The new chair of Newcastle Ports in Australia says there’s an urgent need to diversify the regional economy and the port’s business

Newcastle, the world’s largest coal export port, must “urgently” diversify its traffic, the port’s incoming chairman has said, warning that the “long-term outlook for coal is a threat to the port”.

The move has been received as a significant sign of the transition away from fossil fuels.

Coal makes up about 90% of the New South Wales port’s throughput, including some of the world’s highest quality coal for steel production and electricity generation.

Is this the end of the road for Adani’s Australian megamine? Read more

The pragmatic stance of Newcastle Ports is in stark contrast to the Australian government’s rhetoric on coal, which has sought to subsidise Adani Group’s plans to develop a new coalmining basin in Queensland, and an associated expansion of the Abbot Point coal export terminal on the Great Barrier Reef.

“Coal has been at the heart of the Hunter’s economy for the better part of two centuries, and it will continue to be central to the prosperity of the region and Port of Newcastle for some time to come,” said Roy Green, the new chair of the Newcastle Ports board.

“However, there is also an urgent need to diversify the Hunter economy and the port’s business.

“Clearly the long-term outlook for coal is a threat to the port and Hunter region, but it is also a huge opportunity. While the world’s demand for our coal is beyond our control, our ability to invest in new sources of growth and innovation is not. Among our challenges will be ensuring a level playing field for the development of a viable and competitive container terminal.”

The former chief economist of National Australia Bank Rob Henderson said the announcement was “indicative of the seismic shift under way in the world of power generation and investment”.

“Newcastle, the world’s largest coal port, is now transitioning to a lower carbon world and is actively planning for the time when less of the Hunter’s wealth and income will be generated from coal,” Henderson said.

“It should reaffirm to investors that the transition away from coal is taking place rapidly now, that continued investment in Australian coal is a losing proposition in the medium to long term and that diversification is critical.”

The war on coal is over. Coal lost | Dana Nuccitelli Read more

Last week one of Australia’s big-four banks, National Australia Bank, announced it was ceasing all lending to new thermal coal projects. Earlier this month AGL, which owns electricity generation and retail assets and is Australia’s biggest emitter of greenhouse gasses, confirmed it was shutting its ageing Liddell coal-fired power station, despite pressure from the government to keep it open beyond its planned life.

“The Port of Newcastle is following the money trail, by adopting the position taken by major Australian banks, including my former employer NAB, over recent weeks, who have sought to distance themselves from financial ties with new coal projects and focus on the growth industries of the future,” Henderson said.

The port’s announcement was welcomed by environmentalists.

Glen Klatovsky, deputy chief executive of 350.org, called on the government to recognise the fear the transition away from coal would cause, and to manage a “just transition” for workers in the region.

“For a positive future to become reality we need governments to be more focused on a just transition to a post-coal regional economy,” Klatovsky said.

“The Hunter is a beautiful region with an existing tourism industry, agricultural wealth, world-class wineries and horse studs. Newcastle has great education resources, a vibrant health sector and the region has huge potential in renewable energy.”

The chief executive of Newcastle Ports, Geoff Crowe, said Green’s experience made him well placed to manage the transition.

“Professor Green also has a strong understanding of the Hunter region’s competitive advantages, having worked at the University of Newcastle through the 1990s, including close engagement with the BHP Newcastle Steelworks transition and Hunter economic development bodies,” Crowe said.