The Australian Greens will introduce a Bill into parliament next month in a bid to prevent nearly one billion dollars of public money going to the Indian multinational conglomerate Adani for construction of a rail link to transport coal.
The proposed concessional loan of AUD 900 million (about US$ 677 million) would be made to Adani by the Northern Australia Infrastructure Facility (NAIF).
The coal would be transported more than 300 kilometres from Adani’s planned mega-mine in the Galilee Basin to the Adani-operated coal port at Abbot Point, and would then be exported to India.
The Adani Group is chaired by its founder Gautam Adani (pictured left), whose net worth is estimated by Forbes to total US$6.3 billion
The Carmichael mine – which would be the largest coal mine in Australia, and one of the biggest in the world – would be sited on Wangan and Jagalingou traditional lands. There would be six open-cut pits and up to five underground mines.
The Wangan and Jagalingou traditional owners say the mine would destroy their ancestral homelands and waters, the cultural landscape, and their heritage.
The deputy leader of the Australian Greens, Senator Larissa Waters, says the “Stop Adani” Bill would create a “suitable person” test under the NAIF Act.
This test would examine “investigations and findings against members of the Adani corporate group for fraud, money laundering, tax minimisation, and corruption”, Waters says.
Waters (pictured left) also points to Adani’s shocking environmental track record, which is documented in The Adani Brief, a 34-page report published by Environmental Justice Australia on February 15 this year.
Waters says the Queensland Labour party failed to apply the “suitable operator” test to Adani under Queensland law. This, she says, was exposed by Environmental Justice Australia and Earthjustice in a report published in October 2015.
Under federal law, the Queensland state government can veto any loan accorded by the NAIF, she adds.
Environmentalists say that that Adani’s mine, rail, and port project is disastrous for the Great Barrier Reef, which is already in a critical condition because of bleaching caused by rising water temperatures.
The former leader of the Australian Greens, Bob Brown, says Queenslanders are being kept in the dark about the environmental impact of the mega coal mine and the number of jobs it would create.
“An Adani expert under oath said there would be 1,500 jobs or less, but Prime Minister Turnbull and Premier Palaszczuk say it will create up to 10,000,” Brown said.
“If they have confidence in this figure, why don’t they release the modelling? What are they afraid of?”
Will the damage to the Great Artesian Basin aquifers be repaired, Brown asks. “And, if not, what will the permanent damage to our groundwater be?”
Brown says the Carmichael mine is today’s equivalent of the battle to stop plans to dam the Franklin river in Tasmania, which environmentalists won in 1983. He is convinced that people power will also stop the Adani mine.
The 1982-1983 blockade of the Franklin river was the most successful environmental campaign in Australian history.
In a hard-hitting opinion piece for The Guardian, published in March, Brown wrote: “When I rafted the Franklin in the 1970s, I knew the campaign to save that spectacular river, despite local support for damming it, would become one to test that generation. In 2017, stopping the Adani coal mine is a campaign to test this generation of Australians.”
Brown wrote that the Adani issue was “the environmental issue of our times”. The Great Barrier Reef was at stake, he said, and the Adani corporation’s “dirty coal mine” was an impending disaster with effects that would reach far beyond Australia.
Brown (pictured below) added that lending Adani a billion dollars of taxpayers’ money would be the political mistake of the decade.
“The Turnbull government would be literally paying Adani to ride roughshod over indigenous rights, to contaminate the groundwater of the Galilee Basin, to consign threatened species to the dustbin of history and to increase the already disastrous impact of coral death worldwide,” he wrote.
In March, Brown launched the #StopAdani alliance of 13 environmental groups opposed to the Carmichael coalmine, and more than 150 #StopAdani community groups have formed so far.
“Adani Group companies have an appalling record of environmental destruction and prosecutions overseas, including illegal dealings, bribery, environmental and social devastation, and allegations of corruption, fraud and money laundering,” the alliance states.
The launch of the #Stop Adani Alliance at Parliament House in Canberra on March 22.
Environmental Justice Australia suggests in its latest briefing that governments and private stakeholders should give serious consideration to the Adani Group’s global legal compliance record, “which demonstrates numerous serious breaches with adverse consequences for the environment and local people” and “the possibility that, if this track record continues in Australia, then supporting the Adani Group’s Carmichael Mine and the Abbot Point Port may expose governments and private stakeholders to reputational and financial risks”.
In a report entitled “Off Track: Why NAIF can’t approve the Carmichael Rail Project”, published in December 2016, Greenpeace says the NAIF has criteria designed to make sure taxpayer money isn’t wasted.
“A close look at the rules governing NAIF reveal an independent board would have no choice but to reject this proposal as it does not meet the mandatory criteria,” Greenpeace states.
The Greenpeace report outlines why the rail link project is ineligible for a loan and raises questions about the board’s independence.
In a briefing published in March 2014, Greenpeace says that, in India, Adani has a “long history of environmental destruction, regulatory non-compliance and other illegal activity, including bribery of government officials, unauthorised construction, and tax evasion”.
GetUp! Australia released a video about Adani Enterprises, in which it also alleges that the company has been involved in bribery, corruption, and illegal construction, and has destroyed protected environments.
In the video, GetUp! says that an investigation by the Karnataka anti-corruption ombudsman discovered that Adani was involved in large-scale illegal exports of iron ore.
Adani is also accused of illegally destroying protected mangroves when constructing its Mundra port. The Indian Ministry of Environment and Forests reported that large areas of mangrove were filled with dredge spoil, 75 hectares of mangroves were destroyed in a conservation area, and dredging infrastructure blocked the water supply to large areas of mangroves, drying them up and killing them.
The Wangan and Jagalingou Traditional Owners Council has accused the Turnbull government of being willing to sacrifice Aboriginal people’s rights in pursuit of a deal with Adani for the Carmichael mine.
“The Prime Minister has courted Gautam Adani with the offer of ‘fixing the native title problem’. This is an act of national betrayal,” the council said.
Turnbull is understood to have told the Adani group chairman in a private meeting in India that the issue of native title in Australia will soon be resolved.
The traditional owners say, however, that there are other legal challenges that could prevent the development of the mega-mine.
Spokeswoman for the Traditional Owners Council, Murrawah Johnson, told ABC radio that, with other cases that the council had running, “Adani can’t just depend on the Australian government to change the law for them and think that they can build the largest new coal mine in the world on our country and destroy who we are as a people”.
Johnson told ABC that the council was challenging Adani on numerous grounds “including Adani actually buying the vote of over two hundred people who have before never identified as Wangan and Jagalingou people”.
The people in question couldn’t specify which ancestor in the Wangan and Jagalingou claim group they were descended from, Johnson said.
The Wangan and Jagalingou Traditional Owners Council has denounced the Adani land use agreement as a sham, and is asking the federal court to strike it out.
Spokesman for the council Adrian Burragubba (pictured below) said: “The document Adani is trying to pass off as an indigenous land use agreement with our people is illegitimate.
“We will continue our action in the federal court to have it struck out, regardless of what dodgy deals are tried on in Canberra to prevent justice.”
In February, Australia’s attorney-general George Brandis announced that he would introduce changes to the Native Title Act, which established a framework for the protection and recognition of native title.
The Act set up processes to determine where native title exists and provide compensation where that title is impaired or extinguished. It regulates the way activities impacting upon native title may be undertaken.
Brandis was reacting to a decision taken by the federal court in relation to an Indigenous Land Use Agreement (ILUA) in Western Australia.
The Noongar ruling renders any ILUA agreement that does not have the signed approval of every person in a native title claim invalid. Previously, the signature of the majority in a claim had been accepted.
Burragubba says said the registration of Adani’s purported land use agreement was not being held up because of the decision in Western Australia. The agreement, he says, was engineered through ‘rent-a-crowd, deceit, and dishonest tactics”.
In a letter to The Age today (Tuesday), John Iser from Doctors for the Environment Australia writes that the Carmichael mine fails to stack up either economically or environmentally.
“The mine will damage local air and ground water, further damage the Great Barrier Reef from dredging and ship movement, increase pollution due to coal transport and storage, and create enormous carbon emissions,” Iser writes.
No financial institution considers the project to be a safe investment, Iser says.
“Funds lost from the decline in tourism resulting from reef destruction and the cost of environmental repair will easily outweigh any possible gains. Likewise, jobs lost from tourism are likely to be far greater than short-term gains from mine development.”
According to the Institute for Energy Economics and Financial Analysis (IEEFA), the Carmichael project is likely to be “cash flow negative” for most of its operating life, even with concessional loans.
In a report entitled “Adani: Remote Prospects”, published this month, the IEEFA states that Adani Enterprise Ltd’s equity market capitalisation has declined from more than US$10 billion in 2015 to $1.9 billion today.
“Relative to net debt estimated at $2.5 billion, this capitalisation is wholly insufficient to underwrite even the reduced $5 billion total project cost for Carmichael.”
Since early 2015, the Adani group has seen estimated net indebtedness rise by US$3 billion to $15.9 billion, the new report states.
The director of energy research at IEEFA and lead author of the new report, Tim Buckley, said: “Adani’s proposal has all the fundamentals of a feckless entrepreneurial scheme reminiscent of those last seen in Australia in the 1980s.”
The market for seaborne thermal coal is in rapid decline, Buckley points out.
“Since the purchase of Carmichael in 2010, the forward market value of its coal has declined 50 percent and thermal coal imports in India are down double digits in line with the government’s stated policy to nearly cease imports entirely by the end of this decade.
“Adani took a calculated business risk on this speculative project in 2010, but the world has changed since then. No longer strategically aligned nor financially robust, today it is less a gamble, more a shot in the dark.”
The Indian government has set an ambitious target of 275GW of renewable energy installations by 2027.
“Record-breaking auctions in India for both solar and wind energy have driven down renewables costs to new lows,” the IEEFA states. “Both are now cheaper than new coal in India.”
Buckley says that private capital has already pulled out of the Carmichael project.
“Australian and Indian taxpayers have become the only potential sources of funding, but it should be clear that Carmichael has never looked like more of a stranded asset than it does today.”
In a report published in March this year, the think tank The Australia Institute raises serious questions about the ability of the NAIF, which was set up in August last year, to make responsible loans worth AUD 5 billion.
“The NAIF is still in the process of establishing its basic administrative functions and governance framework,” the institute said. “It lacks key policies it is required to have under its founding legislation.”
The NAIF appears to be under-resourced, the think tank adds. “There are substantial concerns about its governance and transparency, and the current adequacy of its policies and capacities.”
In the case of the “financially and socially risky” Adani project, the NAIF should reject the immense political pressure to fast-track the loan, the institute says.
Larissa Waters says the new Bill, which will be introduced into parliament in the second week of May, when sitting resumes, would strengthen the 1999 Environment Protection and Biodiversity Conservation Act to ensure that environmental history must be considered when projects are approved.
It would also trigger an automatic review of Adani’s existing approvals, focusing on the group’s environmental history.
There would be a review of the approvals for the Carmichael mine, the rail link, and the Abbot Point coal port “in light of the damning evidence that has emerged since those approvals were first given in 2014 and 2015”.
Headline photo: protest rally in Townsville during Gautam Adani’s visit in December 2016. Photo by Natasha Mulhall.
Australia’s oldest and second-largest bank, Westpac, has issued a statement indicating that it will not fund the Adani mine.
It said the bank would limit lending to new thermal coal projects “to existing coal producing basins only, and where the energy content of the coal ranks in the top 15 percent globally”.
Under Westpac’s new, tighter criteria, the calorific value of the coal mined would need to meet the energy content of at least 6,300kCal/kg Gross as Received.
The benchmark cited by Westpac is far above the quality of the deposits in Queensland’s Galilee Basin and the coal that would be mined by Adani, which would have an average energy content of 4,950 kCal/kg.
Westpac’s Chief Executive Officer, Brian Hartzer, said: “Westpac recognises that climate change is an economic issue as well as an environmental issue, and banks have an important role to play in assisting the Australian economy to transition to a net zero emissions economy.”
He added: “As a major lender Westpac is committed to supporting climate change solutions that will drive the transition to a more sustainable economic model, and we have increased our lending target for this sector from $6.2 billion to $10 billion by 2020 and to $25 billion by 2030.”
The Australian Greens welcomed Westpac’s decision, and there were numerous messages of support for the bank on Twitter and Facebook.
Larissa Waters, said: “All the four big banks have now ruled out or walked away from helping Adani spew out 4.7 billion tonnes of dangerous climate pollution.
“But Queensland Labour and Malcolm Turnbull are still backing Adani and want to hand over $1 billion of public funds.”
Waters said the Adani mine woild be a “climate-wrecking disaster” and letting it go ahead would be signing the Great Barrier Reef’s death warrant.
“Westpac’s decision puts Turnbull and Palaszczuk on notice, people power will win and we will stop this mine.
“We can create jobs and prosperity in regional Queensland by investing in renewable energy and community infrastructure, and by safeguarding the jobs in Reef tourism and agriculture that would be lost to coal-driven climate change.”
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