The Adani group, that operates in mining, energy, and logistics, has been awarded the $15bn worth Carmichael coal mine and rail project in Queensland state of Australia. The Galilee basin mine is estimated to be holding 20 billion tonnes of coal, will produce 60 million tonnes of coal that can be used in thermal power projects. “This project has the potential to be the largest coal mine in Australia and one of the largest in the world,” said Jeff Seeney, Queensland’s deputy premier, while announcing the award to the Indian company.
The Adani group was said to be put 190 conditions before the award of the contract. Australia’s federal government, after a sanction from the environment ministry will issue the final go ahead to the project.
Biggest objections to the project are coming from environmental groups who are fearing for the Great Barrier Reef, in the region. The coal will have to be exported to India from the Abbot Point port which has also been sanctioned to be developed. But the Abbot Point will need about 3 million cubic meters of mud lifted and dumped in the Great Barrier Reef to make it operational. Environmental groups are saying that such mud dumping will destroy the micro organism structures older than human civilization.
Industry experts are saying that the project may not take off till after 2020, as the current coal prices. trading below $75 is not feasible for any company to develop the mine and export it. The lo energy, high ash type coal the mines are holding will not cover the operational costs at current market prices and will have to wait till the rates cross $100, say experts.
But the Adani group chairman, Gautam Adani has said that the company is committed to delivering the project as fast as it could.
Another Indian company, GVK is also operating in the Galilee Basin coal, partnering with an Australian business tycoon, Gina Rinehart.