Tuesday 19th Dec, 2017

Queensland election the latest setback for Adani

Photo: Annastacia Palaszczuk / Twitter
Photo: Annastacia Palaszczuk / Twitter

Labor’s apparent victory in Queensland’s state election over the last weekend has been labelled a “death knell” for Indian energy giant Adani’s proposed Carmichael coal mine and rail project.

Adani has reportedly vowed to forge ahead with Carmichael, despite the Palaszczuk Government saying before the election it would veto a nearly $1 billion loan from the Commonwealth’s Northern Australia Infrastructure Facility for the project, if it was elected.

Queensland LNP leader Tim Nicholls claims the election is not over, but prominent ABC election forecaster Anthony Green has called a Labor victory, with Palaszczuk’s party expected to win the 47 seats it needs to just scrape a majority with 78.2% of the vote counted.

Nicholls was in favour of the Adani mine before the election.

After supporting the project, in principle, to help win over regional Queensland, the Palaszczuk Government declared it would veto a NAIF loan just days before the election, in a move said to help win over Green preferences in the state’s south-east.

Given Adani has stressed the importance of a significant loan from Australia’s state and/or federal governments to show it has some “skin in the game,” the election may indeed be a “death knell” for the project.

That’s the viewpoint of former Federal LNP leader John Hewson, who wrote this week in an opinion piece that he suspects the mine will not go ahead.

Already rejected by dozens of global banks, including Australia’s big four, the Carmichael project would likely have to rely on rumoured support from China’s state banks if the NAIF loan was withheld.

But Hewson believes China is wary of “the potential consequences of getting involved now that the project lacks direct financial support from state and federal governments in Australia”.

“This is especially so when the issue of Chinese influence and involvement in Australia generally, and in our politics specifically, is becoming controversial,” Hewson wrote in his column, published by The Conversation.

“The bottom line for financing is an assessment of the longer-term risks with Adani Enterprises, the family, and the project. Both the company and the family are already heavily exposed financially, and the project is a high-cost, high-risk one.

“Bearing in mind the Paris climate agreement, the rapidly falling costs of reliable renewables, and India’s shifting energy strategy, the development of any new coal mine is certainly a very big call.”