PERTH, March 11 (Reuters) - Aurizon Holdings Ltd
will partner GVK Hancock to develop rail and port infrastructure
with a capacity to handle 60 million tonnes per year in the
undeveloped Galilee coal basin in eastern Australia, Aurizon
said on Monday.
As part of a non-binding agreement, Aurizon plans to acquire
a 51 percent interest in Hancock Coal Infrastructure, which owns
GVK Hancock's rail and port projects.
"The development of the rail and port infrastructure will
unlock the Galilee Basin and see the development of Alpha,
Kevin's Corner and Alpha West, creating one of the largest
integrated coal development projects globally," G V Krishna
Reddy, chairman of GVK, said in a statement to the Australian
Aurizon Holdings, formerly QR National, is an Australian
rail haulage company. The statement did not say how much Aurizon
will pay for the 51 percent stake.
The announcement comes despite many Australian miners
putting the brakes on large new projects as prices decline and
demand, especially from top coal consumer China, remains weak.
Even GVK Hancock, a joint venture between India's GVK Power
and Infrastructure Ltd and Australian mining magnate
Gina Rinehart's Hancock Coal, has had to delay its $10 billion
Alpha Coal project by one year to 2016.
Australian coal prices have dropped about 15 percent in the
last year to around $90 per tonne and are down 30 percent from
two years ago when they reached around $130 per tonne.
The Galilee Basin in Australia's Queensland state could make
Australia the world's top thermal coal exporter if developed,
but the chances that it will be developed in the short run have
been viewed as slim.
"It is a long way west -- there is absolutely nothing
between the coast and that basin, so there are very high risks
in proceeding with these projects," UBS analyst Tom Price said.
(Reporting by Rebekah Kebede; Additional reporting by Bangalore
Newsroom; Editing by Muralikumar Anantharaman)