Riding Australia’s big dipper
From Griffith REVIEW Edition 12: Hot Air
© Copyright Griffith University & the author.
Written by Geoffrey Blainey
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Geoffrey Blainey's biography and other articles by this writer
Australia's history during the past 150 years has often revolved around fossil fuels. They have affected not only daily life but the rise and fall of Australian states. They have shaped turning points in local politics and international relations. Thus, the outbreak of war between Australia and Japan in December 1941 was influenced by fossil fuel; so, too, was that major landmark in politics, the election victory of R.G. Menzies in 1949 – the start of the longest reign in federal politics.
In the early British history of Australia, firewood was the important fuel. The timber cutter was more important than the coalminer. By the 1850s, with Australia entering the age of steam, coal became vital. Gasworks were built in Sydney and Melbourne, foundries and factories appeared here and there; and all these ventures burned lots of coal. The first short-distance railways were built in Sydney and Melbourne in the 1850s and they preferred coal to firewood. At the same time, a few steamships, competing with fleets of sailing ships, plied the long route between England and Australia, and they burned so much coal in each twenty-four hours that they were in danger of running out of it in mid-ocean. Therefore, they combined sail power and coal power on the long stretches between coaling ports. When the winds blew strongly the steam engines were idle.
The mines of the Hunter Valley, along with the coalmines south of Sydney, increasingly exported coal. By the 1890s, many sailing ships waited daily at the mouth of the Hunter to load the coal – it was ideal for producing steam, and carried it to ports in countries as far away as Chile, Peru, China and the Philippines. Those cheap old workhorses, the sailing ships, usually carried the coal, for they charged low rates. In contrast, the multiplying number of steamships burned much of the coal. It was a strange but valuable marriage, wind and fossil fuels. The marriage so important to Newcastle virtually ended around 1914 with the coming of the First World War and the fast decline of the globe's fleet of sailing ships.
In 1900, coal was not one of the country's top export industries: it was dwarfed by wool and gold. That a century hence, coal would be the leading Australian export was inconceivable. But coal was already vital for NSW. After the discovery of gold in 1851, Victoria had caught up to NSW in population and swept far ahead; but the fact that coastal NSW held, so far as was then known, the great black coal resources of the continent proved to be a terrible long-term blow to Victoria. NSW overtook Victoria in population in the early 1890s; Sydney overtook Melbourne a decade later. Part of the promise and strength of NSW was that, in an era when black coal was becoming vital, it was the dominant source.
When one of the crucial economic decisions so far facing Australia had to be made where should the ironworks and steelworks and all the allied industries be established ? there was only one answer: in NSW, for it held the beds of high-grade black coal. By 1914 the first steelworks were busy at Lithgow, alongside a coalfield on the inland side of the Blue Mountains. A year later, far more important steelworks were opened in Newcastle by BHP, then primarily a silver-lead miner at Broken Hill. The new works poured out their clouds of steam and smoke alongside the river at Newcastle and steadily gave rise to a network of industries that used iron and steel, and coal, too, as their raw materials. Nothing did more to make NSW, and not Victoria, the centre of manufacturing in the twentieth century than the possession of fine seams of black coal.
At the time of its birth in 1901 the Commonwealth was almost entirely self-sufficient in fuels. It mined all its own coal and even exported some. It cut its own firewood, which was a vital fuel for cooking, heating and generating steam; the steam boilers of the great Kalgoorlie goldfield depended overwhelmingly on firewood cut in the district by an army of woodsmen and delivered by little railways. Australia also produced its own hay, oats, chaff and grass for the horse teams so vital on the farmlands and for carting goods in the cities. And the wind itself gave power to the deep-sea windjammers and other ships that survived by carrying away to Europe the exports of timber, coal and wheat from a wide circle of ports stretching from Bunbury to Newcastle.
But this charmed era of self-sufficiency was broken by the internal-combustion engine and its craving for petrol. With its distances and sparse population, Australia was especially suited to motor vehicles. By 1930, Australia with barely six million people was one of the most motorised nations in the world. It owned more vehicles than populous, motor-loving Italy. The petrol pump, worked by hand, was almost a national symbol. There was only one hitch. Australia itself produced no oil.
Ironically, Australians and New Zealanders, whose lands were then totally deficient in oilfields, were already prominent in discovering oil-fields elsewhere. William K. D'Arcy, a solicitor in Rockhampton, made his fortune from the gold of Mount Morgan – the first Australian public company (the share-market darling) to pay one million pounds in dividends in the space of a year. He used part of this fortune to finance a search for oil in Iran. This led to the discovery of the first oil in the Middle East in 1908, one of the most momentous events of the twentieth century. Later, a New Zealander, Major Frank Holmes, played a vital part in finding the first oil in the Arabian Peninsula in the 1930s. In contrast, for decades, the search for oil on Australian soil was neither strenuous nor successful.
The fifty years 1901-51, with their growing emphasis on oil, transformed Australia from self-sufficiency in fuels to vulnerable dependency. As the motor car and then the tractor penetrated everywhere, as aircraft became common, as deep-sea ships began to burn oil and then diesel fuel, and as many locomotives eventually turned to the same fuels, Australia became a huge importer of oil and petroleum. The nation's balance of payments, and at times its financial solvency, suffered as a result. Fossil fuels became our biggest import.
In the Second World War, with oil so essential, Australia's whole economy was vulnerable. Its whole way of life and work depended heavily on the oil tankers that plied the long sea routes from the Persian Gulf and other oil regions. Australia was forced to ration petrol in 1940.
Japan was just as reliant on imported oil. The extension of the fighting to the Pacific and South-East Asia was strongly influenced by Japan's quest for oil. A heavy importer of oil, it was largely deprived of that oil by economic and financial sanctions imposed in 1941 a few months before Pearl Harbor by the United States, Britain and Australia, too. Japan's answer to the embargo on its oil imports was to launch its astonishing military attack, which in the space of less than three months captured the great oilfields of Dutch Indonesia and British Burma.
More than four years after the war was over, Canberra continued to ration petrol. No Australian motorist, no carrier, no farmer, no taxi driver could buy petrol without also handing over, at the service station, a petrol coupon. If you were lucky enough to buy one of the very first Holden cars in November 1948 you still had the task of scavenging, somehow, enough petrol to drive away for a long holiday.
Queenslanders led the fight against petrol rationing and in July 1949 a Brisbane garage-owner took his case to the High Court. A Queensland politician, Sir Arthur Fadden, leader of the federal Country Party (now the Nationals), initiated the public campaign to terminate petrol rationing. He was swimming on the Gold Coast in 1949 when he was confronted by the head of an Australian-owned oil importer, Ampol, who demanded to know why Ampol could buy petrol from Poland and France, but was not allowed by the federal government to import it. Fadden took up the case and it was a vital topic in the federal election of 1949. He became the treasurer in the new Menzies government, which abolished petrol rationing on February 8, 1950.
AUSTRALIA WAS STILL A LARGE PRODUCER OF COAL. But the coalmines became less efficient, less reliable. Back in 1910, Newcastle had been such a cheap producer that it sent a procession of sailing ships loaded with coal to other lands; but, in the next thirty years, the coalmines lost their export markets. Industrial relations on the coalfields deteriorated. During the Second World War, when the nation relied heavily on coal for making iron and steel and munitions, as well as for domestic purposes, the war effort was disrupted by coal disputes. Of the millions of working days lost through industrial upheavals during the war, fifty-three per cent of the lost days were in the coalmines. When France was about to fall and Hitler seemed likely to invade Britain, the coalminers of NSW were engrossed in a long strike.
Nearly every Sydney and Melbourne housewife at that time knew the names of the NSW coalmines because they were always in the news: the coal-miners were often on strike or locked out. In the late 1940s, Melbourne and Sydney periodically suffered from a shortage of gas and electricity for cooking, heating and transport. In 1949, Ben Chifley, a Labor prime minister, had to send Australian troops to the NSW coalfields in the hope of producing urgently needed coal.
Victoria, especially, suffered because it lacked its own cheap energy. Much of its coal was imported from NSW. That coal had to run the gauntlet. Strikes were frequent not only in the NSW coalfields but at the waterside where the coal was loaded and in the little colliers that carried the coal to Melbourne.
Victoria's solution was to develop its own massive low-grade coal deposits. Close to the surface in the La Trobe Valley, the deposits of brown coal required an enormous injection of capital. By 1960, a large part of Victoria's electricity was coming from state-owned brown coal. Similarly, much of the gas used in Melbourne whether in houses or factories, came from the new Lurgi process by which brown coal was converted to gas and piped to Melbourne. It was a sign of the zeal with which Victoria harnessed a second-rate resource that two of the nation's major aluminium smelters – the manufacture of aluminium is a huge consumer of electricity – were built on the coast of Victoria, one near Geelong in the 1960s and the other at Portland in the 1980s. If the mining of black coal in NSW had been efficient, and interstate transport had been, too, Victoria might never have developed an aluminium industry.
The great Snowy Mountains scheme was, in part, another attempt to escape from the chaotic condition of NSW coalmining. The plan was that hydro-electricity, which was less vulnerable to poor industrial relations, would supplement power generated from black coal. The water, having passed through the power stations, would also irrigate inland plains.
The Snowy scheme caught the nation's imagination and still does. Bold in its conception, it was the first post-war haven for a multi-ethnic workforce. As it was financed and controlled by the major governments and was also conspicuously close to Canberra, it gained maximum political publicity during the quarter century (1949-74) in which it was constructed. Tasmania was also bold in turning to hydro-electricity. By the end of the First World War, it operated a government station at Waddamana and a private one at Mt Lyell. Tasmania's great era of dam building was to come after the Second World War, but it did not catch the nation's imagination.