NO MINE: KCCG members Damien O'Sullivan, Gary Tessman, John Dalton and Marilyn Stephens don't want to see a coal mine built in Kingaroy.
NO MINE: KCCG members Damien O'Sullivan, Gary Tessman, John Dalton and Marilyn Stephens don't want to see a coal mine built in Kingaroy. KCCG

REPORT: Kingaroy coal mine project 'not economically viable'

RESEARCHERS have advised the proposed coal project near Kingaroy should be rejected by policy makers on economic grounds.

New research by the Australian Institute on March 13 reported the project was unlikely to be economically viable, facing huge barriers in getting coal to market and would adversely impact key local industries.

Kingaroy Concerned Citizens Group spokesperson John Dalton said the independent report confirmed what the group had been saying.

"We are not surprised that an outside source such as The Australian Institute came up with a pretty similar conclusion to our group," he said.

"It appears to not be economically viable."

The Australian Institute research director Rod Campbell said the Kingaroy economy was focused on services and agriculture.

"A major coal project would work against existing industries and the local government's stated plans for the future," he said.

The report revealed more than 50 per cent of employment in Kingaroy was made from various service sectors, whereas mining was less than four per cent of the town's employment.

Agriculture accounts for 12 per cent of employment and contributes substantially to South Burnett manufacturing industries that are centred on food processing.

Mr Campbell, the co-author of the report, said while there was a coal-fired power station nearby, it owned its own coal mine and publicly stated it did not need coal from other mines for many more years.

"For this new project to get coal to other markets it would need to build a rail link, this could coast $1 billion and also displace recently-built tourism infrastructure." he said.

"As renewable energy gets cheaper and coal demand declines, new coal mine proposals are just not economic."

The report revealed even projects with the backing of large corporations like Adani and Glencore's Wandoan mine have stalled.

"A project proposed by a small company with a history of environmental and tax problems has very little chance of proceeding," Mr Campbell said.

"Policy makers should rule out the project due to the low likelihood of economic benefit, potential environmental and economic risks and the costs associated with ongoing uncertainty for the community."

Economic benefits to the South Burnett are limited as most of the customers and owner of the Meandu and Tarong are outside the region.

The report said mining company Moreton Resources, who proposed the Tarong Basin Coal Project, had little cash-flow.

"Earlier incarnations of the company and the project incurred fines for environmental breaches and Moreton is contesting tax issues with the Australian Tax Office," the report said.

The report found the project was unlikely to be economic.

"It is unlikely that the Kingaroy coal proposal is in the economic interests of the Kingaroy community, or indeed the wider Queensland public," it said.

The research report will be publicly available on the Kingaroy Concerned Citizen Group website, as well as the Australian Institute website.

"Have a good read of the full document," Mr Dalton said.