Adani Group chairman Gautam Adani (Mint)
Adani Group chairman Gautam Adani (Mint)

Adani 2 approvals away from starting construction of Australia coal mine project

  • Queensland approved Adani's groundwater management plan for its Carmichael coal mine project
  • The environment approval does not comprise the final approval for the Adani coal mine project

Mumbai: Billionaire Gautam Adani’s controversial Australia coal mine project moved a step closer to securing permission for starting construction, with the nation’s federal government approving its groundwater management plan on Tuesday.

With this, Adani now needs just two more approvals from Queensland state—one, the groundwater management plan, and two, a plan to protect an endangered bird species—before construction can begin. There are a further seven approvals required, but these can be secured while construction is on. The Carmichael Coal Mine and Rail Project is proposed to be built in the state of Queensland.

“This decision does not comprise the final approval for this project," said a press statement by Australian environment minister Melissa Price, who approved Adani’s groundwater management proposal.

“The project now requires further approvals from the Queensland government prior to construction commencing. It must meet further stringent conditions of approval from the Commonwealth before it can begin producing coal," Price added.

Adani’s plans were assessed by the department of the environment and energy, which commissioned independent technical advice from Geoscience Australia and the Commonwealth Scientific and Industrial Research Organisation (CSIRO), the statement said. With this, 16 of 25 environmental plans have been finalized or approved by the Commonwealth and Queensland governments.

In its 2018 annual report, Adani Enterprises Ltd said it targeted production of coal in Australia by FY21.

In a phone interview, Lucas Dow, chief executive of Adani Mining, said: “The respective jurisdictions (federal and state) have different requirements. The plans have been drafted such that they satisfy both state and federal governments in one plan."

A Guardian report on Tuesday said conditions for local government approvals are tougher.

Adani Enterprises had in in 2010 bought the greenfield Carmichael coal mine in the Galilee Basin of Queensland and the Abbot Point port near Bowen in the north. The coal mine is expected to produce 2.3 billion tonnes of coal over its lifetime, generating 10 million tonnes every year. The coal will be transported to Abbot Point port via a rail line, also to be built by Adani. Building the open-cut mine and rail network is expected to cost the group Australian $2 billion (about 10,000 crore).

Plans ran into rough weather when local environmental activists argued that the mine would damage the Great Barrier Reef, groundwater aquifers and wipe out the habitat of black-throated finch, an endangered bird species.

A November 2018 BBC report said the project had been delayed for years because of a series of legal challenges by activists, and by reports evaluating the project’s environmental impact.

Queensland’s Labour government has stalled several approvals to the project, while local news reports in Australia on Tuesday questioned the timing of the government approvals ahead of federal elections in May.

Local protests over the last eight years forced the Adani Group to reduce capital outlay for the project and the annual capacity (from 60 metric tonnes per annum initially to 10 metric tonnes per annum now).The group also cut short the length of the rail line and decided to fully fund the construction from its own resources when both government subsidies and local lending plans were withdrawn.

“We’ve been working for 18 months with the state department and this is the seventh iteration of the plan. It’s a collaborative process involving numerous drafts and we’ve taken the state government’s feedback every step of the way," Dow said.

“Unfortunately, the state government has been unwilling to provide certainty of time and process (for the approvals). We have equipment on site and we can start as soon as the approvals come through. Early work preparation for the rail corridor, the geotechnical work, and a lot of activity has been done in preparation. Ultimately, we will see the mine and rail develop in parallel. We’ve been pushing the state government to provide a timeline, but with the federal government having finalized the approvals, we expect the state department to finalize these plans pretty quickly," he added.

“A legal challenge (to the approvals) is unlikely," Dow said. “We’ve had previous court challenges and we have been successful every time. Our resolve to see this project through is very strong."

The latest permission was granted on the condition that Adani Group substantially increase early warning monitoring between the mine and the Doongmabulla Springs (sourced by underground aquifers) using additional deeper bores and an additional bore site to monitor flows; tightened corrective action triggers requiring an immediate response to any unexpected groundwater impact and commitments to rerun the model addressing all Geoscience Australia and CSIRO concerns within two years of the commencement of coal extraction (noting there are no predicted impacts to nationally protected matters within 15 years).

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