Aurizon, a train wreck?

The biggest mining, energy and transport companies ( in Australia don’t pay any tax yet they cause the most environmental damage. Here is a current list of the main offenders:

ExxonMobil Australia Pty Ltd
Energy Australia Holdings Limited
Virgin Australia Holdings Limited
Santos Limited
Peabody Australia Holdco Pty Ltd
Ford Motor Company of Australia Ltd
Chevron Australia Holdings Pty Ltd

Aurizon, Australia’s largest freight company, pays very little tax.

Sulphuric Acid Train derails near Julia Creek (Photo: ABC)[/caption]

Hectoria (Paradigm Shift, 4ZZZ fm 102.1, Fridays at noon): At 10:20am on Sunday 27 December, an Aurizon locomotive and all 26 carriages derailed about 20 kilometres east of the outback town of Julia Creek. The minister declared an emergency under the Public Safety Preservation Act and placed a two-kilometre exclusion zone around the crash site. The train was carrying 200,000 litres of sulphuric acid. The derailment badly damaged the railway line near the outback train stations of Quarrells and Julia Creek. There has been a lot of rain there recently. Both sulphuric acid and diesel fuel spilled into the water table after the diesel locomotive ploughed into a bore hole. Three drivers of the train were injured and taken to Julia Creek hospital. I was on the line to Steven Miles, Minister for Environment and Heritage Protection and Minister for National Parks and the Great Barrier Reef, within hours of the disaster.

Hectoria (PShift): It has been an annus horribilis for Aurizon this year with the slump in commodity prices and 25% drop in share prices. How many jobs has Aurizon shed in the past three months?

Minister (Steven Miles): Well last week there were 40 jobs lost in Rocky and 34 in Townsville so it looks like 74 jobs all up this year in Queensland. But overall 800 jobs will be lost as the resources slump curbs demand for Aurizon‘s coal haulage services.

H: Was it right to sell Queensland Rail to Aurizon, Australia’s largest rail freight operator?

Minister: I have looked at all the datasets and calculate that there would have been jobs loses even if we had kept Queensland Rail in public hands.

H: But if you hadn’t sold Queensland Rail workers would have had some say and the state would have the benefit of the haulage charges and royalty payments paid by the big mining companies?

Minister: Well, we are subject to federal government competition laws, so freight charges and royalties from mining companies are capped at 8%.

H: But before competition policy was introduced, royalties were 25%! Why would publicly owned freight railway have to adhere to competition policies? We could have made the big multinationals pay for the resources they are ripping out of Queensland?

Minister: Well if we did charge big royalties we would lose all kinds of commonwealth subsidies.

H: Who owns the railway line at Julia Creek?

Minister: As it happens we own the track,  Aurizon owns the train, but it is under our control. We sold Aurizon the carting business from Mt Isa.

H: So they will foot the bill to fix the tracks?

Minister: Well, that depends.

H: On what?

Minister: Its complicated. We have to ask why the train derailed. We need to talk to the Aurizon drivers. Then we will have a better picture of what happened.

H: Queensland Rail say that the rail line to Mt Isa was always a basket case. Poor maintenance, always causing problems.

Minister: That is black soil country, it makes maintenance difficult after the wet because black soil is always shifting under the ballast. It washes away easily.

H: You mean that the track and the sleepers under it are under shifting sands.

Minister: Yes, it makes maintenance more costly and that is our responsibility.

H: Did you vote to sell Queensland Rail’s profitable coal cartage business?

Minister: I wasn’t even a member of parliament back then, I have only just been elected as Labor member for Mt Cootha … sorry, I have an urgent call from the police superintendent at Julia Creek on the other line.

H: Just before you go, who owns the sulphuric acid spilt from the Aurizon train wreck?

Minister: Well that is the subject of a legal dispute. The fertiliser company, Incitec Pivot … unless I am mistaken (another voice can be heard in background). A slight correction … Glencore Plc* has an agreement with Incitec Pivot Ltd to provide sulphur dioxide from the copper smelter to the Mount Isa acid plant. Queensland Rail, sorry Aurizon, then transports the sulphuric acid to Phosphate Hill where it is used in the production of phosphate fertiliser by Incitec.

H: How will you neutralise the acid in the ground water?

Minister: Limestone.

H: Where will you get the limestone?

Minister: Not sure, but Queensland Cement Limited (QCL) can provide the limestone.

H: Isn’t limestone extracted from coral? Where will QCL get the limestone? From the Great Barrier Reef?

Minister: Heaven forbid, no … (exasperated) we do have some rules you know … QCL mines the limestone from the coral reef off Mud Island in Moreton Bay.

H: But there is an environmental …

Minister: Sorry I have to go, any further questions please refer them to my DG.

H: Minister, just before you hang up, now that Aurizon’s shares have gone off the rails, there is a slump in commodity exports, Aurizon’s soon-to-balloon debt level and feeble cash flow have virtually derailed the company in Queensland isn’t it a good time to buy back Queensland Rail?

Minister: Give me a break (hangs up).

Hectoria: So there we have it listeners, one of Queensland finest minds, Steven Miles, a PhD from the University of Queensland in Political Science. By the way, Glencore bought out Xstrata’s mining business at Mt Isa in 2013. Mt Isa Mines was once a profitable Queensland based company that was, for a time, bought out by the Big Australian BHP which now has its own environmental problems with dam walls burst in Brazil [Interview Ends].

In 2010, after 147 years of public ownership, the ALP Government lead by Anna Bligh sold the profit making section of Queensland Rail to QR National (now Aurizon). Government advisors swore on a stack of bibles that the private sector can run big rail transport more effectively and more efficiently than the public sector. According to the Federal Court, during the privatisation process Queensland Rail management breached workplace agreements giving workers no say in the process.

‘How workers add value’ – from a Glencore diagram

Julia Creek Hotel publican David Wyld said the locomotive went into the bore drain after it rolled and ended up underwater.

“So that would’ve pulled off all the whole 26 carriages with sulphuric acid,” he said.

Mr Wyld said the road was blocked by rail workers immediately after the accident.

“The police and all that couldn’t get to it, blocked the whole road off straight away,” he said.

“And you could smell the sulphuric acid where they actually blocked it off.”

The state owned passenger rail services have been cancelled. The Inlander has been cancelled today and tomorrow from Townsville to Mount Isa.

Since privatisation of Queensland Rail, Aurizon has been carting sulphuric acid by rail from Mt Isa mine to the Incitec owned Phosphate Hill in ‘tank’ cars owned by GATX, a Chicago based rail car leasing business. It is likely the sulphuric acid in the train wreck was recovered from Mt Isa Mines production of copper/lead/zinc from the smelting flue gases which contain sulphur dioxide. Mt Isa Mines had a sulphur dioxide emission problem until they started manufacturing sulphuric acid which enabled them to drive extraction processes harder.

I will leave the reader to guess who will pay the cost of the clean-up?

It is not in the interest of workers and their organisations to be tainted by corruption within the ALP specifically and within government generally. The ALP is a liability to any functioning union, the union members should vote to disaffiliate from the ALP and insist Aurizon be returned to public ownership before more jobs are lost and more environmental damage is done.

The market response? All the mum’s and dad’s that invested in Aurizon have backed the wrong horse. Shares have plummeted on the back of lower tonnage of coal being carted to the sea.

The future of capitalism is as black as coal’s.

Ian Curr
1 Jan 2016

Economics and Environmental Costs of Mining

The not so good Economics of LNG (from Coal Seam Gas) in Queensland

Who will pay to rectify the costs of the mining disasters below – socialised costs again???

Another Cost of Mining – the sulphuric acid was recovered from Mt Isa Mines production of copper/lead/zinc from the smelting flue gases with contain sulphur dioxide.

Massive methane leak in California×350.glvooo.png/1451279309529.jpg

anna bligh sold us out
Anna Bligh sold us out

3 thoughts on “Aurizon, a train wreck?

  1. Interview with Minister, Steven Miles ... says:

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