Adani’s Australian Coal Mine in Trouble as Chinese Banks Refuse Loans

With three Chinese banks announcing that they will not be financing Adani group’s controversial Carmichael mine in Queensland, Australia, the mining giant’s ambitious project – worth $21.7 billion - appears to be doomed. Earlier this year, Australian banks had backed out of financing the project. Adani Mining is facing a financial crunch as 24 banks around the world have earlier refused to finance its mining ventures in Australia.

Adani’s extravagant expansion into Australian mining seems to be dogged by accusations of crony capitalism and destruction of environment, very similar to the ones in India for his Mundra SEZ project and mining activities. The opposition in Australia however has taken on a much more widespread scale.

Recently, Australian journalists who visited Mundra in Gujarat to study Adani Group’s activities were harassed by local police, presumably at the behest of powers that be.

The Carmichael mine has drawn the ire of Australians ever since Adani bought it in 2010. A recent survey showed that 62% people in Queensland opposed the Adani mine. There have been a series of protests in Brisbane, Sydney, Melbourne, Townsville, Cairns, Mackay and at Adani’s work sites near Belyando in Central Queensland. Such was the pressure built by public opinion that Queensland premier Annastacia Palaszczuk reversed the government’s previous position and pledged to veto a loan to Adani if re-elected. In March this year, 13 NGOs came together to form the Stop Adani Alliance which organized a National Day of Action on October 7. During November 20 and 24, a Stop Adani Shakeup week was observed to pressurize federal MPs into opposing the mine. All over Queensland, and even elsewhere, anti-Adani T-shirts, badges, caps and other protest markers can be seen on people.

Adani group has reportedly faced a series of regulatory actions in India for its riding roughshod over environmental and other laws. It has also been alleged that its explosive growth is largely due to Gautam Adani’s closeness to Prime Minister Modi since the latter’s stint as Gujarat Chief Minister. Recently, Australian Broadcasting Corporation’s investigation on its well known Four Corners programme, unearthed various dealings of Adani Mining through secret tax haven accounts in Cayman Islands and the British Virgin Islands.

The Galilee basin, where the giant mine, projected to be one of the world’s largest, is located contains an estimated 7.8 billion tonnes of coal. Adani group has claimed that the mine will have peak production of 60 million tonnes of coal per year by 2022. The company has acquired Abbot Point coal terminal near Mackay for $1.98 billion from the Queensland government and plans to build a 388 kilometer rail link from the mine to the port. The company is awaiting a concessional A$900 million loan from the government’s Northern Australia Infrastructure Facility (NAIF) for the rail link.

The most significant reason why most Australians are opposed to the mine is its environmental impact. The mine is estimated to generate 4.7 billion tonnes of greenhouse gases. It will also use 26 million litres of water every day severely depleting the groundwater in this drought prone region. The Great Barrier Reef, already under threat from warming of the oceans and their acidification, will also be affected by the mining activity. The project involves dredging of 1.1 million cubic meters of seabed from near the Reef.Experts have vigorously argued that this will have an adverse impact on the delicate ecosystem that sustains the Reef.

Adani Australia have argued that an estimated 10,000 jobs will be created in Queensland, which is currently suffering from severe unemployment. This claim has been supported even by Australian Prime Minister Malcolm Turnbull. However, Jerome Fahrer, an economist who appeared on behalf of Adani Mining before the Queensland land court, testified in 2015 that the project would create precisely 1,464 jobs.

The land where the mine is planned to be built belongs to the Wangan and Jagalingou traditional or indigenous people, and is part of 30,000 sq.kms land area for which they have filed a ‘native title claim’ in 2004. The W&J peoples have launched a long and complicated legal battle to oppose the Carmichael mine, and hearing is scheduled for March 2018.