Ahmedabad: Beset by protests over environmental concerns and legal and regulatory hurdles, energy giant Adani Group on Thursday said it will self-finance a scaled-down version of the Carmichael mine in the coal-rich Galilee Basin of Australia.

Adani Mining’s Carmichael mine and rail project will be entirely financed through the billionaire Gautam Adani-led Adani Group’s resources, Adani Mining CEO Lucas Dow said in Central Queensland.

Dow said construction and operation of the mine will now begin. “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," said Dow in a media statement issued by the Adani group.

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, the company said. All coal produced in the initial ramp-up phase will be consumed by the Adani Group’s captive requirements.

The coal mine was earlier projected to produce 60 million tonnes per annum (mtpa) with initial production of 40 mtpa every year but the company will now scale down the operations.

“We will now begin developing a smaller open cut mine comparable to many other Queensland coal mines and will ramp up production over time to 27.5mtpa," Dow said in the statement.

Adani has previously said it expects to begin shipping coal from the mine by 2020-2021. The Carmichael coal mine project, which was meant to be one of the world’s biggest coal mines, was announced in 2010 with an estimated cost of $16.5 billion. It was almost immediately hit by protests by environmental activists and court cases.

“The capital requirement has reduced significantly. The previous figure included a longer rail line, a larger mine, sustaining capital over mine life and a major port expansion. We are not providing a figure for the new delivery model but industry experts have estimated the capital requirement for the initial construction and ramp up of the mine and rail will be around AUD$2 billion," //a company representative/the company said in response to an e-mailed query.

He, however, refused to give a new timeline for the project while clarifying that the previous time line no longer applied.

Adani, which has already invested $3.3 billion in the project, has battled protests by environmentalists who claim the coal project would increase carbon pollution and cause irreparable damage to the Great Barrier Reef marine park in northern Queensland.

The project has been delayed by at least four years now after it ran into resistance from environment activists. As a result, Australian banks have come under pressure to review their lending to fossil fuel developments, with Westpac Banking Corp. in April last year ruling out involvement in Carmichael.

In December last year, the Queensland government vetoed Adani Group’s application for a $1 billion commonwealth loan to build a railway line for the massive mine.

The Adani Group had also initiated talks with China Machinery Engineering Corp. (CMEC) for financing but this did not materialize, said an industry expert in the know of the development. He spoke on conditions of anonymity.

“The project stacks up both environmentally and financially," said Dow. “We will now deliver the jobs and business opportunities we have promised for North Queensland and Central Queensland, all without requiring a cent of Australian taxpayer dollars."

The Australian Conservation Foundation said Thursday’ announcement meant Adani was a “step closer" to building its mine and called on elected representatives to intervene.

The Carmichael Project is expected to deliver more than 1,500 direct jobs on the mine and rail projects during the initial ramp-up and construction phase, and will support thousands more indirect jobs.

In June last year, Adani group chairman Gautam Adani announced that the board of Adani Enterprises, the flagship company of Adani Mining, had given its final go-ahead to the project.

“We have been challenged by activists in the courts, in inner city streets, and even outside banks that have not even been approached to finance the project," chairman Adani said in a stock exchange filing on 6 June, 2017.

In 2016, the Queensland department of environment and heritage protection issued the final clearance for the project in the Galilee Basin. Also in the same year, Adani won a major legal battle when the Australian apex court dismissed appeals lodged by Aboriginal activist Adrian Burragubba as well as a Brisbane-based environmental group against the project.

According to a 5 November media statement by Wangan and Jagalingou Traditional Owners, representatives of the group travelled to Korea this month to urge investment banks there to shun the Adani coal project.

“The ‘Stop Adani’ movement will fight this proposed mine every step of the way. There is too much at stake," the group said in a message on a social media platform.

Adani has so far obtained 112 approvals for the project and been successful in nine court challenges to reach this stage, according to //a company spokesperson who spoke on condition of anonymity.// The Carmichael Project has been granted approvals under seven different Commonwealth and Queensland Acts.

“Coal from Carmichael project will contribute to cleaner electricity generation by replacing dirtier coals. It is also important to put the output of the Carmichael Project into perspective. At 27.5mtpa production from the mine is equivalent to 0.5% of world thermal coal demand in 2017," he said.

“Given we meet the same environmental standards and operate under the same regulations as other miners, we expect that Adani Mining will be treated no differently than any other Queensland mining company," said Dow.

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