Steel City, 20 years later: Hopes contained behind the scenes

The history of this languishing site can be read a number of ways.

One is to say that the various versions of a container terminal that have been mooted over the years have not eventuated because the project did not stack up financially or logistically.

And if it never eventuates, that might be history's verdict.

But looking at the bewildering array of twists and turns to the terminal's shape and prospects over the years, it's obvious the project faced considerable opposition from the start.

Commercial interests based in and around Port Botany, who collectively - and understandably from their perspective - did not want their monopoly position as the state's only container terminal disturbed by competition from Newcastle.

Senior government members have tended to say one thing to Newcastle, and then do something else in Sydney.

And as is often the case, support from opposition is not always maintained after a change of government.

The 2003 announcement of Newcastle as the state's next container terminal after Port Botany is a case in point.

At the time, Botany had a limit on its growth.

But over the years, the cap on Botany's container traffic has grown, and was finally removed altogether.

Things only became more complicated after the 2013 privatisation of the state's three ports by leasing, and the Coalition's reversal of Labor's "three ports policy", favouring Port Kembla over Newcastle.

This suited the consortium that bought Port Botany just fine, because they also picked up Kembla in the deal.

When Newcastle was privatised in 2014, the new emphasis was on clipping the ticket on coal ships, and acting as a landlord on portside real estate development.

Even then, rumours were flying that Newcastle's privatisation involved limits on container movements, claims deflected and denied by the Coalition until the Newcastle Herald obtained a leaked copy of a crucial 2013 "port commitment deed" - proving the suspicions true - forcing the government's hand.

The public then learned that the ports had been leased in such a way that the government had given Botany's owners a guarantee they would be compensated for any loss of business.

When Newcastle was privatised, the owners picked up that liability. It must be said that they did so knowingly, but that does not make the deal any more palatable, from this region's point of view.

If the government had been comfortable that such an arrangement would be publicly acceptable, they presumably would have been happy to announce it at the time. But they did not.

And it has taken years and years of chipping away at the edifice of confidentiality that surrounds the deal to piece its various interlocking pieces together.

Here, credit must go to the former BHP public affairs officer, Greg Cameron, who was instrumental in the development of the project during the steelworks closure, and who remains its most determined advocate 20 years on.

Parliamentary questions asked by Newcastle Labor MP Tim Crakanthorp and others have finally forced the government to provide sometimes detailed written answers to questions that might otherwise be fobbed off.

One result of Cameron's labours is a major online data base, Container Terminal Policy in NSW , well worth a read for those interested in the detail of this sorry tale of thwarted development.

At the moment, a degree of tension surrounds the proposed Newcastle terminal - and, indeed, the entire port privatisation process - after the Australian Competition and Consumer Commission took NSW Ports, the operators of Botany and Kembla to the Federal Court, lodging its case in December last year.

After a dozen administrative listings since then, the case has been set down for trial over 29 days in October and December 2020, an indication of the importance and complexity of the matters involved.

The ACCC initially focused its attention on NSW Ports, alleging it entered into allegedly "illegal" and "anti-competitive" arrangements with the NSW government.

Common sense says it's hard to see how the ACCC can say that NSW Ports is in the wrong, but that the government, which is on the other end of the same arrangements, has no case to answer.

Court records show that both the Port of Newcastle (PoN) and the NSW government became "interested" parties to the proceedings. In July, NSW Ports lodged a cross-claim against PoN that meant there were now two matters before the judge, Justice Jayne Jagot.

On August 20, Justice Jagot ordered that the government be added as a respondent to the main case, meaning that it and the operators of all three NSW ports are part of proceedings listed for hearing over 29 days in October and December next year.

The length of time set aside can be viewed as an indication of the complexity and importance of the matters being examined.

On the financial handcuffs slapped onto PoN, there's an irony that has been reported elsewhere but little remarked upon in Newcastle.

It's the understanding that the concept of protecting Botany with the Newcastle fee was first put to the government by a company in the losing bidder, which then went on to be part of the winning bid for Newcastle.

If nothing else, it may help explain why PoN showed little interest in talking about a Newcastle container terminal before the present management - chairman Roy Green and CEO Craig Carmody - kick-started the port's renewed interest in the project.

All of this is interesting enough from a spectator's point of view, but what does it mean for the people of the Hunter, given the weight that BHP gave to the terminal and the related Steel River project, as its parting presents to the city that helped it rise to the mantle it held for many years as Australia's biggest company?

One answer is to say that this massive 150 hectare site is virtually still undeveloped, with the exception of some industrial installations at its western end, and some improvements to a former steelworks berth, now known as Mayfield 4.

Although there was little weight given to linking the two at the time, Cameron says Steel River and the terminal were conceived as complementary projects, which was why BHP was pursuing Free Trade Zone status for an import-export focused Steel River.

The Howard government later bestowed a "Manufacturing in Bond" (MIB) status on the site, but this soon faded into history along with various initiatives that went a promised "2000 jobs by 2000" at Steel River. Government records show MIB was "terminated" in treasurer Peter Costello's 2007-08 mid-year economic statement.

Steel River itself is probably best described as a partial success.

A number of apparently happy clients, including the CSIRO's landmark energy research division, are set up there, but the land, although remediated by capping, was a toxic steelworks dump for decades before, and contamination concerns resulted in a complicated sales process and caused problems with lenders, at least initially.

Steel River was also envisaged as having an easement created along its boundary with the Hunter River to allow a rail line or lines to join the container terminal site and the main northern rail line at Hexham.

Sydney-bound containers and returning empties would go along a long promised by-pass to Fassifern, keeping the lengthy container trains away from the Clyde Street and Adamstown gates in particular, and suburban Newcastle in general.

The promised corridor seemed to fade away during closure time, but recent EPA documents indicate a 20-metre wide easement was kept for potential remediation works.

The PoN plan, however, involves the existing rail system, as well the container trucks that bedevilled Jodi McKay at the 2011 election.

There were never supposed to be great licks of government money going into this, but the blocked Anglo Ports proposal had the shipping giant Maersk backing it, and PoN is a 50/50 partnership between Chinese company, China Merchant Ports, and Australian infrastructure investment funds overseen by Macquarie Bank.

These are not small players.

The next few months may prove crucial, with observers watching for a commercial settlement between NSW Ports and PoN.

The alternative could be a whole lot of dirty political and commercial laundry unveiled in a Federal Court case in which the documents are presently stamped confidential.

Meanwhile, the red tractor completes its steady laps of the site.

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