The Queensland Government and Indian coal conglomerate Adani are mired in controversy again this week, with a freedom of information request uncovering documents that show the Queensland Treasury not only assessed the $16 billion Carmichael mine as unbankable, but it was frozen out of key decisions on the project. The documents show that Adani’s high level of debt and unclear corporate structure left senior Treasury officials expressing serious concerns about approving the mine. They were worried the project would be pushed through without proper due diligence by the Department of State Development, Infrastructure and Planning, led by Deputy Premier Jeff Seeney. In November 2014, Seeney’s department signed a series of agreements with Adani, putting Queensland taxpayers on the hook for $455 million without any guarantee it would be repaid. Since then, the incoming Palaszczuk Labor government delayed Abbot Point dredging decisions and promised to cut taxpayer support for the controversial rail link between the Galilee basin and the port. As both are needed for Adani’s project to get off the ground, Adani recently suspended work on the Carmichael project and rumours are circulating that it may dump it altogether. This has been interpreted as a veiled threat to the government to get on with approvals and taxpayer support, which appears to have worked, with it calling for expressions of interest on port dredging. With a UNESCO decision on the Great Barrier Reef “in danger” listing imminent, the Palaszczuk government has a crucial decision to make. It can either stick to its election mandate and protect the Great Barrier Reef; or it can break its major election promise, ignore treasury advice, due diligence, and revelations of inflated job and royalty figures, and risk the reef for an unbankable, unburnable coal project.
- Share: QLD Government says Carmichael coal mine is unbankable (350.org)
- Share: Queensland Government can’t have its reef and dredge it too (The Age)
- Sign: Standard chartered: Coral, not coal (Greenpeace)
- Sign: Tell the CEOs of ANZ, Commonwealth Bank, NAB and Westpac to say no to Reef destruction (Greenpeace)
- Sign: Dump Your Bank (AYCC)
- Hashtags in use: #coal #wealthdestroyer #savethereef #SOSReef #FightForTheReef
- Even the Queensland Treasury doesn’t see Adani’s coal project as viable. Documents obtained under freedom of information show the Treasury is concerned about Adani’s level of debt, its capacity to take on the multi-billion dollar Queensland projects, its ability to repay the public money given to the project, and even its level of transparency. Eleven international banks, including HSBC and Deutsche Bank, have already ruled out financing the project, and with the growing global stampede away from coal Adani is looking increasingly desperate.
- It is extraordinary that Treasury would be frozen out of decisions made about a $16 billion project that was to be handed hundreds of millions of taxpayer dollars. Proper due diligence is bafflingly absent from Adani’s Carmichael project, and missing despite it admitting to have inflated job and royalty figures, a lack of clarity on its corporate structure, and grave threats to the Great Barrier Reef. Elected in one of the largest swings in Australian political history on a platform of reef protection and restoring integrity to Queensland politics, the Palaszczuk cannot ignore its own Treasury’s advice, abandon due diligence, and allow climate and reef-destroying destructive coal projects to go ahead.
- ‘Black Elephant’ coal projects such as Adani’s risk becoming stranded assets. Should the desperate gamble to secure public money pay off, all that will be left is a legacy of environmental, economic and job destruction. The reality for coal projects is that the way humanity gets electricity is changing forever. Scientists warn that coal expansion is incompatible with a healthy Great Barrier Reef; supposedly “clean coal” carbon capture and storage (CCS) projects continue to fall over internationally, while they are defunded in Australia; and we know 95 per cent of Australian coal needs to stay in the ground to avert dangerous climate change. Fortunately, China’s appetite for coal is declining, and given Australian coal could double energy costs for Indian consumers, it is little wonder that Queensland’s Treasury thinks Adani’s project is unbankable.
- Adani’s Carmichael Mine is unbankable says Queensland Treasury (The Sydney Morning Herald)
- Treasury had doubts about Carmichael mine (Nine News)
- Adani Mining: Senior Queensland bureaucrats frozen out of government’s Galilee Basin deal (ABC)
- Adani may junk $16bn Oz project (Times of India)
Tools and resources
- Report: Galilee Basin – Unburnable Coal (The Climate Council)
- Report: A review of the Adani group’s environmental history in the context of the Carmichael coal mine approval (Environmental Justice Australia)
- Report: Report- Remote Prospects: A financial analysis of Adani’s coal gamble in Australia’s Galilee Basin (IEEFA)
- Report: Are there 27,000 jobs in the Galilee Basin? (The Australia Institute)
- Report: Queensland Taxpayers’ $2 billion Abbot Point Subsidies Bill (The Australia Institute)
- Report: Protecting the Great Barrier Reef (Environmental Justice Australia/EarthJustice US)
- Report: The Impacts of the Abbot Point Development on the Outstanding Universal Value of the Great Barrier Reef World Heritage Area(Australian Coral Reef Society)
- Report: Reef 2050 Long-Term Sustainability Plan (Australian Government)
- Report: Cooking the Climate, Wrecking the Reef (Greenpeace)
- Records: Adani donations to ALP and Liberal Party (AEC)
- Report: Auditor General report: Managing water quality in Great Barrier Reef catchments (QAO)
- Briefing: Great Barrier Reef report (Environmental Justice Australia & Earthjustice US)
- Infographic: What would you choose? (The Australia Institute)
- “The only person foolish enough to invest in this white elephant has been Campbell Newman, using Queenslanders’ money against the advice of his Treasury. Now Labor are treading the same path by using taxpayer money to dredge the Reef for the same unviable project, despite campaigning on ‘saving the Reef’ to win the election. Queenslanders were furious with Campbell Newman for trying to squander funding that could have gone to education and health on the dying coal industry and they booted him out at the election. The same will happen to Tony Abbott if he follows in Campbell Newman’s footsteps by giving handouts to big mining companies to dig up the Galilee through the Northern Australia Infrastructure Facility.” Australian Greens Deputy Leader, Qld Senator Larissa Waters.
- “Queensland Treasury knows Adani’s Carmichael proposal is an economic basket case in Australia. The Queensland premier must immediately call a halt to any moves to spend taxpayers’ money on Adani’s port, mine and rail projects – including via subsidies – and require a full and formal due diligence assessment of Adani’s capacity to undertake this development.” NQCC spokesperson Jeremy Tager.
- “The minute Adani stops moving forward, the project is just dead, in my view. And the reason is you’ve got billions of dollars of debt in Australia and they’ve got this interest bill. They’ve been drawing a line in the sand and that is that they need financial close by October 2015. If they’ve got no banks lined up, which I don’t think they have, you can’t go to financial close.” The Institute for Energy Economics and Financial Analysis’ Tim Buckley.
- “It appears the Department of State Development went rogue on this particular project and they didn’t want to consult with Treasury, they didn’t want to consult with Premier and Cabinet. They didn’t want advice.” NQCC spokesperson Jeremy Tager.
- “Without putting too fine a point on it, this is shaping up as the whitest of white elephants. No, more than this, this is an elephant which does not merely lack financial viability but which is also a calamity for the environment.” Journalist Michael West.
Related Tree Alerts
- Calls for investigation into coal giant Adani in wake of tax haven scandal
- Australia chooses coal over coral, spins Great Barrier Reef decline to UNESCO
- Adani and Australian governments gamble reef, public funds and climate for coal
- 2015: the year that coal broke
- Study shows keeping most coal in the ground is the only way to contain climate change
- Coal Industry swaps CCS for spin as Greenpeace report pinpoints 91 dangerous projects
- RT @SamRegester: .@QLDLabor You’d never support a project your own Treasury advised you against, yeah? http://t.co/Iu2pfqqsDb
- RT @MarkWillacy: Key officials from Qld’s Treasury & Premier’s Dept frozen out of key decisions about $16billion Adani mine project http://t.co/N8DrnqHB4X