Adani’s Carmichael coalmine to begin construction within weeks
Adani has announced it will fund its Carmichael coalmine in central Queensland. Picture: Alix Sweeney
MICHAEL MCKENNA 5.39PM NOVEMBER 29, 2018
Adani’s Carmichael coalmine in central Queensland will begin construction within weeks after the Indian conglomerate today announced it will fund the project itself following years of legal delays and protests.
Once touted as Australia’s biggest-ever proposed coalmine, with a target to produce 60 million tonnes-a-year, the project has been scaled back to an initial output of 10 million tonnes-a — year before ramping-up to an annual 27.5 million tonnes within the decade.
The controversial project — once costed at $16.5 billion — is now expected to initially cost less than $2 billion and be in full production in two years.
An estimated 1500 jobs will be created in the construction and “ramp-up’’ stage of the mine and rail project, and several hundred people will be employed on a permanent basis.
The start of construction marks the first mine to tap the massive coal reserves in the Galilee Basin, west of Mackay, where there are at least five other major coalmines being proposed, potentially employing 15,000 people.
The finance decision follows a move this year by Adani to downsize its proposed rail link to Abbot Point port.
Local Adani boss Lucas Dow today addressed a meeting in Mackay of community leaders, mining industry leaders and suppliers, telling them that the Adani Group would now finance the entire project.
Adani Australia CEO Lucas Dow.
It follows a campaign by conservationists to delay the project — first mooted seven years ago — through court challenges, and later lobbying of international banks.
Several major banks refused to finance the project.
“Our work in recent months has culminated in Adani Group’s approval of the revised project plan that de-risks the initial stage of the Carmichael mine and rail project by adopting a narrow gauge rail solution combined with a reduced ramp up volume for the mine,” Mr Dow said.
“This means we’ve minimised our execution risk and initial capital outlay. The sharpening of the mine plan has kept operating costs to a minimum and ensures the project remains within the first quartile of the global cost curve.’’
All coal produced in the first stage will be used by Adani in supplying power in India as the country moves to electrify thousands of villages under a program instigated by prime minister Mahendra Modi.
Mr Dow said remaining state and federal approvals were expected within weeks.
There are at least five other mines in Queensland which produce more than 10 million tonnes-a-year.
“We will now begin developing a smaller open cut mine comparable to many other Queensland coalmines and will ramp up production over time to 27.5mtpa,” Mr Dow said.
“The construction for the shorter narrow gauge rail line will also begin to match the production schedule.
“We have already invested $3.3 billion in Adani’s Australian businesses, which is a clear demonstration of our capacity to deliver a financing solution for the revised scope of the mine and rail project.
“The project stacks up both environmentally and financially.
“Today’s announcement removes any doubt as to the project stacking up financially.
“We will now deliver the jobs and business opportunities we have promised for North Queensland.”
(20min delay)
