The Coal Trader

Western Australia to pump millions into Griffin Coal

West Australian taxpayers will spend hundreds of millions of dollars subsidising an insolvent Indian-owned coal miner as the state continues to grapple with its transition away from the fuel. WA premier Roger Cook on Friday said the state would provide $220 million to keep the Griffin coal mine near Collie running until June 2026.

The funding is on top of the almost $40 million provided to Griffin by the state to date, plus the millions more spent by the government on related consultant and legal fees. The Griffin mine is the major supplier of coal to the privately owned Bluewaters power station, as well as some industrial users.

Western Australia is far less reliant on coal than most other states, due to its comparatively modest coal reserves and its abundance of natural gas. The state government has already announced plans to close the two remaining state-owned coal-fired power plants by the end of the decade. Mr Cook warned that a sudden closure of Griffin – whose parent company is in receivership over debts of almost $1.5bn to Indian banks – would cause hundreds of job losses and increase the risk of instability in the electricity grid.

“I want to keep the lights on and the air conditioners running. That is not an option, that we have a situation where we have an energy deficiency,” Mr Cook said.

“And I want to make sure we look after the workers and ensure that they have a secure package and opportunities for further employment.”

Opposition energy spokesman Steve Thomas described the situation as a “debacle”. He said the state’s other remaining coalminer, Premier Coal, could have brought additional supply to market if the state government had acted sooner. He said the government’s decision to exit coal-fired power by the end of the decade had also discouraged private sector investment in the state’s coal mines.

“They’ve made it almost impossible for those coal companies to invest. The machinery at Griffin has been in tatters for years, but if you’re going to get closed down in the not too distant future then it’s hard to get investors to put money into it,” he said.

Unions said the government’s decision would have “dire consequences” for jobs, energy security and the coalmining community of Collie. Australian Manufacturing Workers Union of WA secretary Steve McCartney described the government’s decision as shortsighted and extremely disappointing.

“After multiple reviews by expensive consultants, the best plan the Government can come up with is to tip more taxpayer money down the black hole at Griffin Coal,” he said.