Arrested development

Alan Moran on the obstacles to creating wealth and the need for a government that understands as much:

… the Shenhua Watermark mine is a case study of all that is wrong with the regulatory impasse that confronts a new proposal.  The mine is not an exceptionally large project – a one billion dollar cost producing 10 million tonnes of coal a year (out of 500 million nation-wide) and covers a footprint of only 35 square km in an area which, while good farming country, is remote and lightly populated.

The proposal takes land with a net present value of $40 million and creates value estimated at over $3 billion with at least $1.3 billion accruing to Australia.  The firm has commissioned fourteen different consultancy services covering water, social assessment, flood control, acoustics, ecology, groundwater, aboriginal impacts and rehabilitation.  While these have been boons to consultants they have not contributed a dollar in value-added and have demonstrated to any other miners that the costs of doing business in Australia are considerably in excess of the mining and extraction expenditures that were once the norm … (emphasis added)

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