THE 98-year lease of the Port of Newcastle is likely to be finalised any day.
With Port forecast earnings of $69million a year, a deal at 15-times earnings is tipped that would see more than $1billion raised for NSW.
Why does the NSW government decline to reveal whether a condition of the lease is that there will be no container terminal built on the former steelworks site?
Why, too, does the government decline to reveal whether a condition of the Port Botany lease is that there will be no container terminal at the Port of Newcastle?
With 25per cent of the NSW population living north of Sydney, a container terminal at Newcastle would reduce Port Botany container movements by about 25per cent and provide stiff competition.
But the NSW government has made a decision to disadvantage northern NSW by maintaining the Port Botany monopoly.
Containers holding goods for northern NSW are trucked from Port Botany to western Sydney where the goods are removed, loaded on to different trucks, and then trucked to Newcastle for distribution.
It is an unfair cost burden on the people of northern NSW.
Exporters in northern NSW suffer a double whammy. Products they make for export are trucked to western Sydney, where they are loaded into containers that are trucked to Port Botany. Reliance on trucking is a major disincentive to investing in manufacturing for export in Newcastle and northern NSW.
A container terminal at Newcastle would encourage job-creating manufacturing for export by providing direct access to a container terminal at low cost.
A container terminal would justify building a rail freight bypass of Newcastle and Sydney. Freight trains would be removed from the Newcastle rail line.
The alternative is to spend $4.4billion for upgrading the Northern Sydney Freight Corridor, between Strathfield and Newcastle, by 2028 just to keep pace with demand. Neither the state nor federal governments have the funds.
The capacity of the Port Botany rail freight line is woefully inadequate.
Even if upgraded, there is only sufficient capacity to rail 1.2million twenty-foot equivalent unit (teu) containers between Port Botany and a proposed intermodal terminal at Moorebank in south-western Sydney.
Last year, there were 1.7million teu trucked between Port Botany and western Sydney.
Work must start immediately to build a new intermodal terminal at Eastern Creek, which is closer to the main demand areas for freight. The Western Sydney Freight Line must be built to link Port Botany with Eastern Creek.
But a rail freight bypass – between Newcastle, Eastern Creek and Glenfield – removes any need to build the Western Sydney Freight Line or upgrade the Northern Sydney Freight Corridor.
Once Moorebank intermodal terminal is filled to capacity, the growth in container movements will occur by road.
No Hunter region politician has ventured a reason as to why the NSW government is preventing a container terminal in Newcastle.
Greg Cameron is a public affairs consultant specialising in regional economic development. He was BHP’s public affairs manager in Newcastle from 1994 to 1999