Adani coal plans take another hit, as Aurizon withdraws loan request | RenewEconomy

Adani coal plans take another hit, as Aurizon withdraws loan request

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Aurizon withdraws application for NAIF funding to build Gallilee rail line, in fresh vote of no confidence in the Adani-led mega coal project.

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The prospects of the mega coal mine and rail project planned for Queensland’s Galilee Basin by Indian giant Adani have taken a fresh hit, after listed Australian freight company Aurizon said it was no longer seeking federal funding to build the project’s rail line.

Aurizon said on Friday that it would be withdrawing its application for funding under Northern Australia Infrastructure Facility, or NAIF, due to a failure to secure “definitive contractual arrangements with any proponent.”

Aurizon was seeking the federal funding to assist with a rail solution for the Carmichael coal mine, a crucial ingredient to opening up the remote Galilee Basin to a potentially huge coal mining and export project that has also caught the attention of Gina Rinehart’s GVK Hancock and Clive Palmer.

In a company statement released on Friday, Aurizon chief Andrew Harding said the company still supported the development of the new Queensland mega mine, but decided it was prudent to withdraw the NAIF application in light of the project’s current failure to progress.

“If market circumstances change and our discussions with potential customers progress to commercial arrangements we will look at all possible financing arrangements to develop the rail solution,” Harding said.

The decision by Aurizon delivers a fresh vote of no confidence to the Adani-led project, which has stumbled from roadblock to roadblock, despite having the in-principle support of the federal government and key Queensland Coalition MPs.

Chief among those roadblocks has been the increasing number of banks – both international and local, including Australia’s big four – that have ruled out backing the project, for both economic and environmental reasons.

Most recently, in December last year, Downer Group announced it had relinquished a proposed $A2 billion non-binding Letter of Award received in December 2014.

This followed on from the Queensland government delivering its veto of the proposed A$1 billion loan subsidy and a multitude of leading Chinese banks vowing to avoid the controversial project the week before.

And late last month, in an address to the National Press Club, Labor leader Bill Shorten undermined the project’s prospects further, by pledging it would not receive the party’s support if it didn’t stack up commercially or environmentally.

“Aurizon has joined a long list of banks and services companies walking away from the Adani project,” said Greenpeace Australia Pacific Climate and Energy Campaigner Nikola Casule, in comments on Friday.

“There is no question that this mine would be an environmental disaster and Aurizon’s announcement is another clear demonstration of the economic unviability of the project.

“If Bill Shorten is standing by the criteria he set only a week ago he must commit to blocking the project should he lead a future Labor government,” Casule said.

“Aurizon’s decision reflects the wider public sentiment, which has become increasingly hostile amid revelations of the Adani Group’s tainted environmental and corporate record.

“While this news is welcome, the battle is not over. Greenpeace Australia Pacific and the Stop Adani movement will continue to take the fight to Adani and its enablers until this nightmare of a project is dead and buried.”

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  1. Joe 2 years ago

    …even China walked away from potentially financing this Environmental Abomination. I have been reading reports that The Townsville Mayor is getting very impatient as Adani fails to meet timelines to get things going. Townsville and Rockhnmpton are supposed to be jointly funding the build of an airstrip in The Galiliee Basin for the fly in, fly out mob……not a cent or sod has moved!

    • mick 2 years ago

      the orica boss is nice & wet for it

    • Peter Campbell 2 years ago

      Perhaps those mayors have constituents who would prefer the money be spent on local parks, library, services etc.

      • Joe 2 years ago

        If I have my information correct that proposed airstrip is at a price tag of some $35 millions that the good citizens of Townsville and Rockhampton are going to stump up. I think you nailed it perfectly…local services can use the money to better effect.

    • Chris Jones 2 years ago

      Yes, the Townsville mayor has given them a 6 month deadline (or what), and should ‘end the speculation. All behind paywalls of course.

  2. Jon 2 years ago

    Nice, this not only makes the Charmichael Mine less viable but also the other proposed mines in the Galilee Basin. 🙂

    • RobSa 2 years ago

      Winning! 😀

  3. Colin Nicholson 2 years ago

    Sadly, all it really means is that Trump will rip the appalachians apart and the Barrier Reef will still cop it. I changed sides when Trump started this. I’m supporting Adani on the basis that with both of them in the market, the capacity vs demand will drive the coal price down to unviable levels

    • Jan Veselý 2 years ago

      Consumption cuts in China, EU, USA, India, etc. will do the same and better.

    • Peter Campbell 2 years ago

      Let the americans resist new coal mines there and we resist them here. Success in either place with embolden resistance in the other. Meanwhile let renewables continue to undercut coal generation. I think we need pressure in the same direction from everywhere.

    • neroden 2 years ago

      Even Trump is unable to bring back coal mining in the Appalachians. There’s not much we can do about the disastrous destruction which has already taken place… but the fact is that Appalachian coal is not cost-competitive for electricity generation any more. It’s dead.

      The existing coal power plants in the US which use Appalachian coal are all losing money and their owners are doing their best to sell them (nobody wants to buy), or get state government subsidies for them (and they’ve failed to get state government subsidies), or close them down.

      In the US, the plants running on Powder River Basin coal (from Utah) are unfortunately still almost cost-effective, which is why there’s been a big environmentalist focus on shutting them down. But the Appalachian coal business is dying: even the coal mining companies are admitting it.

      • Colin Nicholson 2 years ago

        For a man who can rip a trillion in tax cuts out of the US economy, subsidising coal mining to a couple of billion is nothing. Don’t underestimate coal mining enhanced with new mechanisation and Trump is just the guy to do it. The fact that with a new wave of mechanisation, the coal miners won’t get their jobs back is purely incidental to Trump. The spectacle of a fossil fuel industry eating its own is too good to resist – Once the share price starts to go…. To help this along the green industries must make the biggest push possible to drop demand even more for fossil fuel based electricity. Who knows Giles, if I keep talking like this Maybe George P will start posting again

  4. D. John Hunwick 2 years ago

    Don’t be fooled by this announcement. The company involved has not changed its support for the idea of mining in QLD – just can’t raise the money and sign a contract right now. Some organisation should write to these people and threaten them with disruption by ordinary people who do not want the project to go ahead under any conditions. Unless they get a genuine threat and are unsettled by it this will all limp on until pieces of the jigsaw fall into place and us dumbnuts will wake up and find the decision has been made

    • neroden 2 years ago

      Actually, I think the coal mine plans are dying. In a capitalist system “just can’t find the money” means a great deal. Just keep telling your elected officials to make sure the government won’t give them a big bailout… because nobody other than the government will fund this loser any more.

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