ACCC accepts undertaking for Hunter Valley rail access and investment

The Australian Competition and Consumer Commission today accepted arrangements to promote efficiency and investment in the Hunter Valley rail network and export coal chain.

The arrangements are set out in a rail access undertaking accepted from Australian Rail Track Corporation (ARTC), the operator of the Hunter Valley rail network.

"The ACCC decision to accept this undertaking is another key step in the implementation of the long-term solution to capacity constraints in the Hunter Valley coal export supply chain," ACCC chairman Graeme Samuel said.

"In addition to the capacity management arrangements for the port of Newcastle, authorised by the ACCC in December 2009, these rail access arrangements should allow all parties to work together to remove export bottlenecks for the coal industry."

After an extensive consultation and development process involving the coal industry, non-coal users of the network, rail operators, port operators, the Hunter Valley Coal Chain Coordinator and ARTC, the arrangements approved today by the ACCC include:

• the negotiation of long term access contracts between users of the rail network and ARTC
• processes for new investment in the rail network, in consultation with stakeholders, and
• incentives to promote alignment of all coal chain contracts and efficient use of the Hunter Valley infrastructure.

"The ACCC is satisfied that these access arrangements appropriately balance the interests of all parties, and provide the certainty to underpin investment in infrastructure needed to meet surging demand for Australian coal exports," Mr Samuel said.

The Hunter Valley rail network transports coal from the region's mines to the Port of Newcastle for export. Around 100 million tonnes of coal is exported every year, worth about $9 billion per year in export earnings to Australia. It is one of the largest and most complex coal export operations in the world.

The rail network is also used by passenger trains, grain trains, north-south freight trains crossing the network, and coal trains supplying domestic users such as power stations.

Further information about this matter is set out in the ACCC decision to accept the undertaking, available on the ACCC website.