A Spotlight on Australia’s Mining Sector

Foreign entities have a substantial stake in Australia’s mining sector, controlling 86% of the industry. This includes some companies that many Australians might assume are locally owned. For instance, over three-quarters of BHP’s ownership is foreign, while Rio Tinto has even higher foreign ownership at 83%. These two giants alone represent 70% of the resources held by mining companies listed on the Australian Stock Exchange.

Over the past decade, mining companies have poured over half a billion dollars into lobbying efforts targeting Australian governments. This figure, which exceeds $541 million, only accounts for spending through major industry groups, which are largely controlled by overseas interests. The amount spent on lobbying is likely much higher, as it does not include direct lobbying expenditures by individual mining firms, which aren’t required to be disclosed publicly. This situation raises questions about the influence of foreign interests on Australia’s resource policies and the distribution of benefits from the country’s mineral wealth.

Taxpayers

Australian taxpayers have almost unknowingly lost a minimum of $162.4 million in the past 10 years because of foreign mining industries’ spending on lobbying. This cost does not include the $65 billion a year that Australia subsidises fossil fuels (IMF). Research shows that the Australian government provides massive hidden support to fossil fuels, totalling around $55.6 billion in indirect subsidies. These costs are ultimately paid by citizens through taxes, to cover the damages that come with fossil fuel extraction such as healthcare costs from air pollution and environmental damage including climate change effects. The International Monetary Fund (IMF) has raised concerns that current pricing systems failure to account for these environmental impacts properly, and sometimes do not even cover basic production costs. The health impacts are particularly severe, data from the Institute for Health Metrics and Evaluation shows that air pollution from burning fossil fuels leads to approximately 4.5 million early deaths worldwide each year. Countries like Norway, charge far more for their natural resources, while in Australia we subsidise their extraction.

Australia would be in a dangerous position if we relied on the low-employing, tax-avoiding, high-polluting, and largely foreign-owned mining industry for economic security.

By having politicians in their pockets these mining companies can get tax laws that benefit them rather than the Australian people. The mining industry directly and indirectly abuses its power for private gain, which is the very definition of corruption.

• The Australian government successfully recovered $6.4 billion in taxes from big mining and fossil fuel companies last year. This record-breaking collection included major payments from companies like Rio Tinto and Ampol, who had to settle their dodgy tax-avoiding. The ATO has labelled the gas industry in Australia as ‘systemic non-payers of tax’. These are situations that have been caught but the issue seems to be bigger than is seen in the media.
• The NSW Independent Commission Against Corruption has said that Australia has directly experienced serious political corruption in the granting of mining licences –recommending prosecutions for misconduct in public office (now underway) against former senior State politicians and the relevant Minister for favouritism in the granting of coal licences.
• Santos has been accused of covering up the severity of an oil spill that allegedly killed dolphins off Western Australia (WA) in early 2023. Whistleblower provided picture evidence of dead dolphins near the Santos oil spill and it is said to be internally understood that the deaths were linked to the spill.

Regional Development Australia

Economic modelling commissioned by Regional Development Australia found that reducing the Hunter region’s coal industry would have minimal economic impact. Employment would only decrease by 0-1.2%, while economic output would fall by just 0.2-4%.

Contrary to common belief, expanding coal operations is not vital for the Hunter’s economy. Reducing coal production could benefit the region through improved air quality, better public health, and growth opportunities in other industries while maintaining stable state finances.

The Hunter Valley region despite having green-lit multiple mines, is at risk of suffering the same fate as historical transitional regions. All of Australia’s coal stations will shut by 2038, under the latest market operator projections.

2023 saw the closure of AGL’s Liddell Power plant and the final coal extracted from Muswellbrook Coal after 115 years of operation. BHP has announced the closure of its Mt Arthur coal mine in 2030 and Bayswater is set to close before 2035 as a result of global companies adjusting their portfolios and operations away from fossil fuel and carbon generation.

Australia’s climate policy front is only emphasised by the approval of three coal mine extensions in the Hunter Valley: Whitehaven’s Narrabri Stage 3 Expansion, MACH Energy’s Mount Pleasant Optimisation, and Glencore and Yancoal’s Ashton-Ravensworth Extension. Since labour has come into power 7 new coal mines have been approved. Such projects are forecast to emit over a billion tonnes of pollution in their lifetime, with Mount Pleasant in the Hunter Valley becoming Australia’s largest black coal mine. Such expansions completely undermine the environmental movement and take two steps backwards in terms of energy production and industry shift.

There is a lack of government incentive to support a transition within these regions, effectively leaving communities ‘high and dry’. In the coal town of Muswellbrook, with an increased local coal production of 810 million in coal royalties (2024), there has not been a matching by government bodies to ‘fatten up’ the royalties for rejuvenation fund, a fund that is expected to ease a community transition with a mere 25 million being pledged and minimal conversation surrounding the “toe in the water” commitment to hydrogen within the hunter (Reynolds, Mayor of Muswellbrook).

The mining industry encourages a one foot in one foot out approach to labour and policy which trickles down and impacts the stability of the community. Infrastructure like roads, schools, community centres are all built around the needs of the large percentage of minors who live in Muswellbrook for short periods of time. As a result, those who are not working in the mines often draw the short straw with things like health, environment, and social unity being compromised. Drugs, domestic violence and obesity are also huge problems in Muswellbrook, driven by low socioeconomic conditions.

If the mines generate billions then why isn’t more money funnelled in to the community?

This reflects a larger trend prevalent in the relationship between the domestic and international flux of the mining economy. These mining companies do not have our mining communities in mind. They only care about their private gain and the government has become an extension of that. With no transition in place for these communities set out by the government and no legislation to enforce these companies to take responsibility.

Jobs disappear, tax bases dry up, housing prices collapsed, services erode, and people move away and mines are left open waiting to become a water pit of dangerous chemicals (Macneil, 2021). Economic shocks have even been seen to usher a range of social problems like intergenerational poverty, suicide and substance abuse, increasing problems already all too known in the community (Beer, 2018).

Transition

To combat misfortunes brought by the decline in coal, actors have pushed the notion of ‘just transitions’ (JT) whereby policies targeting to help these regions maintain their social and economic integrity. Initiatives include retraining for displaced workers, early retirement incentives for older workers, laws preventing forced redundancies, and transition programs designed to help families through periods of unemployment (see e.g., Briggs and Mey, 2020; ACTU, 2020; Crawford, 2020; CSIRO, 2019; Government of Queensland, 2021; Government of NSW, 2020). Studies that support this promising idea p .119) to help replace the economic stimulus provided by coal.

As our economy transitions, the Shire is well placed to leverage existing infrastructure, location, industry capability and pioneering spirit to position the region as a key centre of renewable energy production, clean technology, innovation and advanced manufacturing as we move towards a Net Zero economy.

Muswellbrook will lead and enable the delivery of green energy to the grid, through wind and solar projects, the Santos Hunter Gas Pipeline and Pumped Hydro, battery storage and hydrogen generation. The Hunter community is committed to working with Energy Co. to deliver on the Hunter Renewable Energy Zone and with the Department of Regional NSW on the AGL Liddel and Bayswater transition.

A study by MacNeil & Beauman (2022) interviewed 37 workers from Australia’s two largest coal regions – Queensland’s Bowen Basin and New South Wales’ Hunter Valley to uncover what people thought about JT. The most common finding was that JT was a euphemism for job loss with no real plan, driven by outsiders and takes away local autonomy. The research project brought up important principles that need to be addressed to properly move away from coal in a just way.

We have heard your priorities:

1. Prioritising Local Autonomy
   1. Long-term improvements with no dependency on mines/ corporations.
   2. There has been positive attitudes to diversifying the economy.
2. Honest Conversations
3. A clear, well resourced plan
   1. Outline of local and national initiatives
4. Health of Community and the Environment
   1. Working with Australian Indigenous communities

Clear Plan

Future Industries

Mining remains crucial for supplying the minerals needed for clean energy technologies. Australia presents itself as a resource rich nation with an ample extractive economics industry that can be recycled to support an energy transition. The expected demand for mining resources that are required within the sector is predicted to exceed 700 million tonnes annually by 2050.

• 9 million tonnes of lithium for energy storage
• 130 million tonnes each of silicon for EVs and copper for wind turbines
• 48 million tonnes of nickel for batteries

Australia is the world’s largest producer of lithium, third largest producer of cobalt and fourth largest producer of rare earth. By 2030 electric vehicle will represent more than 60 per cent of vehicles sold globally (IEA 2022b). Demand for battery minerals, such as lithium, is forecast to increase by 40 times 2020 levels by 2040, while demand for cobalt and graphite could rise by approximately 20 times. Demand for rare earth elements could increase by seven times in the same period (IEA 2021). More mining is required to meet this demand. Recent analysis by the IEA suggests the world will need around 50 new lithium mines, 60 new nickel mines and 17 new cobalt mines to meet carbon emissions goals by 2030 (IEA 2022a). Showcasing massive potential for industry growth and employability for Australian workers.

Australia had 81 major critical minerals projects in the pipeline as of December 2022, with an estimated value of between $30 billion and $42 billion. This is up from 71 projects and $22 billion to $36 billion in 2021 (DISR 2022). The Australian government has committed $23 billion to boost domestic manufacturing and renewable energy, focusing heavily on critical minerals processing and refining. This investment aims to establish Australia as a global leader in critical minerals production. Thus, the extractive economics that Australia has been built on, need not be cut off drastically, a subtle shift may lay the foundations for a sustainable energy industry to be built upon within Australia.

The critical minerals industry needs many skilled workers and can provide the shift necessary towards renewables from the mining sector. Australia’s resources sector employs more than 290,000 people (ABS 2023) and accounts for 14 per cent of our GDP (Office of the Chief Economist 2022). Emerging critical mineral sectors are the transfusion into a clean energy industry. Independent government modelling found that the increased export from critical minerals could create more than 115 000 new jobs, growing to 262 600 jobs if Australia builds on its downstream refining and processing capabilities. The transitional capabilities for employment from non-renewable mining sectors is vast with clear profession mirroring between industries in terms of exploration, management, engineering, science and trade sectors.

Australia’s critical minerals are imperative to a net-zero transition, they are also imperative to shifting away from an international reliance on clean energy infrastructure and resources. Australian coal mining exports are dependant on buyers like China, but this drastic global shift towards renewables is seeing China expand their own renewables energy sectors and more self-reliant, manufacturing approximately 80% of the world’s solar panels in 2022.

The global community is yearning for critical minerals. The EU energy consumption is rising and in need of politically stable outsourcing of energy. The EU has made available 500 billion AUD of equivalent funding and simplify shortening permitting processes for renewable projects.

The potential for future Australian businesses and ex-non-renewable employees to transition skills is limitless.

Employment

In NSW, we have a wealth of highly skilled tradesmen, engineers and entrepreneurs. The NSW government has created a 2030 renewable energy workforce plan, looking to fulfil Australia’s future energy needs with large investment into electrician and engineering sectors. There are 38 critical employment sectors for a clean energy transition, with all sections relying heavily on overseas employment, engineering boasting over 50% international employment. The clean energy council reports that an increase from 21,500 to 59,300 workers is needed to build and operate the generation, storage and transmission infrastructure required to achieve 82 per cent electricity in the National Electricity Market by 2030. Currently Australia is not investing heavily enough into grassroots clean energy programs, despite having a massively pre-established industrial sector that has been sharped over decades of mineral extraction.

The potential for this highly skilled workforce to transition to clean energy, an industry that is in need of ground up development, is limitless and would ensure the immediate development of a clean energy employment backbone. In 12 regions across Australia, workers make up more than 2% of the local community. Introducing the possibility for a workers void that if not plugged could have drastic socio-economic community effects. Within the upper hunter valley over 11% of the populous is reliant on an extractive and dead industry, but with the skills to industry shift with relative ease. Mining firms are gatekeeping employees and thus, preventing them from expanding into the emerging clean energy sector, which is limiting Australian workers as international specialists ‘snap’ up jobs.

Muswellbrook transition

The Muswellbrook region currently has ‘supposed’ commercial backing for multiple clean energy projects, despite the lack of initiating speed such projects are in the pipeline and will provide jobs in construction and management. At the forefront is the proposed 400 MW 8-hour storage Muswellbrook Pumped Hydro plant is expected to provide power and grid support services at critical times, pumping water uphill when there is excess energy from solar and wind and releasing water to generate power in times of high energy demand.

No other projects are green lit, calling for a community nudge to get more clean energy projects approved in Muswellbrook. By doing so, the town can be kept alive, healthy and be leaders in sustainability.

How Can I Upskill?

There are existing programs for up-skilling. Up-skilling is the process of increasing a potential employees skill set. building on the skills you already possess within the mining sector and shifting them to a more renewable focused skill repertoire. For programs that create jobs see below for local and national:

Unions

Union engagement in Australia has decline significantly, falling from over 50% of the workforce in the 1970s to approximately 15% today. This decline has reduced workers’ collective bargaining power and their representation in workplace negotiations, potentially impacting their ability to advocate for better wages, conditions and protections.

There is currently no dedicated union specifically focused on the renewable energy sector. This gap in specialised representation could affect worker attraction and retention in the growing clean energy industry, particularly as the sector requires unique skill sets and faces distinct workplace challenges. A dedicated clean energy union could potentially help standardise industry practices, advocate for specialised training programs, and ensure fair wages and conditions as the sector expands.

What’s All This All Change About?

Climate change is caused by burning the limited resource of fossil fuels. Climate change is the long-term change in temperatures and weather patterns which scientists agree humans have primarily been responsible for in the last 200 years. The main contributors include the burning of fossil fuels like coal, oil and gas. When fossil fuels are burnt they release what is called greenhouse gas emissions into the air that suffocate the Earth by trapping the sun’s heat and raising temperatures.

Muswellbrook is a pillar of the Australian NSW coal mining sector providing energy to greater NSW for the better part of 3 decades. The effects of climate change continue to knock at the door of this community. With the bushfires of 2023 licking the heels of Muswelbrook, Aberdeen, Scone and the surrounding regions, the increased rate of natural disasters is the symptom of the disease that is Co2 emissions, a disease that is now reaching the industrial organs of the state and the people that embody them.

Severe fires within the hunter region are expected to increase. Fire weather was the strongest determinator of house loss during the black summer bushfires, jeopardising local infrastructure. The 2019 bushfires in south eastern Australia triggered around 65000 displacements and destroying more than 3,100 homes. Under the high emissions scenario, the number of severe fire weather days is expected to double by 2090. The Upper Hunter region saw 22,7000 hectares of the region impact with 15,663 buildings destroyed. The longterm infrastructure effects of fires can result in recovery and rebuilding taking over 2 years.

The direct health impacts saw 2 saw 25 premature deaths, 38 cardiovascular disease and 129 respiratory disease hospitalisations across the region from poor air quality caused by the bushfires in the 2019-2020 season.

Lobbying and How to Do It Effectively

Lobbying involves contacting legislators and convincing them to support or reject policy. Whether you are an individual constituent or an advocacy group, when you meet with representatives in an attempt to elicit a policy change, you are lobbying them. Lobby against fossil fuels means going against the very foundations that much of Australia’s industry was built on. Lobbying with a community lens is far more effective. By utilising Grassroots lobbying you raise awareness about coal and transition issues that your advocacy collective and community wants to rectify and then use this as a channel to influence the lawmakers’ stance.

Your goal is to encourage and enable supporters to reach out to their representatives through email, direct mail, social media, telephone to share their stance on an issue. The best way to do that is through patch-through calls. Patch through calls involves connecting voters with their elected representatives, and thus, pushing and connecting calls between voters and their representatives. Instigating change through the phone line.

Get Involved

There are many ways to support Geophyte’s mission:

• Volunteer your skills
• Make a donation
• Partner with us
• Spread awareness about our work

Join us in nurturing the potential within mining-dependent communities, helping them grow strong roots for a sustainable future.