MAC: Mines and Communities

Adani Carmichael: Australia's largest coal mine free to proceed after Greg Hunt gives approval

Published by MAC on 2015-10-18
Source: Sydney Morning Herald, statement,

Australian Evironment Minister Greg Hunt announced their approval on 15th October of the Carmichael coal mine, proposed by Indian mining company Adani.

This decision has been taken despite Adani having yet to raise upwards of $16 billion, and - given that the project is aimed at exporting the majority of mined coal - a clear consideration of its downstream impacts.

The Australian Conservation Foundation has called the Ministerial approval ‘grossly irresponsible.

Previous article on MAC: Double blow for Adani's Carmichael mine in Australia

Adani Carmichael: Australia's largest coal mine free to proceed after Greg Hunt gives approval

Nicole Hasham

Sydney Morning Herald

15 October 2015

The nation's largest coal mine is free to proceed after Environment Minister Greg Hunt approved it with "the strictest conditions in Australian history", in a decision environment groups have declared "a disaster".

Mr Hunt on Thursday said the Carmichael coal mine proposed by Indian mining giant Adani has been given the green light after the Federal Court in August set aside the previous approval.

The project, which will produce up to 60 million tonnes of coal for export a year, has faced staunch opposition because its Abbot Point terminals are located close to the Great Barrier Reef.

Opponents have already flagged an intention to launch a legal challenge to the latest approval.

The government decision clears a regulatory hurdle, yet there are still questions over how the $16 billion project will be financed. National Australia Bank has said it will not fund the mine and other banks are being pressured to follow suit.

The court previously said Mr Hunt had not properly considered advice about two threatened species – the yakka skink and the ornamental snake.

Mr Hunt on Thursday said his approval for the project, in the Galilee Basin in remote central Queensland, considered additional information provided by Adani and environmental groups.

The approval, which includes a rail line, would be "subject to 36 of the strictest conditions in Australian history".

These include implementing all advice from an independent expert scientific committee and protecting and improving 31,000 hectares of southern black throated finch habitat.

The approval will require $1 million funding for research programs to improve conservation of threatened species over 10 years, and strict groundwater monitoring and action triggers would protect Doongmabulla Springs, Mr Hunt said.

Mr Hunt has the power to suspend or revoke the approval and penalties will apply if conditions are breached.

The Department of the Environment will monitor the mine and Adani must provide a groundwater management and monitoring plan.

The Mackay Conservation Group launched its Federal Court challenge in January, alleging greenhouse gas emissions from the mine, vulnerable species and Adani's environmental track record had not been taken into account.

Mr Hunt said the court set aside the mine's earlier approval at the request of the government.

Mackay Conservation Group coordinator Ellen Roberts said the approval "risks threatened species, precious ground water, the global climate and taxpayers' money".

"[Mr] Hunt is sacrificing threatened species ... and precious ground water resources for the sake of a mine that simply does not stack up economically," Ms Roberts said, adding the black throated finch would probably be pushed to extinction.

She said the conditions set by Mr Hunt did not adequately deal with the serious implications of the mine, which "can't be offset".

Greenpeace Australia Pacific campaigner Shani Tager said the mine would be "a complete disaster for the climate and the Great Barrier Reef".

"This project means more dredging in the Great Barrier Reef, more ships through its waters and more carbon emissions," she said.

Adani welcomed the decision, saying the initial legal hurdle was a "technicality" prompted by a mistake by the Department of the Environment.

In a statement, the company said it was always "confident in the soundness of the broader approvals, that the species involved had been protected by conditions, and that the technical error would be promptly rectified".

"Today's announcement ... makes clear that these concerns have been addressed, reflected in rigorous and painstaking conditions," it said.

The company intended to deliver mine, rail and port projects in Queensland creating 10,000 direct and indirect jobs, and $22 billion in taxes and royalties to be reinvested into community services, Adani said. The jobs figure has been disputed.

Lobby group GetUp! on Thursday said its members had already helped fund legal action against the mine, and the organisation was "exploring the legal opportunities available to us" in light of the latest decision.

"This coal mine is the dumbest, most dangerous and uneconomic development in Australia," senior campaigner Sam Regester said.

"We are calling on GetUp! members and the community to stand up and fight this mine again. We've beaten it before and we can beat it again."

Govt reapproves Adani coal mine

Dow Jones newswires

15 October 2015

The [Australian] federal government reapproved Adani Group's plans for a major coal mine and rail line in eastern Australia, injecting momentum into a multibillion-dollar project that had snagged on environmental concerns and the global commodity price slump.

Environment Minister Greg Hunt attached 36 conditions to his approval of Adani's Carmichael coal mine and associated infrastructure in the Galilee Basin of eastern Queensland.

Adani aims to produce as much as 60 million tonnes of thermal coal annually for export to its power plants in India. Previous estimates have pegged the construction costs at $16.5 billion ($US12.1bn).

Mr Hunt also approved Adani's plans to build a rail line connecting the Carmichael mine with existing ports, which face the Great Barrier Reef.

It comes more than two months after a federal court in Sydney overturned the minister's earlier approval for Adani to build the Carmichael coal mine. Environmental activists had raised concerns about the project's impact on the yakka skink -- a native Australian lizard -- and another vulnerable species, the ornamental snake.

Adani and Mr Hunt had blamed the August 5 court ruling on red tape. Mr Hunt approved the mining project last year, but it was overturned because of what the environment department termed a "technical, administrative" issue. It said its advice to Mr Hunt during the approval process may not have been provided in the correct manner.

On Thursday, Mr Hunt said several conditions attached to the latest approval were designed to protect the ornamental snake and yakka skink. Measures include limiting disturbance to identified tracks and the rehabilitation of impacted areas. Also, at least 135 hectares of ornamental snake habitat and at least 5,600 hectares of yakka skink habitat must be protected and managed by Adani.

However, Adani still needs to arrange financing for construction of the mine while thermal-coal prices remain at multi-year lows, putting the viability of the project in doubt.

Environmentalists have campaigned for global lenders such as Morgan Stanley and Deutsche Bank to rule out any financial support for Adani's proposed expansion of the Abbot Point coal port, seeking to undermine the Indian company's plans.

Australia says ‘yes’ to Carmichael coal mine by Great Barrier Reef

Cecilia Jamasmie

15 October 2015

Adani's Carmichael project has been the focus of opposition by organizations ranging from the United Nations to green groups fighting new coal projects in the environmentally sensitive area.

Australia approved Thursday one of the world’s largest coal projects, backed by Adani Group, an Indian conglomerate with interests spanning mining, energy and logistics, dismissing the United Nations and scientists concerns over potential damaging effects to the nearby Great Barrier Reef.

The $12bn (A$16.5bn) Carmichael Coal Mine and Rail Project, in the untapped Galilee Basin, was temporarily blocked this Summer, but environment minister Greg Hunt said today work can continue subject to what he called “the strictest conditions in Australian history."

First proposed in 2010, the Carmichael project will mine up and transport about 60 million tonnes of coal a year for export, mostly to India.

Critics call the approval of the mine, which will cover an area seven times the size of Sydney Harbour, a "grossly irresponsible" decision.

Minister Hunt said the 36 conditions he had imposed upon the Carmichael mine and its rail infrastructure project took into account "issues raised by the community and ensure that the proponent (Adani) must meet the highest environmental standards".

The requirements include the compulsory implementation of all advice provided by an independent scientific committee. Adani will also have to protect and improve 31,000 hectares of southern black throated finch habitat, and will have to permanently monitor groundwater at a nearby wetland.

Long-dragged battle

Coal port projects and expansions have been a source of controversy in recent years, with academics and environmental groups raising the issue of “irreparable damage” to the country’s Great Barrier Reef Marine Park.

In 2012 UNESCO, the UN educational, scientific and cultural arm, sent an inspection team to the area, finding “a continuing decline in the quality of some parts” of the reef. However, the Queensland Resources Council was quick to snub the report.

Two years ago, more than 150 marine scientists from 33 institutions signed a letter warning Australian authorities of the mounting threats new coal ports and other industrial projects pose to the reef’s habitat.

Even Deutsche Bank refused last year to fund Adani’s plans to expand the port after the UN raised fresh on the world’s heritage site.

Some 100 million tonnes of coal will pass along the railway every year.

Local indigenous landowners, who are battling Adani in Australia’s Federal Court, also slammed the mine approval and described the state and federal governments' actions as "economically and environmentally irresponsible and morally bankrupt".

Adani coal mine approval ‘grossly irresponsible’

Australian Conservation Foundation statement

15 October 2015

Federal environment minister Greg Hunt’s approval of what could become one of the world’s largest coal mines sets back global efforts to combat climate change, the Australian Conservation Foundation said today.

“To approve a massive coal mine that would make species extinct, deplete 297 billion litres of precious groundwater and produce 128.4 million tonnes of CO2 a year is grossly irresponsible,” said ACF President Geoff Cousins.

“At a time when the world is desperately seeking cleaner energy options this huge new coal mine will make the effort to combat climate change all the more difficult.”

If it goes ahead the Carmichael mine would be the largest ever dug in Australia. It would take up five times the area of Sydney Harbour. The climate pollution resulting from burning its coal would be more than New Zealand’s entire annual emissions.

In August the Federal Court set aside Minister Hunt’s original approval of Adani’s controversial proposal to dig the massive coal mine in Queensland’s Galilee Basin.

Minister Hunt’s re-approval of the Carmichael coal mine flies in the face of rising public opposition to the proposal and scientific evidence that shows the mine would destroy 10,000 hectares of habitat for endangered species, including the largest known population of the southern black-throated finch.

“Tens of thousands of ACF supporters from all over Australia have written to Greg Hunt, asking him to reject the Carmichael mine once and for all,” Mr Cousins said.

“Just as Woodside lost its social license to build a gas factory at James Price Point in the Kimberley, most Australians do not want Adani to dig a massive coal mine and export the coal across the Great Barrier Reef.

“ACF will scrutinise this approval decision and carefully consider our options.

“We will use all appropriate means to stop this mine,” Mr Cousins said.

ACF and other environment groups ran ads in major newspapers in August urging Minister Hunt not to re-approve Adani’s Carmichael proposal.

 Three Reasons Adani’s Mega Coal Mine Is Still In Trouble

By Thom Mitchell

New Matilda

16 October 2015

Australia’s most controversial coal mine continues to face huge challenges, in spite of the remonstrations sure to follow the re-issuing of its Federal environmental approval this afternoon, writes Thom Mitchell.

Greg Hunt has brought Indian mining giant Adani’s $16.5 billion Carmichael coal mine, which would be the largest Australia has ever seen if it proceeds, one step closer to approval.

The Federal Environment Minister issued a press release this afternoon announcing he had re-approved the mammoth project, which would also give rise to the largest coal terminal in the world at Abbott Point, near Bowen, adjacent to the Great Barrier Reef, if it goes ahead.

Hunt had granted the project environmental authority last year, but it was cancelled with the government’s consent in August after it realised it would lose a Federal Court challenge because the minister had failed to properly consider conservation advise relating to two threatened species that will be impacted.

But in reality, Adani’s mega-mine is no closer to going ahead than it was yesterday.

Immediately after the government’s court defeat, the Department of Environment announced that it expected the environmental approval would be reissued within two months, and it turns out they were about right.

So how far are the shovels from the Galilee Basin ground where Adani wants to dig 60 million tonnes of coal each year? After more than five years in the planning stage the reality is that, from Adani’s perspective, they’re still about as remote as the proposed inland Queensland project site.

Here are three of the most compelling reasons why.

The Mine Does Not Have State Approval

The project needs both State and Federal approval, and while it’s now regained its green tick from the Commonwealth, the Queensland government is yet to give it the go-ahead.

Although Queensland Labor is highly supportive of the Carmichael mine, the state approval is still tied up in the courts as a result of a separate legal challenge to the one which skewered its Federal authority.

The Queensland Land Court heard evidence earlier this year that eviscerated many of the key claims Adani had relied on to market its project to the state government.

They include embarrassing disparities around job creation figures, groundwater impacts, the endangered Black Throated Finch, and how much the company will actually be forking out in company tax and royalties.

The Land Court is yet to make a recommendation to the state government on whether it should approve the mine, and although the Queensland government is not bound by the recommendation, no environmental authority or mining lease can be granted until that happens.

Although the state government likely wants to approve the mine, it could be politically difficult to go against a negative recommendation from the courts.

And the whole process is likely to take time, which is something Adani no doubt wishes it had more of as it struggles to pin down funds to back the project.

Adani Needs To Find Mountains Of Cash, And It’s Having A Hard Time

Perhaps the greatest risk to the project’s ultimate success is the need for Adani to reach financial close. A pack of 14 major global financial institutions, many of them the top lenders for Australian coal projects, have already ruled out funding the Carmichael coal mine.

The Australasia Director of Finance Studies at the Institute of Energy Economics and Financial Analysis, Tim Buckley said that Adani faces “a $10 billion funding requirement, and you can’t create $10 billion without a bank”.

“There’s not a single bank that has said they’ll provide any [funds],” he said. “It’s not even a question of how much more money they need; Adani haven’t got any money yet.”

“They do not have the financial resources to fund this without the external financial institutions.”

“I was arguing the project was total un-bankable and unviable at the start of this year, and my argument is only more compelling today with the [continuing]collapse in the coal price,” he said.

The bottom line is that when Adani started out on its Galilee gamble around half a decade ago, coal prices were at record highs.

At prices around — or as they often were throughout 2010 and 2011, above — the hundred dollar mark per tonne, most analysts say the project would be viable.

They’ve been hovering in the low sixty dollar range for a while now, and major banks like Goldman Sachs are joining bearish forecasters like Buckley in heralding the structural decline of the coal market.

Documents obtained under freedom of information laws have previously revealed that the Queensland Treasury didn’t think the project was a winner either.

The Federal Environmental Approval May Be Challenged

There is also a very real risk that the Carmichael mine — which has become a focal point for green groups opposed to opening up the virgin coal deposits of the Galilee Basin — will face fresh challenges to its Federal environmental approvals.

The Federal Court case that saw Adani’s approval revoked, brought by the Mackay Conservation Group, was a three-pronged attack. The conservation advise relating to two species, the Yakka Skink and Ornamental Snake, which Hunt failed to adequately consider, was just one of these.

The other two — the impact Adani’s plans to export coal, which would create four time the carbon emissions of New Zealand, and the company’s proven record of poor environmental stewardship in its home state of India — never made it before the Court.

As New Matilda reported back in August, it’s likely that the Mackay Conservation Group will be keen to return to court to probe those issues now that the approval has been reinstated.

On top of that, Acting Principle Solicitor Andrew Kwan told New Matilda that the Queensland Environmental Defenders Office is “revising the statement of reasons Minister Hunt issued with his decision today”.

He said the public interest law firm is already “advising a number of clients in relation to the legal validity of [Hunt’s] decision”.

In other words, Attorney General George Brandis may soon rue the day he shelved his offensive against “vigilante lawfare” after former Prime Minister Tony Abbott was ousted.

Carmichael mine rail link 'not a priority' for concessional loans, says minister

Lenore Taylor Political editor


9 October 2015

The Turnbull government has said a 388km railway essential to the future of the controversial $16bn Carmichael coalmine in central Queensland is “not a priority project” for federal concessional loans from the $5bn Northern Australia Infrastructure fund.

Under Tony Abbott, the Coalition had indicated it was considering offering concessional loans for the rail line. Adani’s Australian chief executive, Jeyakumar Janakaraj Adani, said last month his company was negotiating with the federal and Queensland governments for financial assistance to build the railway to service the Carmichael mine, and potentially other mega-mines planned for Queensland’s Gallilee Basin.

“One of the things they are looking at is how we can ensure that the railway line remains financially viable. I can’t give away too many details, but we are working away at that,” former treasurer Joe Hockey said in August.

But on Friday, the new resources minister, Josh Frydenberg, said Adani was “a commercial operation and it needs to stand on its own two feet”. He said it “wouldn’t be a priority project for the commonwealth” under the Northern Australia Infrastructure fund.

Frydenberg said the government would release overdue criteria for applications to the fund “very soon” but said it would provide finance to infrastructure that “services multiple users, that has predictable cash flows, that has a long economic life and where there are high development costs relative to the operating costs and significant barriers to entry”.

He said the federal government was “not looking to crowd out the public sector, we are looking to partner with state and territory governments”.

Many of the criteria spelled out by Frydenberg may once have applied to a rail line from the Gallilee Basin to the port at Abbot Point, but the other mega-coalmines once planned have not progressed far and Adani is facing numerous setbacks to its attempts to get financing and environmental approval for its mine, as well as low coal prices.

The Queensland Labor government promised during the state election campaign that it would not directly invest in the rail line but has been considering other ways to help Adani, and has been in talks with the federal government about possible federal assistance.

Green groups welcomed the indications from Frydenberg.

“Adani’s Galilee Basin coalmine fantasies should definitely not be financed by Australian taxpayers,” said the chief executive of the Australian Conservation Foundation, Kelly O’Shanassy.

“ACF was extremely concerned when the former energy minister and former prime minister made comments suggesting the $5bn Northern Australia Infrastructure Facility, which was established in this year’s federal budget, could be used to support the Adani project.”

The executive director of the Australia Institute, Ben Oquist, said it was “sensible politically and economically not to use [taxpayer subsidies for] a giant new coalmine in the Galilee Basin”.

“The proposed Adani coalmine at Carmichael would be a massive financial and environmental liability for Australia. Right now we’re seeing a slumping coal price, the freefall in market capitalisation for the world’s biggest coal companies, and a surge of global investment and innovation in renewable energy.

“A massive new coalmine would be an economic white elephant, costing the taxpayer billions, just at the time the world is moving away from coal,” he said.

Adani and the Queensland Resources Council have been contacted for comment.

The Abbott government was angered by a federal court case that delayed commonwealth environmental approval for the Carmichael mine because of an administrative error, saying it was a “vital national project”. It sought to amend federal environmental laws to stop conservation groups bringing legal challenges, but those laws have not been passed by the Senate.

Federal Environment Minister should reject Adani mine on environmental grounds

Australian Marine Conservation Society press release

8 October 2015

The Australian Marine Conservation Society has welcomed news that the Federal Environment Minister Greg Hunt is now seeking further information about how the Adani Carmichael coal mine would impact two endangered species.

Imogen Zethoven, the Great Barrier Reef campaign director for AMCS, said expanding coalmines in Australia would further threaten the Reef.

“To go ahead, the Carmichael mine will lead to the dredging of millions of tonnes of the seabed including seagrass meadows in the Reef’s waters. This would damage the habitat of vulnerable species such as the dugong and create muddy plumes that would travel long distances.

“The mine would also require hundreds more coal ships to transit the Reef’s waters increasing the risk of groundings and collisions.

“The mining and burning of coal causes global warming. It causes the waters of the Reef to warm and the oceans to become more acidic. This kills coral.

“We can approve this mine, pay for this port and dredge the Reef’s waters – or we can protect the Great Barrier Reef. We can’t have both.

“We welcome Mr Hunt taking consideration of the endangered species. Australia’s management of the Reef is on probation from the World Heritage Committee. The world is watching – he must make the right decision for the future of the Reef.

“Approving the Carmichael mine means that we will be severely damaging our most treasured natural asset and the tourism industry that relies on it.

“We need to be investing in the tourism industry that showcases the Reef and creates long term sustainable jobs, not the coal mining industry that threatens it,” said Ms Zethoven.



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