Since August 2003, there has been evidence that the Hunter Valley coal export infrastructure has been stretched and that some coal export growth might have been lost as a result of constraints in the system. In response to this situation, Port Waratah Coal Services (manager of the Kooragang coal terminal located on Kooragang Island and Carrington coal terminals at the Newcastle Port) applied to the Australian Competition and Consumer Commission to implement a short term capacity distribution system to allocate the current capacity of the coal supply chain to existing coal exporters. This scheme was implemented in June 2004 and interim authorisation to continue a modified version of the scheme until December 2007 – called the medium term capacity distribution system – has been granted by