Adani Enterprises says it will proceed with its $16.5 billion Carmichael mine and rail projects in Central Queensland, Australia

Gautam Adani says the project would create 10,000 direct and indirect jobs, with pre-construction works starting in the next few months.
Gautam Adani says the project would create 10,000 direct and indirect jobs, with pre-construction works starting in the next few months.

Ahmedabad: Adani Enterprises Ltd (AEL), a part of the Adani group, on Tuesday said it will proceed with its $16.5 billion Carmichael mine and rail projects in Central Queensland, Australia, after the company’s board approved a final investment decision on the development.

“I am proud to announce the official start of one of the largest single infrastructure and job creating developments in Australia’s recent history,” Gautam Adani, chairman of Adani group, said in a statement on Tuesday, calling it a historic day for Queensland and for Indian investment in Australia.

Adani’s announcement comes soon after it reached an agreement with Queensland government last week on royalty payments for the coal mine project. The AEL board had earlier deferred a final decision on investment plans pending the royalty agreement.

“We have been challenged by activists in the courts, in inner city streets, and even outside banks that have not even been approached to finance the project,” chairman Adani said in a stock exchange filing in India where AEL is listed.

“We are still facing activists. But we are committed to this project,” he added.

The company said that it has signed contracts for design, construction, operations, supply of materials and professional services. This includes a $2.6 billion contract to Downer Mining for the construction and operation of the Carmichael mine.

The company has also announced in the past few weeks contracts totalling more than $150 million for railway tracks and concrete sleepers for the planned 388-km standard gauge rail link between the mine and Abbot Point port terminal project.

Queensland Premier, Annastacia Palaszczuk, on Tuesday officially opened Adani’s Regional Headquarters (RHQ) in Townsville from where the company will oversee the construction and operations of the project.

Adani, which has already invested $3.3 billion in the project, including buying the bulk coal handling port at Abbot Point, has run into resistance from environmentalists who claimed that the coal project would increase carbon pollution and cause irreparable damage to the Great Barrier Reef marine park in northern Queensland.

Environmental finance campaigning group Market Forces said it has dismissed Adani’s “final investment decision” on its proposed Carmichael coal mine not only as a PR stunt, but one that could wind up forcing the Australian and Indian public to shoulder major risks.

“The Carmichael mine is an economic disaster but the fact that it would pose significant risks to the environment, air pollution, and our chances of avoiding runaway climate change means that investors have also seen this project as laden with reputational risk,” said Julien Vincent, executive director of Market Forces in the statement.

The Carmichael project is expected to generate 10,000 direct and indirect jobs, with pre-construction works starting in the September quarter of 2017. The group expects to mine 25 million tonnes per annum in the first phase by 2020-2021.

Last year, the Queensland department of environment and heritage protection issued the final clearance for the project in the Galilee Basin. On 19 August, Adani won a major legal battle when the Australian apex court dismissed appeals lodged by indigenous community member Adrian Burragubba as well as a Brisbane-based environmental group against the project.

In a press statement on Tuesday, Burragubba said that the battle with Adani group for the mine project would continue. “Adani can put on whatever song and dance they like but the reality is that we have never consented to Adani’s mine being constructed on our land,” he said.

Last month, AEL thanked Australian Prime Minister Malcolm Turnbull and opposition leader Bill Shorten for their support for the changes to the Native Title Bill. The amendment bill, which is expected to be passed in the Australian parliament next month, makes it easier for companies like Adani to sign land rights agreements with indigenous land owners.

Adani group’s Australia head of country and chief executive Jeyakumar Janakaraj on Tuesday announced a further contract for the Carmichael Rail Network linking Galilee Basin mines including their mine to the port of Abbot Point.

“But we are building more than a rail line. We are building a line that will open the Galilee Basin, linking that massive coal reserve to markets around the world, generating power, and—importantly—generating many thousands of direct and indirect jobs in regional Queensland,” Janakaraj said.

In Adani’s case, he said, it will link its Carmichael coal mine to their bulk loading facility at the port of Abbot Point from where it will be shipped to Adani’s power stations in India.

“To those activists who sit and criticize us, I ask a simple question—what are you doing for these people,” Janakaraj said, while emphasizing that Adani was delivering on its promise to address poverty for millions in India and unacceptably high unemployment in regional Queensland.


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