Head of GVK confirms overseas interest in Alpha Coal project
THE head of GVK Resources has shot down any speculation on the future of its $10 billion Alpha Coal project, saying it would be years ahead of its peers before it begins exporting in 2016.
Before then, the Indian powerhouse must build not only the mine but 500km of railway from western Queensland to a new port terminal at Abbot Point.
Coal and infrastructure managing director Paul Mulder said GVK had already spent up to $100million on developing a test mine - a small-scale open-cut prototype so it could export samples to both Korea and China to test its coal quality.
Mr Mulder said there was still work to be done before a final investment decision was made towards the end of 2013.
During a speech on Tuesday, he said India and countries of Asia had confirmed an intention to buy every load of the 30 million tonnes of coal to be exported annually from the mine.
His strong words follow some negative comments made by at least one resource industry academic questioning the project's future.
Mr Mulder explained that as other mining companies closed or mothballed their less profitable sites, GVK worked on a low-cost, long-term scale that meant Alpha would still make a strong margin even in gloomier times.
The focus of GVK's financials, he said, were focused on the millions creating a new middle class in India and China.
"We are investing $10 billion - we don't do it on the sentiment of yesterday or tomorrow, it is the sentiment over the long term," he said.
"We have been positioning our project to weather all economic climates."
The Alpha project was given its Federal Approval earlier this month, with Prime Minister Julia Gillard then witnessing the signing of a construction deal to build GVK's new terminal at Central Queensland's Abbot Point coal port.
The final investment decision is due in September next year once GVK ticks a few more boxes including the securing of a mining lease.
Once confirmed, construction will last three years with the first shipment of Alpha coal will leave Abbot Point before the end of 2016.
The entire mine-rail-port project is expected to create 1800 jobs, but will need 4000 workers during construction.