A long bow to draw?
CQ councils optimistic Komatsu takeover will deliver Galilee opportunities.
Wednesday 03 August 2016
The Rockhampton Regional Council (RRC) believes this week's decision by Komatsu to buy mining equipment supplier Joy Global for nearly $5 billion will put them in the box seat for servicing Adani’s proposed mega-mine in the Galilee Basin.
Komatsu said the purchase of Joy Global would allow them to extend their existing above ground mining services to the underground sector as they prepare for increasing demand in the future.
“Demand for mining equipment has declined dramatically from the peak, reflecting an economic slowdown in emerging countries and low commodity prices,” Komatsu said.
“ Over the long term, however, the mining equipment business is projected to grow, driven by population growth and rapid urbanisation around the world.
“In terms of mining techniques, economic rationale will call for use of larger equipment in surface mining as well as further development of underground mining and Joy Global and Komatsu's product lines will integrate well.
"Expanding options for customers worldwide, as Komatsu can now offer the underground mining equipment and super large-sized loading equipment of which Joy Global is a leading provider.”
In response to the sale, Resource Industry Spokesperson for RRC Neil Fisher said the transaction adds strength to Joy’s already significant footprint in the Rockhampton region.
“Locally, Joy Global has played a very strong role and is largely respected in the region’s resources industry, being one of the largest employers on the Parkhurst plant,” he said.
“It is progress such as this that is moving our region towards becoming the major hub for the supply of labour and services to the Galilee Basin.”
However, in coming to that conclusion, the councillor has made a few assumptions.
Namely that the Carmichael mine will go ahead - as its proponent Adani has always said it will - and that a non-binding agreement between Adani and Komatsu announced a year ago for the supply of 55 trucks will come to fruition.
Enquiries by Shift Miner last year to both Komatsu and Adani failed to shed any light on the details of that agreement although, Adani Australia COO, Samir Vora, said : “an integral component of the success of the mine will be using the most innovative, efficient, reliable and cost-effective equipment, in partnering with Komatsu; we are confident that we have chosen the right solution.”
The deal resurfaced again in April this year when Komatsu unveiled details about a new super-sized 980E-4 haul truck it hopes will deliver the cost efficiencies Adani need to make its proposed Carmichael mega-mine viable. According to Komatsu, it will “dwarf” everything currently operating in the Bowen Basin.
However, despite the hopes of Mackay and Rockhampton councils, it could be Townsville that benefits most out of the proposed Carmichael mine.
A year ago Adani confirmed it’s preferred source of fuel is Townsville based on the safety of road access.“At the present time, Townsville is considered the preferred location based on safety outcomes including the use of triple trucks, and the reduced impact on the Peak Downs Highway,” they said.