News Karnataka
Tuesday, May 30 2023

Commonwealth Bank of Austrailia (CBA) pulls out of Adani mining project

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Ahmedabad: Soon after an Australian federal court revoked environmental permissions to Adani Mining’s $12 billion Carmichael coal mining project in Queensland, the country’s largest lender Commonwealth Bank of Australia (CBA) ended its role as financial adviser to the project on Thursday, according to a Reuters report. This is most likely to delay the project by a year.The Guardian reported that the federal government has said it will take between six and eight weeks to revisit and reconsider its decision.

“Now it won’t happen till 2018. The Queensland government will have to issue a fresh order with required modifications and address those issues pointed out by the court. Adani will comply with whatever due procedures are laid down by the government,” said one of the two officials cited above.

“We confirm that our advisory role has concluded. Due to client confidentiality, we are unable to comment further,” a CBA spokesman was quoted as saying by Reuters.

The company has signed up buyers for more than 75% of the 40 million tonnes that the company expected to produce in the first phase. The production was to begin in late 2017. The company also planned to export coal to its thermal power plants in India.

A surprise election result in Australia’s Queensland state earlier this year led to a policy reversal and led some environmental activists to mount pressure on the government to protect the Great Barrier Reef which is home to Australian lizard yakka skink and ornamental snake.The conservation status of both the yakka skink and ornamental lizard is listed as “vulnerable” in Australia, according to the department of environment, Australian government.

Overturning environment permissions for the mine, the Australian federal court said the country’s environment minister Greg Hunt had “ignored his own department’s advice about the mine’s impact on two vulnerable species”.
The company said in its statement that it has been advised that because certain documents were not presented by the department while finalizing the approval, it created a technical legal vulnerability that is better to address now

The building of the Adani project, which includes development and mining of the underground coal mine and a rail link, was approved by the federal government in July 2014.

The company is committed to ensuring its mine, rail and port projects in Queensland are developed and operated in accordance with Commonwealth and State laws and regulations, including strict environmental conditions, the company said.

“It is regrettable that a technical legal error from the Federal Environment Department has exposed the approval to an adverse decision,” the company said.

It should be noted that the approval included appropriate conditions to manage the protection of the yakka skink and ornamental snake, the company added.

Revenue loss for the state:

“A delay in the project would also mean revenue loss for the government which it would get by way of royalty and taxes once the mine is operational,” the second official added.

Adani is in the fifth year of developing the project and the need to finalize approvals and timelines is critical so Adani and the community can realize the benefits associated with its investments to date, including 10,000 jobs and $22 billion in taxes and royalties to be reinvested into the community, said the company in a press statement.

Adani was awarded the Carmichael coal project in 2010 by the Australian government. The project soon ran into protests from environmentalists. As a result many financial institutions refused funding to the project.


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