Anglo American invests in CQ
AUSTRALIA may be a risky place for mining giant Anglo American to put its money, but Central Queensland was still given a thumbs-up.
In fact, even Anglo American global chief executive Cynthia Carroll trumpeted its new Central Queensland mine, as it released the company's interim results on Friday.
Anglo owns five mines in the Bowen Basin, west of Mackay, and Rockhampton - Moranbah North, Capcoal, Foxleigh, Dawson and Callide.
Investors in the multi-billion-dollar Goliath were shown information during proceedings that found Australia had five of the possible seven "key risks" to investment - taxes and royalties, access to workers, lack of infrastructure, community opposition and the approval process.
The only two earn ticks were its ability to supply water and electricity to mines.
Only the Democratic Republic of Congo was deemed riskier than Australia.
South Africa, Chile, Peru and Guinea scored the same ranking while Canada, USA, Brazil, Philippines, Indonesia and Mongolia had fewer risks.
Although the news appeared grim, Ms Carroll shone a light on Anglo American's emerging Grosvenor project near Moranbah in her speech to investors.
She said Anglo was focusing on areas with "the most attractive market dynamics and projects with the lowest execution risks".
"The five million tonne per year Grosvenor metallurgical coal project in Australia is well under way, with engineering work now 50% complete as of July 2012 and earthworks have begun," she said.
In a statement, the company described the mine as a major part of its plan to triple its steel-making coal mining by 2020.
Anglo has even begun the early studies into expanding the project, even before the mining starts.
It is a strong sign of confidence in the Queensland mining industry - Anglo's profits for steel-making coal in 2012 fell 68% compared to the first six months of 2011.
Even moving more in exports was not enough to cushion the blow dealt by falling coal prices.
Ms Carroll said even as the economies of Europe and the US struggled, and China, India and Brazil were coming off the boil, these challenges would pass.
Supply for most minerals, whether coal, platinum or iron ore, would still be unable to keep up with the demand coming from emerging middle classes of China and India, which in turn would send prices up again.