Northern Australia. It covers around 45% of the Australian continent but is home to around 5% of the population.

Much of the north is divided into the “dry” and the “wet”, putting pressure on truckers delivering goods to remote communities using dirt roads that become unusable in the wet and have to contend with cyclones that regularly cross the coast.

Much of the heavy lifting of the coal and critical minerals being mined in the north is dependent on rail networks operated by Aurizon. Australia’s largest rail supply chain for export coal, the Central Queensland Coal Network, with 2670 kilometres of track connects more than 50 mines to five export terminals located at three ports.

In Darwin, Australia’s northernmost major port connects the dots with road and rail leading to the port. The city is tantalisingly close to Asia and the trade opportunities that come with it.

It isn’t all economic plain sailing in the Northern Territory though. Treasurer Tim McManus says the territory faces significant economic and financial headwinds. 

In a 28 October update he outlined what he saw as the territory’s challenging financial situation, as well as an update on the fiscal and economic outlook for the years ahead, including the importance of boosting private sector investment to reduce reliance on public spending.

The under treasurer said the newly elected government was already implementing some key election commitments aimed at growing the economy, supporting local business and bolstering confidence, including payroll tax reforms and the HomeGrown Territory grants.

Treasurer Bill Yan said private investment needs to be encouraged back into the territory for the economy to rebuild.

“From this point onwards, we need to ensure every dollar of public expenditure is put to good use, budget discipline is enforced, and we are a destination of choice for private investment once more,” Mr Yan said.

Those concerns were highlighted in November when Mr Yan raised concerns about the financial standing of the Darwin Port and suggestions were raised that the 99-year lease held by Chinese company Landbridge should be scrapped.

The port denied it was in financial trouble, claiming it was in better shape than it had ever been.

The maritime industry is a critical element in the territory’s economic plan and a blueprint has been developed to grow the industry.

Investment Territory, which launched the blueprint in July, aims for it to grow the maritime industry and become a leading hub for maritime, service, supply and sustainment in the Indo-Pacific region over the next 10 years.

Darwin Port joins transport dots

Darwin Port is strategically located as the closest large port to Australia’s major trading partners and is promoted as the nation’s “northern gateway” to these markets. The port’s location in relation to these markets provides exporters and importers with real time savings in delivering products to customers due to the significantly shorter shipping times.

The maritime sector provides critical services such as shipping, commercial fishing, defence, border force, cruise ships, charter vessels, recreational boating, tourism and work boats.

Investment Territory says the territory’s proximity to Asia and its multimodal logistics facilities offer a gateway in Australia for transcontinental trade between the Indo-Pacific and Australia.

Development of the Marine Industry Park, the Darwin Ship Lift Facility and Middle Arm Sustainable Development Precinct expand service and supply and job opportunities and enhance the territory’s role in Australia’s broader maritime industry.

“Recently, the Northern Territory’s maritime industry was valued at $184 million in direct value added,” the blueprint says.

“Under a high growth scenario, driven by the activation of the Ship Lift and Marine Industry Park, and increased exports, this could grow to $374 million in direct value added by 2030-2031.”

Investing in marine infrastructure supports the growth and expansion of the territory’s marine services, defence and energy industries and is expected to unlock additional opportunities for marine maintenance, servicing, engineering, fabrication and logistics.

The Northern Territory ports industry supports more than 10,000 jobs, has an annual international trade value of $13.6 billion, annual international trade volumes of more than 36 million tonnes and is responsible for more than 18% of Australia’s metal and mineral exports by volume (excluding iron ore).

Its annual contribution to gross state product is $9.1 billion.

The port is the primary trading hub for an area of almost 1.42 million square kilometres, which is almost twice the size of Texas or five times the size of the UK.

Darwin Port CEO Peter Dummett said as a result of this geographical setting, it is an extremely diverse service industry ranging from cruise and defence, to agriculture, mining and oil and gas, through break bulk, containers and bulk liquids (among many others).

“There is very little that we do not have the capability to deliver and we take great pride in being able to provide this array of services to our community and stakeholders,” he said.

Darwin Port is operated by Darwin Port Operations Pty Ltd, which is part of the Landbridge Group, a large private company based in Rizhao city in Shandong Province in China, operating businesses in China and Australia. The Darwin Port operates commercial wharf facilities at East Arm Wharf and the cruise ship terminal at Fort Hill Wharf. It is a key support hub for the expanding offshore oil and gas fields in the Arafura Sea, Timor Sea and off the coast of Western Australia.

It is the only port between Townsville and Fremantle with full access to multi-modal transport services, has excellent pilotage and harbour control systems and a seamless supply chain capable of handling containers and general cargo, bulk liquids, bulk materials, live exports and heavy lift oversized cargoes.  

We are the closest port to Asia and have considerable excess capacity to continue to increase trade.

Peter Dummett, Darwin Port

Darwin Port also services cruise ships and naval vessels at the Fort Hill Wharf facility.

Mr Dummett said there had been a significant increase in recent activity among port users, with increasing throughput across most sectors, most notably cruise shipping, oil and gas, petroleum and agriculture.

“This increase in demand is expected to continue with Santos’ Barossa project in full swing as well a number of mineral proponents set to start exporting in the next 12 months,” Mr Dummett said.

The main imports are petroleum and dry bulk items such as clinker, cement and gypsum and main exports are live cattle and dry bulk minerals, which have historically included an array of products such as spodumene, magnetite, ilmenite and iron ore.

The port has dealings with more than 40 different countries with the largest volumes of trade with Singapore, Indonesia and China.

“Darwin Port plays a significant role in Australia’s supply chain, particularly in the NT,” Mr Dummett said.

“We are the only port in the northern part of Australia that has access to multi-modal transport services by being linked directly to the Darwin to Tarcoola rail network.

“We are the closest port to Asia and have considerable excess capacity to continue to increase trade. The port is also a multi-industry port that has the ability to facilitate a large range of different products.”

The port maintains an active asset renewal and infrastructure investment program, spending more than $50 million over the last five years or so.

“The scope of infrastructure investment varies widely, with major projects in recent years including the development of an additional eight hectares of land for bulk ore stockpiles, the refurbishment and life extension of our cruise ship wharf at Fort Hill and the construction of a new shed to provide storage and quarantine inspection facilities. We are also nearing the completion of a project that will deliver around 8000 square metres of new hardstand in close proximity to the wharf.”

Mr Dummett said the port is currently undertaking a master plan that will set out a vision for the development of the port over the coming decades, so it is anticipated that this will pave the way for specific infrastructure development plans.

“More generally, we see a strong business outlook for our services, so we are actively assessing options to develop additional hardstand within the port as well as to provide undercover storage options to support, then export a wider range of bulk materials.”   

Mr Dummett said Landbridge’s ownership of the lease is helpful in engaging with other countries and companies.

“Darwin Port actively engages with a wide range of parties both nationally and internationally to support the growth of trade markets in the Northern Territory. We were recently invited to attend a major ro-ro (roll-on roll-off) conference in [Shenzhen] where we jointly promoted the opportunity to import vehicles into Australia via Darwin in partnership with the rail operator, Aurizon. As part of this visit, a friendly non-binding MOU was signed with [Shenzhen] Port in order to establish a closer relationship between both ports and to further understand potential business opportunities for trade and development.”

The biggest obstacles faced by the port are the cyclical nature of many of Darwin’s key trades that require capital intensive infrastructure.

“This creates challenges in trying to balance the risk associated with major investments against the possibility that the anticipated levels of demand may not occur. We try to manage these risks by working closely with our proponents to ensure their projects are as viable as possible, and also by trying to make sure that our infrastructure is flexible and able to be used for multiple trades and industries, where possible.”

Well-planned road-transport corridors and close proximity to the Adelaide to Darwin rail terminal provides ease of access to Darwin Port for users to or from all parts of Australia. The port has existing capacity and this, coupled with a port development strategy driven by a determination to take advantage of projected trade growth, sees it well positioned to be able to partner with operators from a wide variety of business sectors.

The completion of the Darwin Marine Supply Base at East Arm Wharf in 2014 cemented Darwin’s position as a major offshore supply hub. A proven track record of more than 20 years in providing facilities to service oil and gas fields to the north of Darwin was a key factor in the decisions by major operators in Browse Basin to locate their logistics bases close to Darwin Port.

Truckers battle weather and high costs

Road transport in the Top End is in a different environment than that of the southern states. Throughout Northern Australia, floods, fires and cyclones are going to wash out the roads every year, but it’s the way it is, says Warren Clark, CEO of the National Road Transport Association.

“You can’t determine how badly that’s going to destroy your roads. Your population is low, your distances are vast, your cost is massive,” he says of the challenges for road transport in the north.

“It’s just the job that transport does to try and get around that and keep in business and then it’s the job of the people at the other end trying to get that freight and actually survive.”

Mr Clark believes the difference is in the remoteness of the north.

“We estimate probably between 85 to 90% of the transport is by road,” he said.

“There’s a train that goes from Adelaide to Darwin every day, but still most of the freight is done by road.”

While Mr Clark says much of the freight on trains is bulk coal and mining related, they still carry a good deal of general freight.

And while television series Offroad Truckers might be entertaining Mr Clark said it’s not a real reflection of the industry.

“One thing that is reflective of it is the characters that are involved in the industry and that whole show is really built around those characters.

“There are some pretty large, pretty professional, pretty organised freight companies that are transporting freight through the territory, not these guys who are just doing that remote stuff.”

Freight at the Top End also travels vast distances.

“Most of your freight comes in from Adelaide because it’s just the cheapest way of doing it. A large portion of the freight comes in through Queensland, some in through Sydney, WA and that goes up your main highways,” Mr Clark said.

“But when you’re talking about going out to your remote areas, and the territory is full of remote areas, you’ve then got to get off those beautifully maintained roads and get on to some pretty average roads. And those roads … they’re pretty average. Most of them are gravel. They’re not maintained like the main highways are, and therefore the freight task becomes more challenging to deliver. And most of that’s on truck with a little bit on barges to remote areas on the coastline, but mostly by truck.”

A major obstacle for the industry is the weather, Mr Clark said.

“You know, each year you’ve got wet seasons and each year there’s something that’s flooded, and sometimes those roads can be out of action for quite some time. I suppose the biggest area of flooding is probably through Queensland and from Brisbane through into Tennant Creek. The roads are always flooded; it’s always holding up things, it’s always washing out roads. It could be for days, and they could be for weeks. Have a look at the bridge that washed out at Fitzroy Crossing; you’re talking about eight months.

“Each year people trying to deliver freight, people trying to do business, people trying to actually just survive, they’ve got weather events. It’s a major, major challenge just to get stuff through.”

This creates challenges in trying to balance the risk associated with major investments against the possibility that the anticipated levels of demand may not occur.

Peter Dummett, Darwin Port

And Mr Clark said there’s not much they can do about it.

“They try and future-proof the roads where they’re not flooded, but hey, we’ve got a wet season, and we’ve got heavy rain. It’s pretty impossible. You can’t determine how big your cyclone is going to be. You can’t determine where you’re going to get bushfires. You can’t determine how badly that’s going to destroy your roads.”

Mr Clark said major highways in the Northern Territory are quite well maintained, but other adjoining highways are still dirt. He believes infrastructure never has enough money spent on it and improving infrastructure needs to be planned and become a long-term goal.

Labour is also a challenge.

“Finding employees through this country is a major challenge, in particular for our industry,” Mr Clark said.

“In the Northern Territory it may be slightly better than elsewhere because it is so remote and people don’t get the choices of all different jobs. It’s hard work, but it’s a good lifestyle, they earn good money and therefore people come in and do the jobs. But our industry is crying out for, in particular, drivers. We’re at a bare minimum; we’re at about 26,000 short across the country, and the Northern Territory is not immune to that.

“I think probably the biggest thing to do with freight is still the absolute cost of doing business which is out of control. Fuel prices in the territory are always a challenge. But one of the big challenges in the [Northern] Territory at the moment is actually the cost of workers’ compensation.

“That’s just a black hole for employers. rising costs, poor management of workers’ comp, all that sort of thing. That’s something that’s coming out of the woodwork and it’s costing business a lot of money.”

Aurizon’s rail network does heavy lifting

The $1.4 billion Aurizon invested in mid-2022 to acquire the One Rail business (now called Aurizon Bulk Central) in the Northern Territory and South Australia recognises that rail is a vital part of decarbonisation of Australian supply chains by doing more of the heavy-lifting on key corridors.

A statement from Aurizon said the investment recognises the strategic value and potential of the business in serving rapidly-growing markets for resources, agribusiness, renewable energy and general freight.

Aurizon Bulk Central is an integrated rail operation with both track infrastructure and above-rail operations, with depots in Adelaide, Port Pirie, Port Augusta, Whyalla, Thevenard, Alice Springs, Tennant Creek, Katherine and Darwin. The business has more than 400 employees and has continued to recruit a range of new roles to support ongoing growth.

Aurizon is an Australian company listed on the ASX, with more than 150 years of rail experience. It is the nation’s largest rail freight business, with more than 700 locomotives, 15,000 wagons and more than 5000 employees across its national footprint. The business transports around 250 million tonnes for customers each year.

The 2244-kilometre Tarcoola to Darwin railway is a nationally significant corridor with direct connection to the port of Darwin.

Since 2022, Aurizon has invested more than $50 million in new assets to support growth for the region, including two mobile harbour cranes at Darwin Port. Aurizon has also established stevedoring services for its customers at Darwin Port.

Aurizon operates intermodal trains from Adelaide to Darwin and return, and various bulk ore trains for mines in South Australia and the Northern Territory. The Ghan passenger train operated by Journey Beyond also uses the corridor for its luxury rail experiences.

It is also assessing opportunities in Central Australia including developments for commodities such as magnetite, copper, rare earths and phosphate. In November 2024 Aurizon and Northern Iron began a new rail haulage contract for magnetite iron ore, from a mine near Tennant Creek through to the port of Darwin. Up to 1.2 million tonnes per annum of magnetite from the Warrego project will be railed 1000 kilometres between mine and port.

Aurizon is also exploring land-bridging of imported freight from Darwin Port via Aurizon’s rail infrastructure to southern markets. The statement said this is a natural extension of the national container services they are already providing customers, and where Aurizon will leverage that capability and installed rollingstock assets.

“Darwin can offer materially reduced transit times under the land-bridging proposal, with a saving of up to seven days of transit time on a typical Shanghai to Melbourne shipping route which is an attractive proposition for time-critical freight. It also offers customers a reliable alternative supply chain to markets, strengthening the resilience and consistency of existing supply chains,” the statement said.

You can’t determine how big your cyclone is going to be. You can’t determine where you’re going to get bushfires. You can’t determine how badly that’s going to destroy your roads.

Warren Clark, National Road Transport Association

According to Aurizon the Australian rail industry is well-positioned to contribute to the decarbonisation of Australian supply chains by doing more of the heavy-lifting on key corridors – using existing assets and also with the emerging technology of battery and hydrogen powered locomotives.

“Using rail for heavy freight is already the safest, most environmentally friendly mode of land freight transport with approximately 75% fewer greenhouse gas emissions generated by rail per tonne of freight compared to road. Rail also delivers improved road safety outcomes for the community because one train can carry up to equivalent of 150 standard semi-trailers.

“Aurizon has a dedicated $50-million Future Fleet Fund to drive short and long-term decarbonisation initiatives for its locomotive fleet. The aim is to deliver low or zero-carbon supply chains for our customers, with locomotives using renewable energy sources from the electricity grid and/or hydrogen fuel cells.”

Ports North not just for holidays

Heading east toward Queensland, the names of places that many Australians associate with holidays are the small ports operated by Queensland-government-owned Far North Queensland Ports Corporation, trading as Ports North.

These include the ports of Cairns, Cape Flattery, Karumba, Mourilyan, Skardon River, Quintell Beach, Thursday Island, Burketown and Cooktown.

They are a vital contributor to the economic well-being of northern Queensland, playing a significant role in tourism with extensive marina and tourism facilities, particularly in Cairns, as well as moving bulk shipments of sugar, molasses, silica sands, zinc, fuel, fertilisers, minerals, and general and project cargo.

It has a range of strategic land holdings including approximately 283 hectares of freehold and 635 hectares of leasehold strategic port land and properties across its ports.

Ports North is working to a 30-year, two-port master plan for Cairns and Mourilyan to build on the region’s economy.

The master plan was developed in consultation with local stakeholder groups over an 18-month period and has helped with the development of the Cairns Marine Precinct and HMAS Cairns as well as growth in tourism, project cargo and coastal freight.

The plan also identifies opportunities for growth in sugar and molasses, along with opportunities for additional magnetite, silica sands and fuel at the Port of Mourilyan.

This article appeared in the December 2024 | January 2025 edition of DCN Magazine