Adani will proceed with scaled-down plans to build a mine and 200-kilometre rail operation in Queensland’s Galilee Basin, with the Indian energy group saying it will fully fund the project.
Perhaps the most controversial Australian coal project in recent memory, Adani’s Carmichael plans have seen a $5 billion federal loan taken off the table by the Queensland Government, a drawback of support from several major banks, strong opposition from climate activists, and scepticism from some analysts.
But the miner, represented in Australia by local chief executive officer Lucas Dow, is now saying it has secured 100 per cent of the required funding for the Carmichael mine and rail project, and is ready to begin construction.
“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,” Dow said on November 29.
“This means we’ve minimised our execution risks 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.”
Adani’s initial plans for Carmichael were to spend $16.5 billion to build a 60 million tonne per annum coal mine, and a dedicated, 388-kilometre, standard gauge rail line to export facilities at Abbot Point.
The miner now plans to build a project which scales up to a final capacity of 27.5 million tonnes per annum, supported by a new 200-kilometre narrow gauge rail line connecting it to Aurizon’s existing rail network.
Dow said the initial cost of the project would be $2 billion.
“We will now begin developing a smaller open cut mine comparable to many other Queensland coal mines and will ramp up production over time,” Dow said.
“The construction for the shorter narrow gauge rail line will also begin to match the production schedule.”
Dow said the new plan stacks up financially and environmentally, and would deliver jobs and business opportunities to the local economy “without requiring a cent of Australian taxpayer dollars”.
“We’re ready to start mining and deliver on our promises to Queensland,” he said.
“We want to thank [the people of North and Central Queensland] for sticking with us. Thanks to the people of Rockhampton, Townsville, Mackay, Bowen, the Isaac and Central Highlands regions. We look forward to delivering on our promise of creating jobs and helping local businesses and the communities thrive for many years to come.”