Brisbane port and QR part of asset sell-off

Though Ms Bligh had flagged major divestments in the up-coming State Budget after the state lost its AAA credit rating, the scale of the proposed $16bn sell-off over five years was still surprising.

Market sentiment for Asciano and Babcock & Brown Infrastructure, two companies looking to sell Queensland coal-rail and port facilities respectively, appeared unaffected, with their share prices following the market upwards yesterday and remaining relatively steady today.

QR will bear the brunt of a plan which will also see Queensland Motorways Limited and Forest Plantations Queensland sold off.

"Options for the sale of QR's bulk freight, intermodal, retail and regional freight services will also be investigated and offered to the market in the most appropriate way," Ms Bligh said in presenting her Renewing Queensland Plan.

"Further, we will negotiate with the Federal Government for the sale or lease of QR's regional below-track network to the Australian Rail Track Corporation which is owned by the government."

The state will retain QR's passenger component.

The divestment is expected to reap $7bn as well as avoiding the same amount in capital expenditure.

It would be up to the private sector to build the "missing northern link".

"Our revitalised and reorganised coal freight system will have the capacity to move more coal to the world providing a greater return in royalties to Queensland," Ms Bligh said.

"For example, an integrated sale could offer the Goonyella through Newlands to Abbot Point system along with the sale of Abbot Point Coal Terminal."

She was less forthcoming about the Port of Brisbane sale, saying only that private ownership would secure its long-term development and that the port of Bundaberg would be transferred to the Port of Gladstone Corporation.

In renewing his call for consultation with the resources sector over Abbot Point, Queensland Resources Council chief executive Michael Roche reiterated that the state could reduce financial pressures from debt funding of infrastructure by reducing its traditional role in areas underwritten by industry commitments such as take or pay contracts – a common tool in financing the construction of export infrastructure such as rail and port facilities.

"The [State] Government’s preferred model is already on display with the grant of development rights to a coal industry consortium for the planned Wiggins Island Coal Terminal near Gladstone,"Mr Roche said.

"By further questioning government-owned corporations’ investments in large scale infrastructure projects and the provision of services that the private sector could deliver equally well or more efficiently, the government could move to lead in areas of genuine market failure in the provision of key infrastructure which continue to restrain the growth of Queensland."

Ms Bligh confirmed that the fuel subsidy would end, attracting the ire of the Queensland Trucking Association (QTA).

Absorbing the extra nine cents a litre cost would "lead to further job losses and the downsizing of freight operations", QTA chief executive Peter Garske said.