India’s billionaire Gautam Adani may have given a “green light” to the vast Carmichael coal mine and rail project proposed for Queensland in northeast Australia, the Guardian reports. But it’s still unclear where the money will come from to build it, and Australians themselves may end up picking up the tab.
Adani, who owns power plants in India, has claimed the A$5 billion mine, with an associated railroad to the coast, will create 10,000 jobs. Others put the number closer to 1,500. But the project has come under stiff criticism as a menace to the climate, on shaky financial ground, and a threat to public health. The investment decision was communicated by an Australian executive—not Adani himself.
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The business magnate has yet to identify financial backers for the project. The company was shaken last month when news emerged that Australia’s Westpac Banking Corporation would no longer finance thermal coal projects like Carmichael. Then India cancelled 13.7 gigawatts of new coal capacity, opting instead for solar at “free-falling” prices, raising questions about the economics of Adani’s long-term coal strategy.
Julien Vincent, executive director of Market Finance, an environmental investment group, mocked Adani’s “green light” as “little more than a PR stunt. Announcing an intention to invest is a far cry from having the finance to do so.” According to Vincent, parent company Adani Enterprises has “yet to raise a single cent of the $5 billion required to capitalize the project,” but must pursue it anyway because “failure would mean a write-down equivalent to around half the value of the company.”
Adani is seeking A$900 million in financing from the Australian federal government. Writing to oppose the loan, a prominent physician compared its possible approval “to supporting big tobacco to transport hundreds of tonnes of tobacco to market.” Kingsley Faulkner, chair of Doctors for the Environment Australia, urged the board of directors of the Northern Australia Infrastructure Facility “to rule out an investment loan to build the rail line from the mine to the Abbot Point port.”
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