ACCC proposes to allow coal producers to coordinate transportation

19 June 2014

The Australian Competition and Consumer Commission has proposed to grant authorisation for Rio Tinto, Peabody and Pacific National to coordinate transportation of coal in the Goonyella Coal Chain.

Rio Tinto and Peabody operate coal mines in central Queensland. Coal from these mines is transported via the Goonyella Coal Chain rail system to the Dalrymple Bay Coal Terminal, where it is loaded for export. Pacific National is a rail operator that transports coal for Rio Tinto, Peabody and other coal producers in the Goonyella Coal Chain. The Goonyella Coal Chain has been operating below its potential throughput capacity, resulting in lost exports.

“These arrangements are likely to result in public benefits through more efficient transportation of coal for export,” said ACCC Deputy Chair Dr Michael Schaper.

“The ACCC considers there are unlikely to be significant detriments, because the arrangements work within existing contractual and regulatory frameworks, and are voluntary for all coal producers and rail operators using the Dalrymple Bay Coal Terminal.”

Coordination of coal transportation by the applicants has been underway since the ACCC granted interim authorisation to the arrangements in late March, while it considers the substantive application for authorisation. The applicants have already been able to achieve some savings through greater coordination. The ACCC has also decided to extend interim authorisation to allow other coal producers and rail operators railing to the Dalrymple Bay Coal Terminal to participate in the coordination.

Authorisation provides statutory protection from court action for conduct that might otherwise raise concerns under the competition provisions of the Competition and Consumer Act 2010. Broadly, the ACCC may grant an authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.

Release number: 
MR 154/14
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