Advance Australia Fair - Building Sustainability, Justice and Peace
Workshop - Jobs and the environment
Sunday 31st July 2005

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Jenny Warfe

Blue Wedges Coalition

CHANNEL DEEPENING IN PORT PHILLIP BAY- IS IT SUSTAINABLE?

PORT PHILLIP BAY

• The bay is a virtually enclosed system; a natural icon around which most Victorians live or at least are familiar with.
• The major ports of Geelong and Melbourne are located in the Bay.
• The North-western coast is characterized by extensive saltmarsh areas.
• The northern ‘industrial’ end is characterized by major freshwater and nutrient inputs from Werribee Treatment Plant and the Yarra River.
• Residents use eastern beaches all year; the wider community in Summer.
• The southern bay is noted for biodiversity, marine parks, ecotourism.
• Recreational fishing is a major beneficial use throughout the bay.
• Commercial fishing dates from the mid 1800s

THE PROPOSAL

• The proposal for capital dredging of 32 million m3 of material over 91 weeks is unprecedented in scale.
• Maintenance dredging (and associated disturbance) of a further 11 million is required over the life of the project.
• Spoil is to be disposed in ‘designated’ areas in the bay.
• Multinational shipping interests are the major financial beneficiary to gain $1.32 billion over the life of the project.
• At this point it would appear that the full cost (estimated c. $550 million) will be paid by the State of Victoria.
• There are no guarantees that the international shipping interests will continue to patronize the Port of Melbourne in the longer term as other Australian or regional ports present more lucrative propositions.

AREAS DIRECTLY AFFECTED

• The north and south sites are ecologically unique ‘transition zones’ where neighbouring ecosystems overlap. Freshwater flows from the Yarra merge with marine waters in Hobsons Bay. The relatively enclosed bay system merges with Bass Strait at Port Phillip Heads.
• Such ‘ecozones’ are typically biodiverse.
• The existing spoil ground in the north central bay area (8 km west of Ricketts Point marine Sanctuary) will receive 15 million m3 of spoil including at least 2 million m3 of contaminated spoil.
• New spoil ground north-east of Hovell Pile is to receive 28 million m3.
• Some major issues with spoil grounds are turbidity, smothering of seabed organisms during deposition; leaching of toxins to the wider bay.
• Some major issues with northern dredging are turbidity and associated interruption of photosynthetic processes, potential toxic algal blooms, disruption of fish spawning, potential clogging of gills, resuspension of toxins into the food chain, failure of nutrient cycling process, potential deoxygenation of water and resultant dieback of organisms.
• Some major issues with southern dredging include turbidity, potential dieback of seagrasses, noise associated with rock removal, and overburden smothering substrate below.
• The deepening at the Heads will increase tidal regimes around the bay. Longer term probability & costs of beach erosion have been ignored.

WORKS SCHEDULE

The only basis provided as to scheduling of works over a 2 year period is to avoid the summer tourism peak in the south of the bay.

The northern works coincide with penguin breeding season, anchovy spawning in Yarra estuary, seasonal heavy rains that typically flush high levels of nutrients into the north-eastern bay area; and greater average daily hours of sunlight that will maximize algal blooms.

CURRENT STATUS

• Planning Panel has listed 128 matters that need further work to ensure environmental risks are adequately addressed.
• Government has ordered a Supplementary Environment Effects Study, the guidelines for which are yet to be released.
• The Panel recommended ‘Trial Dredging’ be conducted near Port Phillip Heads to monitor impacts, but did not limit the extent or timing of the ‘trial’.
• ‘Trial’ dredging began in early August and is expected to continue till late September.
• A massive rockfall to at least 37 metres depth occurred at some time during the trial dredging at The Heads (canyon area), which the PoMC reported on the final day of dredging in that area.
• Rockfall below 20 metres was an Environmental Management Plan “threshold” for ceasing the trial.

ECONOMIC DISCUSSION

On questioning the claim that the Port of Melbourne directly provides 80,000 jobs, the Planning Panel was told the actual figure is 18,500 direct and indirect jobs. Despite this, advocates for the project continue to refer to 80,000 jobs. It appears this figure may be an estimate of what might occur if the Port ceased to exist entirely – and all trade was lost to another State- obviously an entirely fallacious outcome.

Is Channel Deepening critical to Victoria’s long term economic future?

According to Meyrick and Associates (PoMC’s own economic analysts) “Trade growth through the Port of Melbourne will continue at essentially the same rate, irrespective of whether deepening proceeds”. Meyrick and Associates predict a quadrupling of trade through the Port of Melbourne over the next 25 years, irrespective of whether or not the channel is deepened.

They believe that shipping companies will continue to adapt, not by going to other ports but by continuing to use medium sized ships rather than big ones.

Very recently (22nd September 2005) the Drewry Report was cited in The Age. This document was before government when it gave its ‘in principle’ support to the project in 2002, but had to be obtained under a recent FOI request. The Drewry Report is described by Infrastructure expert Peter Fitzgerald as a rigorous non biased report. It shows that the projected benefits from channel deepening are much more modest than claimed by Meyrick. Drewry estimates gains by 2030 to be US$30m whereas Meyrick estimates gains by 2030 at $334m. This is a massive “blow out” which requires careful re- examination.

For any project posing such serious environmental risks, the economic case needs to be overwhelming. The onus must be on the proponent to prove an overwhelming economic need for the project, before approval is given.

Whilst “the acceptance of a sound financing strategy for the project” is cited as a proviso for in-principle government support, a rigorous analysis of the overall benefits and disbenefits of the project is yet to be shown.

Examples of industries that will be adversely impacted include:

• Newport Power Station
• Aquaculture/abalone industry (worth $3.7 million per annum, supporting 140 jobs)
• Recreational fishing industry (worth $200 million per annum and supporting 1800 jobs.
• Commercial fishing industry (worth $3 million per annum)
• Recreational boating
• Beach and Bay Tourism
• Diving industry
• Ecotourism/Bay swims
• Phillip Island Penguin Parade

So, plenty of good sustainable jobs will be threatened if the project proceeds, whilst the ever increasing importation of goods which this project facilitates will put other Australian workers out of a job. There is no clear evidence that sustainable long term jobs will be created as a result of this project.

The following are areas, highlighted by the panel to be addressed:

• The need to review the actual economic “necessity” for the project. i.e. the panel questioned the claim that only 30% of the ships are currently entering fully loaded (p284 Para 5). Melbourne’s position at the end of the international trade routes means some cargo will be off-loaded at other ports.
• The loss of potential for growth in the affected industries (e.g. the aquaculture industry) needs to be properly calculated (page 302-303).
• The cost of maintenance dredging needs to be included in the cost analysis (p283).
• The need to work within the Government policy framework that clearly sets targets for Nitrogen reduction. (p285 para 7). Taxpayers have spent $$ millions on reducing Nitrogen (nutrient) levels in the Bay, only to have the channel deepening project increase those levels.

The proponent should identify all services, structures and infrastructure that may be affected by the project. These include impacts on/works to structures including:

o non commercial structures in the Port
o operational wharves in the Port
o the Ethane pipeline
o The Westgate Bridge” (p331, para 1)

The Westgate Bridge was identified as not having been built to withstand impact from a ship the size of those now intended to pass beneath it if the project proceeds. The Port of Melbourne’s suggestion at the Panel Hearing was to advise VicRoads of this.

These assessments need to be completed and costed as part of the EES, so that the associated costs can be factored in to the overall cost of the project.

Financing

How the project is funded warrants full and proper research and public debate.

The primary beneficiaries of this project will be the international shipping companies – and we are left to rely on the “trickle down” effect to realise those savings. Few direct benefits will go to Victorians, however all the adverse impacts will be borne by Victorians.

Since there appears to be such a strong belief that this project makes real economic sense, let it be tested in the real market place. This means no more government funding or guarantees.

Do the alleged economic benefits outweigh the disbenefits?

WHERE TO NOW?

1. Request that Government seeks independent assessments of the economic and employment impacts of the proposed Channel Deepening Project in Port Phillip Bay
2. Request that Government seek solutions alternative to the Port Phillip Bay Channel Deepening Project for problems resulting from increased container traffic in and out of Victoria
3. Demand that Channel dredging not result in mobilization of, or disposal of toxic sediments within the marine environment

More information

Blue Wedges Coalition www.bluewedges.org

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