By Lucy Battersby
A LARGE Queensland pastoral farm used for wagyu cattle breeding is set to become a coal mine after Australian Agricultural Company (AAC) agreed to sell a property to mining company Xstrata.
The global miner will pay $21.6 million cash for the 17,474-hectare Meteor Downs property without any cattle or machinery.
It completes a decade-long encroachment by Switzerland-based Xstrata on to AAC's property, having previously bought a south-eastern corner of Meteor Downs for the Rolleston Coal mine.
AAC says that the price was "well in excess of the book value" of the property, which was used as a stud farm but had become a non-core asset.
The money would be reinvested in other business areas, such as grazing land and a beef processing facility in Darwin, managing director and chief executive David Farley said ahead of the company's half-year results this morning.
But Mr Farley was also critical of mineral rights laws that he said gave mining activity priority over farming. "If Australia wants to sustain its agricultural services, it needs to have a proper audit and have a clear understanding of the impact of mining and coal seam gas," he said.
Xstrata recently received federal approval to double accommodation at the Rolleston coal mine for up to 700 workers.
An application to expand mining operations still requires environmental approval because it could affect the Fitzroy River, which flows out into the waters of the Great Barrier Reef.
"The [Rolleston Coal Expansion Project] is planned to consist of between five and 10 open-cut pits that are either extensions to the existing Rolleston Coal operation or adjacent to the existing Rolleston Coal operation," an application lodged on May 17 states.
Xstrata hopes to start mining the expanded Rolleston Mine by 2015.