Adani’s Carmichael project set to take off soon

Adani’s Carmichael project set to take off soon

Gautam Adani. REUTERS

The controversial Carmichael Coal Project proposed by Adani Group promoted Adani Mining in the coal-rich Galilee Basin of Queensland in Australia, is set to see the light of the day soon, after a long wait of five years, the Australian government officials have confirmed.

Australian Minister of Resources, Matthew Jones Canavan is confident that the long pending project will take off early next year, before the elections in the country. Australian federal elections could take place anytime from Australia Day (January 26, 2019) onwards (and before May 18, 2019).

“From Commonwealth government’s perspective, we have always supported the Adani project and will continue to do so,” Canavan told DH.

Yet another minister from Australia's federal government said the government has granted a conditional approval to the rescaled project by Gautam Adani-owned Adani Mining.

“My understanding is that the Carmichael project has essentially received all necessary environmental approvals. But some particular plans need to be approved within the conditions of the operation that have been granted to date. Structure of both at State level and Federal level is that they have received conditional approvals and there is need to demonstrate that they are meeting the elements of those conditions,” Simon Birmingham, Australia's Federal Minister of Trade said.

Adani Group has proposed to carry out coal mining at Galilee basin in Central Queenlsand. The company acquired the mine in 2010 and has not been able to commence operations due to legal hurdles.

Most projects in Australia are granted conditional approvals, that are focussed towards management plans. According to government officials, the company's plans include dust management, groundwater management, and native bird management.

Canavan confirmed that Adani group has submitted those plans in the last few weeks and are with federal and state governments for assessment. “Almost always, those plans work through the governments and the approval is granted because the overall approval has already been granted,” he said.

As per the rescaling of the project, the Adani Group has junked the earlier plan of connecting the mine to the port, by developing a 388 km long railway line. The group is expected to construct only 189 km of the railway line that will connect the mine with the existing railway line.

Also, the coal mine was earlier projected to produce 60 million tonnes per annum (mtpa) with initial production of 40 mtpa every year but the company will now scale down the operations. The project is expected to create 3,100 jobs for the locals.

“We will now begin developing a smaller open-cut mine comparable to many other Queensland coal mines and will ramp up production over time to 27.5 mtpa,” Adani Mining CEO Lucas Dow said in a media statement.

The company is planning to invest AU$ 2 billion (over Rs 10,000 crore) in the project and plans to ramp up the investment later, which the company would be self-financing.

Earlier, State Bank of India (SBI) had faced a lot of criticism for approving Rs 6,000 crore loan for the company, as 13 Australian banks had rejected the loan proposal, reportedly on the basis of environmental concerns.

Adani, which has already invested AU$3.3 billion (over Rs 15,000 crore) in the project, has battled protests by environmentalists in Australia who claim the coal project would increase carbon pollution and cause irreparable damage to the Great Barrier Reef marine park in northern Queensland.

However, the government is confident that there would be no environmental concerns this time. “Environmental approval processes that we have applied for Carmichael project have been rigorous and thorough and comprehensive in their assessment and project proponents are now working to meet those standards that have been set. Not to say that some green activists and others may not seek to litigate matters. We believe that our Government process in granting those approvals have been thorough and within the legal framework,” Birmingham said.

The officials are hopeful that the new government after the country’s general elections will also support the project.