BUSINESS

Adani's Controversial $16.5 Billion Carmichael Mine Set To Go Ahead

06/06/2017 7:05 AM IST | Updated 06/06/2017 10:16 AM IST
Amit Dave / Reuters

And now, the real fight begins.

Environmentalists, financiers, economists and indigenous groups have all voiced their protest after it was formally announced on Tuesday that Indian resources giant Adani's controversial Carmichael mine in the Galilee Basin in Queensland would go ahead.

Concerns include:

  • wildly inaccurate job projections
  • a looming native title battle
  • problems with finding a bank to fund the project
  • the enormous cost to taxpayers
  • potential damage to the Reef, both directly (via shipping) and indirectly (via the effects of climate change)

Queensland Premier Annastacia Palaszczuk was in Townsville when she announced that Adani chairman Gautam Adani had green-lighted the largest ever Indian investment in Australia.

The regional city of 190,000 has an unemployment level of more than 11 percent, and Adani's local headquarters will be located there. Palaszczuk said between 10,000 and 15,000 jobs would be created [in the construction and operational phase of the rail and coal mining project].

The Premier quoted this figure despite a widely publicised 2015 submission to the Queensland Land Court which said that just 1,464 jobs would be created.

Land Court of Queensland

"This is a great day not just for the Queensland economy but for the Queensland people, and our greatest asset is our people," Palaszczuk said.

Resources Minister Matt Canavan said it was the first new coal basin opened in Australia in 50 years, and failed to mention the phrase "climate change" in a long-winded speech. He also invoked the "energy poverty argument" -- namely that Adani's Carmichael coal will help drag 250 million Indians out of poverty -- despite that argument having been widely discredited.

Environmental groups are strongly opposed to the development.

"This is a PR stunt for a toxic project which wont be able to go ahead without a huge handout of public money," Greenpeace Climate and Energy Campaigner, Nikola Casule said, referring to the almost $1 billion federal government loan to construct the rail line to Abbot Point coal terminal.

"It is a shocking betrayal of ordinary Australians who want their money invested in schools and hospitals and not gifted to a billionaire coal mining company.

"This toxic mega-mine is deeply unpopular with the Australian people and is not viable without massive handouts of public money through subsidies or loans from the NAIF and Queensland government.

"Any public assistance to the mine is a betrayal of the Australian public and the things they hold dear, like a healthy Reef and support for public services that lose out when billions of dollars are given to Adani instead of to schools and hospitals."

In May The Climate Council said it would create a disaster for the Great Barrier Reef, people's health, and for the warming climate, while creating a net loss of jobs overall due to opportunities foregone in the renewables sector.

Construction is set to start in September, yet despite Tuesday's announcement, the mine is not certain to be built. The Stop Adani Alliance, a group made up of 20 key environment groups, called Tuesday's announcement "Groundhog Day".

"Adani has announced an 'investment decision' multiple times over the six years since it acquired this project proposal, but it's still floundering around trying to secure the finance it needs to obtain 'financial close'," Alliance spokesperson, prominent businessman and ACF President Geoff Cousins said.

"Adani is yet to lure any financial institutions willing to bankroll the project, which is proving hugely unpopular with the Australian public.

"If the Federal government hands Adani $1 billion of public money for this destructive mine that will destroy our Reef, we will consider all avenues, including legal action, to stop it."

Julien Vincent, Executive Director of environmental finance group, Market Forces, also said it would be an uphill slog for Adani to secure finance for what he called an "unviable project".

"Twenty-three banks have either distanced themselves publicly from Galilee Basin coal export projects, or introduced policies that prohibit financing Adani's mine," he said.

"Global shifts towards clean energy and India's move away from coal makes Adani's project a dud prospect. No wonder no one will touch it."

There is also a looming legal battle with the local indigenous community. Both the Abbot Point coal port and the Galilee Basin sit on land which is under native title.

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