MOUNT Isa State MP Rob Katter said there is a “death spiral” on the rail as mining companies in the North West Minerals Province use roads to transport product.
It means the government owned Queensland Rail covers the costs for the Mount Isa rail corridor by further increasing the prices for the customers remaining.
Companies including South 32, MMG, Incitec Pivot and Capricorn Copper met with State Treasurer Curtis Pitt in Parliament House last Thursday to discuss the issue.
State MP Rob Katter, Minister for State Development Anthony Lynham, Townsville Enterprise and local development group MITEZ were also involved in the discussion.
Mr Katter said that Queensland Rail was running a monopoly on the track and this was obstructing its own business sense.
Mining companies were discouraged from reloading carriages when returning to its original location – known as back loading – and this was part of the issue.
“They (Queensland Rail) are trying to act like a commercial entity and they are not working commercially at all,” Mr Katter said.
“Every tonne that goes down the road means loss of revenue for you and I as taxpayers. We earn no money from that ore going down that road.
“But we earn money every time, around $20 a tonne, when it goes to Townsville.”
Mount Isa to Townsville Economic Zone (MITEZ) chief executive Glen Graham said both cabinet ministers “responded well” to the mining companies’ more practical suggestions which would work for both the customers and Queensland Rail.
They gave the impression that they would soon respond to the suggestions, Mr Graham said.
“The formula for establishing the charges needs to be designed to also entice users as well as provide a revenue,” Mr Graham said.
“And there were suggestions on how that could be done. It was more to do with how the service could be provided in another way that would provide greater benefit to the user.
“Some people had ideas to say if ‘you (government) were more flexible we would be happier’.”