely to be the same as the draft decision and backdated to July last year.Premier Palaszczuk's report said she assured Mr Mita that she would continue to ensure that Aurizon worked closely with resource companies to achieve a resolution, but the QRC said after eight weeks Aurizon has refused to budge."The Government should stand up for the regulator and ensure the process is followed," Mr Macfarlane said."The industry appreciates the Premier taking the time to reassure Japanese steelmakers and Government officials in Tokyo two months ago."We appreciate the Premier has publicly urged Aurizon to resolve the issue with QCA. But almost eight weeks later, Aurizon isn't budging."It's time for common sense to prevail. Aurizon has tested the patience of our coal customers for long enough."The coal industry supports the independence of the Queensland Competition Authority and Aurizon must do the same."These were the rules when Queensland Rail was privatised. Aurizon should restore normal maintenance arrangements on the network and stop undermining the QCA."Aurizon said it had provided a briefing to Japan's steel and power industry representatives and assured them that all changes being made to operating practices were compliant with contractual and regulatory obligations to our customers."Aurizon remains committed to working with our customers and the QCA to try and reach a fair and equitable outcome," the company said.
QuoteTHE coal industry has attacked rail operator Aurizon again claiming the impacts of its maintenance practices on the vital central Queensland coal network have worsened with miners unable to meet export contracts.In a submission to the Queensland Competition Authority, the Queensland Resources Council said Aurizon Network has continued its campaign to disrupt access in order "to extract a more favourable result in relation to revenue''."Aurizon Network's improper conduct justifies significant changes to the undertaking to ensure that Aurizon Network cannot misuse its monopoly power again,'' the QRC said.The issue stems from a QCA draft ruling on the amount of revenue Aurizon could earn on the monopoly network. The amount was $1 billion less over four years than Aurizon had submitted.Since that draft ruling Aurizon has imposed stricter maintenance practices on the network to reduce costs. The effect could be the loss of about 20 million tonnes of coal exports. The QRC submission has said there have been coal producers who have been unable to rail the volumes necessary to meet contracts in May and June."This has also resulted in considerable stockpiling at both mines and ports across the CQCN (Central Queensland Coal Network),'' the submission said. "(There has been) continued reduction in the number of available or useable train paths: there has been a consistent decline in the number of available or useable train paths, which has continued to impact a number of coal producers' coal sales."The impacts of Aurizon Network's behaviour are not sustainable and require robust changes to the drafting of (the undertaking) to discourage such damaging conduct from being repeated in the future.""The Aurizon Network board owe a duty to act in a way consistent with the best interests of the company."That duty has not to date tempered the actions of Aurizon Network. Accordingly, generally speaking, the QRC do not consider that the Aurizon Network board operate in a way as to encourage compliance.''Rival rail operator Pacific National has also said that greater accountability should be applied to Aurizon in relation to maintenance.
QuoteAurizon has cancelled one of its two intermodal business sales with competitor Pacific National, after the competition watchdog rejected both moves in July.PN and Aurizon announced a pair of deals worth $225 million in 2017.A partnership of Pacific National and Linfox were to buy Aurizon's Queensland Intermodal business, while Pacific National was set to buy Aurizon's Acacia Ridge terminal.The Australian Competition and Consumer Commission rejected both deals on competition grounds in July.Aurizon will persevere with the Acacia Ridge deal, but said on August 13 it had cancelled the sale of Queensland Intermodal due to the ACCC's objection, and plans to close the business.The Supreme Court will this week rule on the ACCC's bid for an interlocutory injunction to stop Aurizon from closing Queensland Intermodal.Should the Supreme Court rule in the ACCC's favour, Aurizon will have to seek another sale partner for its Queensland Intermodal business.Aurizon has refunded a $10 million payment to Pacific National as a result of the cancellation, but said a $35 million payment made ahead of the Acacia Ridge sale remains non-refundable."On 12 August 2018 Aurizon provided PN with a notice to terminate the Business Sale Agreement for the Queensland Intermodal business, with effect from 13 August 2018," Aurizon said in its Annual Report for FY18."It is Aurizon's intention to not contest clearance of the transaction through the Federal Court and to exit the business."The Business Sale Agreement for the Acacia Ridge Terminal remains in place while Aurizon seeks clearance of that transaction, and the remainder of the consideration received for the transactions to date ($35m) is not refundable."The ACCC in July not only rejected both sales on competition grounds, but launched Federal Court action against Aurizon and Pacific National "for allegedly reaching an understanding... that had the purpose and/or would be likely to have the effect of substantially lessening competition in the supply of intermodal and steel rail linehaul services throughout Australia".The crux of the competition watchdog's claim is that early in the sale process, Aurizon allegedly agreed to make Pacific National the only candidate to buy the businesses, in a mutual effort to eliminate potential new competition in the Australian rail market."At all times, Aurizon had alternatives to selling to Pacific National that would have been more competitive," ACCC chairman Rod Sims said. "The ACCC is aware of at least one alternative purchaser that is willing and able to acquire Aurizon's entire remaining intermodal business."However, the evidence makes it clear that it was more lucrative for Aurizon to agree to sell parts of its intermodal business to its closest competitor, and close other parts of that business, than it was to sell the whole intermodal business to a potential new entrant."Sims said the proposed sales would make Pacific National the monopoly operator of intermodal rail linehaul on the North Coast Line servicing northern Queensland, and would cut the number of players in Australia's interstate intermodal market from three to two (with SCT Logistics being the other player).The ACCC is seeking declarations, pecuniary penalties, costs, and orders from the Federal Court restraining Pacific National from acquiring Acacia Ridge and Aurizon's Queensland intermodal business.When the sale was announced last August, Pacific National boss Dean Dalla Valle said the Acacia Ridge site "supports Pacific National's goal of providing consistent and reliable freight rail services to our customers".
QuoteTHE Queensland Competition Authority has admitted its bid to make a decision on the Aurizon issue has been thwarted by the company's controversial legal action.A decision was expected to be made on September 20, but that appears to have been delayed until court action in October.The QCA has already issued a draft decision on how much Aurizon can make on its central Queensland coal network which was $1 billion less than the company submitted and that act led to the company taking dramatic action to restructure its maintenance on the line.The impact of that action would be a loss of exports of about 20 million tonnes, worth an estimated $4 billion.Aurizon also started legal action claiming apprehended bias by the then QCA chairman Prof Roy Green who, days after the draft decision, announced he would be taking a position at Newcastle Port, a competitor of Aurizon.The QCA said it had decided to delay its final decision on Aurizon Network's 2017 draft access undertaking, pending resolution of the judicial review proceedings on its December 2017 draft decision."It is disappointing that Aurizon Network has asked the QCA to delay finalising its decision in September 2018,'' it said."However, the QCA acknowledges that Aurizon Network continues to pursue its judicial review application.''QCA notified Aurizon Network that it expected to be in a position to issue its final decision on September 20, but Aurizon opposed that while the case was continuing."The QCA considers that there are clear benefits in its final decision being made as soon as practicable."However, given Aurizon Network continues to pursue its judicial review application on the draft decision, the QCA has decided to delay making its final decision on Aurizon Network's 2017 DAU until after the Court has made its judgment."While regrettable, the QCA considers this approach is nevertheless required at this time. The QCA is confident that it will be in a position to progress a final decision after the Court has made its judgment.''
QuoteRECENTLY, Workers at Aurizon's Longreach facility were visited by an Aurizon executive. He told them that on January 1, 2019 all their jobs will be gone.In shock, the workers asked if the pending decision in the ACCC federal court case — due to be heard in November — might change this situation, they were told no. They were told the service will absolutely cease on January 1, 2019.Closing this rail freight service will cripple western Queensland. This service is not just about livestock transport, it is also about the supply of essential goods-inwards to stock local businesses from food stores to hardware and more.It also allows the safe and efficient transport of goods-inwards classified as hazardous and dangerous which are essential to daily life.This is not a surprise decision.I have been trying for years to get the Government to address it.I can get no meaningful response from the Minister. I have asked if he has a plan to ensure a western rail freight service continues when Aurizon withdraws.I have written to him suggesting a solution with Longreach becoming a central freight handling hub, receiving the inward rail freight and dispatching it to outlying communities by road. The Minister has not responded.I asked the Deputy Premier, in August of 2016, whether she could assure Western Queenslanders they wouldn't be adversely affected by Aurizon's decision to sell their intermodal business. She fobbed off the question.In May 2018, I asked the Transport Minister to ensure subsidised regional freight services would continue, regardless of Aurizon's decision — he fobbed the question off.And again in June and August, the Minister refused to give assurances, beyond "We have a plan ..." that Western Queenslanders will have a freight service after January 1, 2019.The Minister cannot just sweep this under the carpet.There is a widespread and growing realisation in regional Queensland of the total dysfunction across our vital rail networks statewide.Queensland needs a Government that can deliver a functioning regional rail network. A regional rail network that provides efficient logistics and optimal value for Queensland producers competing in international markets.A regional rail network that supports the Queensland regional towns that rely on it for essential goods.
QuoteREGULATORS have found no impact on Queensland's coal production and throughout from the long-running Aurizon dispute.But the Queensland Competition Authority has admitted it was unable to ascertain whether the actual volumes would have been higher, but for the announced change in maintenance practices by Aurizon Network."For example, Aurizon Network indicated in its annual reporting that an additional 7 to 8 million tonnes could have been railed in full year 2018,'' the QCA said.The report from the QCA backs the analysis from Queensland Treasury which said the impact was likely to be minimal and well below the prediction from Aurizon of a loss of 20 million tonnes."We also note Aurizon Network did not seek to reduce full year 2019 volume forecasts used to set the UT4 transitional tariffs recently – confirming 244 million tonnes represented the most recent and reasonable forecast of volumes expected to rail during full year 2019."This amounts to an expected increase of around 15Mtpa compared to record throughput achieved in FY18.''Japanese steel mills have raised their concerns with the State Government over the dispute because of fears of supply interruptions.The Queensland Resources Council said there had been significant reputational damage from the dispute."It is clear that there has been material damage to the industry and its hard-won reputation as a reliable supplier of quality metallurgical and thermal coal in key markets like Japan,'' QRC chief executive Ian Macfarlane said."The Premier sought to reassure Japanese steelmakers and the Japanese Government in May."For Queensland, which relies on coal for almost half of export earnings ($33.5 billion from total of $75.4 billion in the 12 months to end of July 2018), the cost of this saga will be counted over many years."An Aurizon spokesman said the company had consistently stated it had fulfilled its contractual and regulatory obligations and that the estimated loss of 7 to 8 million tonnes during 2018 was a foregone opportunity for the Queensland coal supply chain."With respect to the 2019 forecasts, actual tonnages will influenced by a number of factors including market demand and pricing (currently strong for Queensland coal), mine production for respective resource companies, and supply chain performance (rail and port). Aurizon remains committed to meeting all contractual and regulatory obligations.''
QuoteLogistics firm Linfox will buy Aurizon's Queensland Intermodal business, after the market watchdog blocked a sale to a Pacific National-Linfox partnership earlier this year.Aurizon on Friday announced it would sell its Queensland Intermodal business to Linfox for $7.3 million.Linfox will acquire freight forwarding and pick-up-and-delivery assets, rail wagons, customer contracts, and terminal access in the move.The sides also announced a separate 10-year take-or-pay deal between Linfox and Aurizon's Bulk business, which will provide rail linehaul services and some terminal services to Linfox using Aurizon locomotives and employees.Roughly 190 existing Aurizon employees will move to Linfox.Linfox executive chairman Peter Fox said the company was proud to be making a strategic investment in Australia."This significant acquisition will strengthen the Linfox network and increase competition in the Queensland logistics market," Fox said."It will also bring certainty to Aurizon staff, regional communities and customers that would have been impacted if the Aurizon [Queensland Intermodal] business had closed."Linfox Logistics chief executive Mark Mazurek said the company aimed to provide a "new and compelling" option for businesses moving freight in and out of North Queensland."We understand the strategic importance of this region and the entry of Linfox with our safe, secure and compliant logistics services will unlock significant value for our current and future customers," Mazurek said.Aurizon to press on with Acacia Ridge saleFriday's deal came more than a year after Aurizon said it would sell the business to a partnership of Linfox and Aurizon's primary competitor, Pacific National.The Australian Competition & Consumer Commission launched court action over the sale in July this year.The ACCC's case, which is before the Federal Court, alleges Aurizon and Pacific National conspired to stifle new entrants into the local intermodal rail market when they agreed to the sale.Aurizon says it will continue to push for the other half of that deal, which is the $205 million sale of its Acacia Ridge intermodal terminal to Pacific National."Aurizon and Pacific National will continue to seek clearance of the $205 million sale of the Acacia Ridge terminal through the Federal Court proceedings scheduled to be heard on 19 November 2018," Aurizon said on Friday.The sale of Queensland Intermodal to Linfox is subject to the Federal Court lifting an interlocutory injunction it placed on Aurizon when the ACCC brought its case.ACCC chairman Rod Sims in July alleged Aurizon had alternatives to selling to Pacific National "that would have been more competitive"."The ACCC is aware of at least one alternative purchaser that is willing and able to acquire Aurizon's entire remaining intermodal business," Sims said.Aurizon on Friday said Linfox was "the only standalone, binding bid" for the Queensland Intermodal business.
QuoteFREIGHT giant Aurizon will sell its Queensland intermodal business to Linfox for $7.3 million, a deal that will help secure about 300 jobs across the state.The sale will include Aurizon's freight forwarding and pick-up-and-delivery assets, rail wagons, the transfer of customer contracts and employment of the majority of Aurizon's intermodal employees, as well as access to terminals.Aurizon announced last August that it was offloading the loss-making freight business, including the Acacia Ridge intermodal terminal, after announcing a $188 million loss.Aurizon will continue to seek clearance of the $205 million sale of the Acacia Ridge terminal to Pacific National, with Federal Court proceedings scheduled to be heard next month.The sale to Linfox will see about 190 Aurizon employees involved in terminal operations and pick up and delivery services transferred to Linfox. Approximately, 120 Aurizon intermodal employees will transfer to the company's bulk operations.Aurizon said yesterday that the sale avoided a potential closure of the business with the potential loss of more than 300 jobs, many of which were located in regional Queensland.
QuoteThe Australian Competition & Consumer Commission (ACCC) will not block the sale of Aurizon's Queensland Intermodal business to logistics firm Linfox.Aurizon on Friday announced it would sell its Queensland Intermodal business to Linfox for $7.3 million.Aurizon's initial plans were to sell the business to a partnership of Pacific National and Linfox, but the ACCC blocked that sale in July.On Friday, ACCC chair Rod Sims said the sale of the business to Linfox alone would not be challenged by the competition watchdog, as it did not believe it will reduce competition."Linfox's operations in Queensland are relatively limited, and the transaction will mean there will remain two intermodal rail line-haul providers in Queensland, which is a good outcome for rail competition and Queenslanders," Sims said.Linfox will acquire freight forwarding and pick-up-and-delivery assets, rail wagons, customer contracts, and terminal access in the move.Aurizon and Linfox also announced a separate 10-year take-or-pay deal between Linfox and Aurizon's Bulk business, which will provide rail linehaul services and some terminal services to Linfox using Aurizon locomotives and employees.Roughly 190 existing Aurizon employees will move to Linfox.Linfox executive chairman Peter Fox said the company was proud to be making a strategic investment in Australia."This significant acquisition will strengthen the Linfox network and increase competition in the Queensland logistics market," Fox said."It will also bring certainty to Aurizon staff, regional communities and customers that would have been impacted if the Aurizon [Queensland Intermodal] business had closed."Linfox Logistics chief executive Mark Mazurek said the company aimed to provide a "new and compelling" option for businesses moving freight in and out of North Queensland."We understand the strategic importance of this region and the entry of Linfox with our safe, secure and compliant logistics services will unlock significant value for our current and future customers," Mazurek said.Aurizon had previously announced that it would shut the Queensland intermodal business if it couldn't progress the earlier transaction proposal involving Pacific National.Aurizon to press on with Acacia Ridge saleFriday's deal came more than a year after Aurizon said it would sell the business to a partnership of Linfox and Aurizon's primary competitor, Pacific National.The ACCC launched court action over the sale in July this year.The ACCC's case, which is before the Federal Court, alleges Aurizon and Pacific National conspired to stifle new entrants into the local intermodal rail market when they agreed to the sale.Aurizon says it will continue to push for the other half of that deal, which is the $205 million sale of its Acacia Ridge intermodal terminal to Pacific National."Aurizon and Pacific National will continue to seek clearance of the $205 million sale of the Acacia Ridge terminal through the Federal Court proceedings scheduled to be heard on 19 November 2018," Aurizon said on Friday.The sale of Queensland Intermodal to Linfox is subject to the Federal Court lifting an interlocutory injunction it placed on Aurizon when the ACCC brought its case.The ACCC compelled the court to grant the injunction after Aurizon said it would close the business if its initial sale plan was blocked."The ACCC did not consider that Aurizon's shut-down plans were rational given there were other options," Sims said on Friday."The sale of the Queensland intermodal business demonstrates why the ACCC must always question claims that businesses will be shut if we don't approve a merger."ACCC chairman Rod Sims in July alleged Aurizon had alternatives to selling to Pacific National "that would have been more competitive"."The ACCC is aware of at least one alternative purchaser that is willing and able to acquire Aurizon's entire remaining intermodal business," Sims said.Aurizon on Friday said Linfox was "the only standalone, binding bid" for the Queensland Intermodal business.
QuoteListed rail company Aurizon has failed in its attempt to claim former Queensland Competition Authority chairman Roy Green was conflicted when the regulator slashed $1 billion in revenue off Aurizon's regulated assets in a draft determination last December.In a major blow for the rail hauler which is involved in a long-running dispute with the QCA and the big miners over how much it can charge to use its lucrative coal networks in Central Queensland, the Supreme Court rejected its claims of apprehended bias against Professor Green.Justice David Jackson on Tuesday dismissed Aurizon's case saying he found no evidence the average observer would believe there had been bias by Professor Green in the QCA's draft determination.He ordered Aurizon to pay costs and reserved his decision on costs for the other respondents, including mining companies Anglo American, BMA Alliance, Coronado, Jellinbah Resources, Lake Vermont Resources, Peabody Energy and Yarrabee Coal.The decision means the QCA is expected to hand down its final determination before the end of the year. Aurizon is also expected to appeal this decision.Aurizon claimed Professor Green was conflicted because he had been in negotiations with his future employer, the Port of Newcastle, before the QCA determination stripped $1 billion in revenue from the rail company's approved revenue for the next five years.In a statement on Tuesday, Professor Green said the Aurizon court action calls into question the "judgment and commercial acumen" of Aurizon chief executive Andrew Harding."Instead of addressing the substance of the regulator's draft decision, they chose to pursue a time-wasting judicial review application whose grounds changed on an almost daily basis," he said."In doing so, they have alienated their customers, let down their shareholders and caused untold damage to their reputation. More fundamentally, they have amplified the problems of a vertically integrated monopoly whose privatisation enabled an above rail competitor to won the below rail network."Aurizon's lawyers had argued Professor Green had held two meetings with the Port of Newcastle, which included discussions on the impact of Adani's $16.5 billion Carmichael mine on the Hunter Valley coal network. (The Central Queensland coal network would deliver coal from Adani's mine to ports for export).They said Professor Green played a "material part" in the QCA draft decision which forced Aurizon to change its maintenance practices and which the rail company says will result in 20 million tonnes less coal being exported each year. The decision has angered big mining companies and Japanese steel producers.But Professor Green said the discussions over the Adani mine threat were "hypothetical" and only raised as a passing matter. Lawyers for the QCA said Professor Green had left the regulator on June 30 and would play no role in the final determination which is expected before the end of the year.Justice Jackson said Aurizon's claims of apprehended bias were "too tenuous or theoretical".An Aurizon spokesman said the company was still fighting for a "fairer" decision on what it could charge its customers on Queensland's coal network."We note the decision. We will continue to work with the QCA and stakeholders in seeking a fairer outcome with respect to the UT5 access undertaking, including regulatory and commercial pathways," the spokesman said.
QuoteAURIZON shares have risen as the regulator offered it a better deal on how much it can make from its monopoly coal network in Queensland.The Queensland Competition Authority has released its long awaited final decision — a massive 460 page document — that allows Aurizon to earn $4.12bn over four years.That is about $230m more than previously granted but still $769 million short of what the rail operator had asked for originally.It follows a two year battle between Aurizon and the QCA including Supreme Court action which Aurizon lost in October.Aurizon has 60 days to respond and on Friday declined to say if it would comply."We will review the Final Decision in detail and make a determination regarding any potential impact on operating practices," a spokesman said.Shares closed up 1.38 per cent at $4.42 and industry analysts commented that it was a more positive decision than expected, however they also said a judicial review by Aurizon was now likely.
QuoteRAIL giant Aurizon has reported a 19 per cent slump in interim profit amid a battle with the competition watchdog over how much it can earn from its coal network in Queensland.Brisbane-based Aurizon on Monday said net profit was $227 million in the six months to December 31, while revenue slipped 7 per centto $1.46 billion.Aurizon has been locked in a bitter fight with the Queensland Competition Authority over maximum returns on its central Queensland rail network that hauls coal to ports in the region. Aurizon claimed a decision by the QCA could punch a billion-dollar holein its bottom line.Aurizon managing director Andrew Harding said the company had made the decision to book revenue based on QCA's final decision. Mr Harding said coal shipments also had been affected by weather and industrial action. "We forecast last year that we wouldsee headwinds this financial year and we are starting to see this today," Mr Harding said.He said Aurizon would not launch further legal challenge to the QCA's decision but would make its final submission to the authority by February 18. Aurizon last year lost a legal battle to block the QCA decision, warning the revenue short fall would necessitate a cut in maintenance on the network.He said the north Queensland floods had affected business but no staff had been injured. There had been no serious damage to assets. Mr Harding said overseas demand for Australian coal was driving Aurizon's national growth plan. In the past two years, the company had invested $110 million in its New South Wales network to support shipments of the fuel. A further $60 million would be invested in Queensland.Burrells Stockbroking senior research analyst Bruce McLeary said the result was in line with investor expectations."The key take out is that there is a little more certainty now in relation to the regulators' decision," said Mr McLeary. He said the company would want to expedite any future industrial disputes with staff over new enterprise agreements.Aurizon shares rose 1 cents to $4.44 on Monday.It will pay an interim dividend of 11.4 cents a share, down from 14 cents in the previous first half.
QuoteRAIL giant Aurizon has struck a decade-long deal with some of Queensland's biggest coal miners over the cost of accessing its central Queensland rail network.The deal is seen as a major breakthrough for Aurizon, which has been fighting an extended battle with the Queensland Competition Authority (QCA) and the mining industry over how much money it can charge mining companies to use its rail tracks.Aurizon said yesterday the terms of the proposed access agreement had been extended until 2027 with an increased return to the company on its investment in the network.Aurizon started cutting schedules last year in response to a draft decision by the QCA that slashed by $1 billion the amount the company could earn from the network.Reduced schedules, which cut after-hours maintenance, meant fewer coal trains could be delivered to major ports. Miners had warned thar Japanese steels mills were considering buying coal in other markets because of the Aurizon impasse, which could have cut about $4 billion worth of coal exports. Mining giant Glencore had accused Aurizon of destabilising the Queensland coal industry for its own profit.Aurizon chief executive Andrew Harding said yesterday the agreement was an important step to better address customer needs and provide longer term certainty for the resources sector. Aurizon earlier this year reported a 19 per cent slide in first-half profit as the dispute dragged on. Aurizon said miners including Anglo American, BHP, Coronado, Glencore, QCoal and Yancoal would be submitting letters of support for the new agreement to the regulator.The agreement will require sign off by the state's competition regulator before coming into effect. BHP executive Rag Udd, who is chair of the Queensland Coal Rail Working Group, said the new access regime provided greater certainty to sustain export operations."It places a greater commitment on Aurizon to deliver the capacity ... and work with industry to develop productivity and efficiency improvements," Mr Udd said. Aurizon shares climbed 2.95 per cent to $4.89 yesterday.
QuoteThe competition regulator will appeal a controversial federal court decision governing access to Queensland's rail network, saying it placed too much faith in undertakings by the companies involved.In May, the federal court waved through Aurizon's sale of its Acacia Ridge Terminal in Brisbane to National Pacific for $205 million, overruling opposition from the Australian Competition and Consumer Commission (ACCC).A key plank of that decision was an undertaking from Pacific National governing how competitors could get access to the terminal that the company offered on the final day of the proceedings.ACCC chairman Rod Sims said the regulator would argue the court erred by accepting the undertaking and then using that to determine the question of the deal's competitive impact."This appeal is crucial to Australia's merger regime because acceptance of undertakings of this kind by the Court means that anti-competitive mergers could be approved, and this has the potential to damage the Australian economy," Mr Sims said."The ACCC, along with competition regulators around the world, has concerns about the ability of access undertakings to resolve competition issues arising from a merger."He said the ACCC was still worried that the deal could see Pacific National discriminate against competitors at Acacia Ridge."There are many subtle ways in which it could disadvantage a competitor in their day-to-day operations, regardless of any commitments it makes in an undertaking," Mr Sims said."Potential new entrants will be well aware of this risk, and, in our opinion, this may mean companies are less likely to enter what is already a highly concentrated market. This is the primary reason we rejected a similar undertaking offered by Pacific National during our merger review."A Pacific National spokesman said the judgment had been "pro-competitive" because it guaranteed access for new entrants to get freight from road to rail."It's important to remember the undertakings we've committed to did not previously exist at Acacia Ridge Terminal and any assertion that we would somehow subtly work to discriminate against other users is simply wrong," he said."This court action by the ACCC has been an expensive and reputationally damaging exercise."The spokesman said the company would defend its position in court.In a statement to the ASX, Aurizon told investors the appeal process would delay the finalisation of the deal.It said it did not accept the ACCC's view that the undertaking was insufficient."This matter was fully considered by the federal court and the decision handed down in May 2019 was clear and comprehensive," the statement said.Aurizon shares were down about 1 per cent by Thursday lunchtime at $5.38.
QuoteAurizon will invest $50m in low carbon locomotives such as battery and hydrogen-powered trains to meet a net zero goal by 2050.The freight hauler and network owner will also look to maximise the benefits of the electrified freight network in Queensland, particularly as more renewable energy is fed into the grid.Managing director and CEO of Aurizon, Andrew Harding said that the company was confident that technology would meet the company's goals."We are confident that rapidly-advancing technology in the rail sector will unlock major benefits like we are seeing in motor vehicles, energy generation and general industry. Our focus will be low-carbon technology for our locomotive fleet which accounts for more than 90 per cent of Aurizon's CO2 emissions."In addition to actions undertaken internally, Aurizon will also push for government action."We directly advocate for policy actions to increase the use of rail freight on key national freight corridors. Our aim is to ensure that rail freight remains competitive and part of the solution as the economy transitions to a low-carbon future," said Harding.The company's commitment follows the latest Sustainability Report from the freight operator. In the report, Aurizon advocates for lowered electricity costs to reduce the risk of substituting electric locomotives for diesel-powered trains. In addition, Aurizon outlines that the company has been advocating for greater infrastructure investment, improvements to regulation and finding efficiencies at interfaces between modes.To meet the goal of lower emissions, Aurizon said that it would be making significant investments in new rollingstock shortly."Aurizon is already working with other railroads and manufacturers on the early development of battery and hydrogen-powered locomotives for deployment in a heavy-haul railway environment. This includes options of upgrades to the existing fleet and new rollingstock. We would expect to see prototypes trialling on our network by 2025, as technology advances and costs come down further," said Harding."Locomotives are long-life assets of 20 – 30 years. We have some significant decisions ahead in renewing our locomotive fleet – potential game-changers for the freight industry – when we invest in the next generations of rollingstock to power our business through to 2050."
QuoteBUSINESSQueensland's coal could soon be hauled to ports by renewable energy or hydrogen-powered trains.Brisbane-based Aurizon has announced plans to spend $50 million to find low-carbon technologies for its trains including the development of battery and hydrogen-powered solutions.Prototypes could be running on the network within five years.The company, which hauls much of Queensland's coal production to the ports, said it would also target net-zero operational emissions by 2050 which would include a 10 per cent reduction in greenhouse emissions intensity by 2030. It has already achieved a 20 per cent reduction between 2010 and this year.It would also maximise the benefits of the electrified coal network and electric locomotives in Queensland as an increasing proportion of renewable energy sources feed into the national grid.Battery-powered trains already exist in parts of Europe and Bombardier, which manufactures trains for QR, has been making the new-age battery trains since 2018. Hydrogen-powered trains may be further down the track, however, French manufacturer Alstom already has one model in operation.Aurizon's emissions in the 2020 financial year were 868 kilotonnes of CO2 equivalent.Managing director Andrew Harding said his company accepted the science around climate change."We recognise we have a responsibility to take action on climate change so we can achieve an effective transition to a low-carbon future," he said."This strategy represents a year-long program of work by an Aurizon team which has collaborated with major global railroads, rail manufacturers, as well as technical experts on low-carbon technologies."We are confident that rapidly-advancing technology in the rail sector will unlock major benefits like we are seeing in motor-vehicles, energy generation and general industry."Harding said the transition to low-carbon technology could include upgrades to the existing fleet or new rolling stock," he said.Because the locomotives have a life of between 20 and 30 years, the transition to battery or hydrogen was a big decision, Harding said.
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