Skip to main content

Adanis' decision to self-fund Aussie project is "no guarantee" the mine will go ahead

By Samantha Hepburn*
Indian mining multinational Adani has announced that it will self-fund a significantly smaller coal mine in the Galilee Basin, after failing to secure finance from more than 30 domestic and international banks and lenders. Federal Resources Minister Matt Canavan has described Adani as a “little Aussie battler” and praised the newly scaled-down project’s purported regional economic benefits.
The scaling down of the project has been extensive. Adani Mining chief executive Lucas Dow said the mine will cost A$2 billion and initially produce up to 15 million tonnes of thermal coal per year, with plans to ramp production up to 27.5 million tonnes per year.
That is far more modest than the A$16.5 billion investment in digging up 60 million tonnes of coal a year which the company first announced in 2010. The original plan was to transport the coal along a new 388km rail line to a specially built terminal at Adani’s Abbot Point coal port, for export to India. Under the scaled-down version of the project, Adani will need to secure access to existing rail infrastructure.
But there is still no guarantee that the mine will necessarily go ahead. Opening a new coal mine – even one with a relatively modest A$2 billion price tag – is socially and environmentally irresponsible, given the urgency with which the Intergovernmental Panel on Climate Change says we need to reduce global greenhouse emissions, the fact that Australia is not currently on track to meet its own emissions targets, and of course the fact that 2018 is on course to become the fourth-hottest year on record.
The economics barely stack up either. A recent IEEFA report indicated that coal is facing a terminal decline as Asian markets make the transition to cheaper and more efficient renewable alternatives. Existing thermal coal power in India costs US$60-80 per megawatt-hour, roughly double the cost of new renewable generation. The Mundra coal plant, where much of the Adani coal was destined, is already operating under capacity and has been closed for significant periods.
Adani has decided not to proceed with its initially planned 388km rail link, and will instead aim to use the existing Aurizon rail infrastructure. However, there is a 200km gap in this link which will cost a significant amount to bridge – albeit almost certainly much less than the A$2.3 billion cost of the originally planned railway. Aurizon Network is legally obliged to consider Adani’s access application, but has not yet assessed and approved it.

Environmental and Indigenous issues

Then there are the existing and significant concerns regarding Adani’s environmental management of issues such as water contamination in the Caley Valley Wetlands near the Abbot Point terminal. These will not disappear just because the project has been revised.
Gaining the consent of Traditional Owners will also be crucial, yet the 12-member native title representation group is split down the middle. Adani’s existing Indigenous Land Use Agreement has been appealed in the High Court by the Wangan and Jagalingou people, on the basis that the group has not genuinely consented to the agreement, and that overriding native title to make way for a coalmine is socially and culturally regressive. 
If the court does not uphold the agreement, this would create profound difficulties for the project as they may not be able to proceed with the development of the coal mine to the extent that it interferes with Indigenous landholdings.
So, while the decision of Adani to self-fund a scaled-down coalmine in Queensland might indicate determination, it also suggests a resistance to, and misunderstanding of, a rapidly changing energy sector and the broader social and environmental responsibilities that this change necessitates.
---
*Director of the Centre for Energy and Natural Resources Law, Deakin Law School, Deakin University, Australia. This article first appeared in The Conversation

Comments

TRENDING

US research: 40% of India's casteist Facebook posts are anti-reservation, anti-Dalit

By Rajiv Shah
A recent American civil society research has found that 40% of India's casteist posts on Facebook (FB) have anti-reservation slant. Asserting that the reservation policy in India is similar to affirmative action in the United States, the research study, titled "Facebook India: Towards The Tipping Point of Violence Caste and Religious Hate Speech", says, this type of hate content on FB is mainly directed against Dalits and Adivasis.

Sanjiv Bhatt paying price for deposing on Modi role in Gujarat riots: Wife Shweta

Counterview Desk
Following the Jamnagar sessions court ordering life imprisonment to former IPS officer Sanjiv Bhatt for his alleged involvement in three decades old custodial death case, his wife Shweta Bhatt has said that he has been sentenced for a “for a crime he did not commit”, even as criticizing the Indian Police Service (IPS) Association, Gujarat, for not standing up for him.

Senior advocates targeted because they took up cases against Amit Shah: Lawyers' NGO

Counterview Desk
The Lawyers Collective (LC), an NGO claiming to promote human rights issues, has expressed surprise at the latest move by the Central Bureau of Investigation (CBI) to register an FIR against the Lawyers Collective (LC), its president Anand Grover and unknown office bearers for alleged violation of the Foreign Contributions Regulation Act (FCRA).

How Gujarat govt imposed curbs on livestock export for 'fear' of losing BJP vote share

By RK Misra*
Insidious are the ways authorities function, preaching one thing, practicing quite another. Administrative muscle-flexing to suit political goals was on display when the BJP-led Vijay Rupani government in Gujarat banned the export of livestock days ahead of Eid. Even the Narendra Modi-led government expressed its intent to confirm it countrywide, but stopped short of doing so.

One of the least peaceful countries, India's global peace ranking deteriorates: Report

By Rajiv Shah
A just-released report has asserted that India's ranking in the Global Peace Index (GPI) is 141st among 163 countries, deteriorating by four ranks in a year. Ranking 163 countries by providing a score to each, the report, prepared by the Institute for Economics and Peace (IEP), headquartered in Sydney, Australia, has found India to be one of the least peaceful nations in the region.

Demand for Bharat Ratna to Dalai Lama as top RSS leader warns China of 'strong' action

Nava Thakuria*
Dharamshala: Indian supporters for a free Tibet have urged the Government of India to confer Bharat Ratna, the country’s highest civilian honour, on the Tibetan spiritual leader, the 14th Dalai Lama, for his “immense contributions” in creating goodwill for India in the last six decades. A declaration, adopted at the 6th All-India Tibet Support Groups’ Conference held on June 15 and 16 in Dharamshala township of Himachal Pradesh, said that the Nobel laureate continues to be a holy ambassador of Indian culture enriched with non-violence, compassion and religious harmony.

Sabarmati 'cleaned up' swimming pool style: Untreated effluents discharged in river

Counterview Desk
In a fresh letter to the secretary, Ministry of Environment, Forests and Climate Change (MoEFCC), Government of India, senior Gujarat environmentalists Rohit Prajapati and Krishnakant of the Paryavaran Suraksha Samiti (PSS) have taken strong objection to the recent clean-up drive of the about 11.3 km stretch of Sabarmati riverbed undertaken by the Ahmedabad Municipal Corporation (AMC), terming it as “swimming pool type clean-up.” The river’s total length is 371 km.

Jharkhand mob lynching: Adivasis protest police 'inaction', FIR against victims

Counterview Desk
The Jharkhand Janadhikar Manch (JJM), a civil rights network, on Monday sponsored a protest against the police action against the Adivasi victims of the lynching which took on April 10, 2019, in Jurmu village of Dumri block in Gumla district of Jharkhand. The incident led the death of Prakash Lakda, aged 50.

Gujarat govt 'considers' temples, charitable institutions as shops and establishment

By Pankti Jog*
The Gujarat state assembly recently passed a new law which would "govern" the working condition of shops and establishments. One of the most talked about provisions of the Act is, it allow shops and establishments across Gujarat to function 24 hours.

There is no 'separate' Kashmir story, as there is for Afghanistan, Nepal, Tibet, Palestine

By Mohan Guruswamy*
Kashmir is the northernmost geographical region of South Asia. Until the mid-19th century, the term "Kashmir" denoted only the valley between the Great Himalayas and the Pir Panjal mountain range. The name Kashmir derives from the Sanskrit Kashyapmeru. The Greeks knew it as Kaspeiria. Herodotus called it Kaspatyros.