From an article in the Sydney Morning Herald, ". . .according to a new report by the Institute for Energy Economics and Financial Analysis, sinking coal prices and high development costs would make the [Galilee Basin, Queensland] project prohibitively expensive to supply India’s growing demand for electricity.
“The key point is that retail electricity prices in India are considerably lower than the level required for the profitable generation of imported coal-fired power, particularly when that coal is sourced from isolated deposits with none of the required infrastructure in the middle of Queensland. . .” "
In addition, infrastructure must be built, adding to the project cost: "[the project requires] massive infrastructure investment including rail lines and port facilities in environmentally sensitive areas close to the Great Barrier Reef near Townsville and Mackay."
see link
As seen earlier on SLB, see link, the world will soon run out of coal. Even if coal deposits are already identified, economics will dictate whether the coal is actually mined, transported, and burned in a power plant for electricity. The above indicates this coal may not be economic at this time. However, the Indian companies that own the coal lease claim to be pressing forward on the project.
From the Indian government perspective, economics may not matter. India is quickly exhausting its domestic coal reserves and has little choice but to import coal to keep the power plants running. A conference at UCLA discussed the India energy outlook, concluding that domestic coal reserves will be exhausted in less than 20 years (by 2030). India is desperate for electricity, with approximately one-third of the population having none.
Roger E. Sowell, Esq.
Marina del Rey, California
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