The bitter industrial war engulfing the Port Kembla Coal Terminal has its roots in high fees there causing some mining companies that own the terminal to use Newcastle instead.
About 60 workers have been locked out by terminal management in what the company said was its way of dealing with a week of start-stop union industrial action. Coal is being loaded by a “contingency workforce” while permanent workers picket outside.
But the core of the dispute goes further than negotiations for an enterprise agreement. Even though international mining giants Peabody and Glencore are part-owners of the Port Kembla terminal, the Mercury has learned from multiple sources that they have been sending their coal by rail to Newcastle for export.
Port Kembla Coal Terminal (PKCT) is now determined to cut costs so it can stay in business and has applied to terminate the workforce enterprise agreement so it can make changes to entitlements.
In January leaked documents showed PKCT had been considering slashing staff and replacing them with South32 employees.
But industry sources say it was the high levies introduced to pay for expensive infrastructure works that have driven PKCT’s own customers away, creating income shortfalls.
PKCT operations manage John Gorman revealed last month that the facility’s throughput was forecast to fall by half for 2018, to 5.1 million tonnes. This was down from its peak times of 14 million tonnes several years ago when all mines in the region were producing.
Mr Gorman told Fairfax Media this was because major miners were increasingly opting to send their coal more than 250km to Newcastle because exporting through Port Kembla cost about three times as much.
“There are some significant risks to that at the moment and we need to be doing everything we can - and having a competitive enterprise agreement is a significant element of that,” Mr Gorman said.
On Friday he told the Mercury PKCT had “taken steps to ensure operations can continue safely in a restricted manner” amid on-off industrial action. “A team of professionals is operating the terminal to ensure the safe delivery of products by rail and road, to load the ship at berth for a customer and to keep the Illawarra exporting,” Mr Gorman said.
PKCT is owned by South32, Peabody, Glencore, Wollongong Coal and Centennial Coal, and managed by South32. Throughput has also been dragged down by Wollongong Coal’s inactivity and gas-related problems at South32’s Appin mine.
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