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  Business   Companies  22 May 2017  Adani defers Carmichael coal mine investment decision

Adani defers Carmichael coal mine investment decision

Published : May 22, 2017, 2:18 pm IST
Updated : May 22, 2017, 2:18 pm IST

Queensland govt has failed to decide on royalties amounting to millions of dollars for controversy-hit project.

Chairman and founder of Adani group Gautam Adani.
 Chairman and founder of Adani group Gautam Adani.

Melbourne: Indian energy giant Adani today deferred a final investment decision on its much-delayed 21.7 billion dollar Carmichael coal mine in Australia after the Queensland government failed to decide on royalties amounting to millions of dollars for the controversy-hit project.

Adani wanted the Queensland government to delay the start of royalty obligations on the coal mine it hopes to build in Queensland's Galilee Basin, media reports said.

A final investment decision (FID) on Carmichael was expected from Adani this month. "Adani is advised that the Queensland cabinet did not consider any submission or make a decision on royalties for the Adani project today," Adani's spokesman in Australia said.

The Queensland Cabinet met today and did not make any decision on 'royalties holidays' deal for Adani's project. State Premier Annastacia Palaszczuk said there was no formal submission to Cabinet today, but Adani would pay what it owed.

"It hasn't come before Cabinet at the moment but of course we support jobs right across the state, and I think as a government we can look very clearly at trying to open up the Galilee, the Surat and also the north-west province," she said.

"And at the end of the day it's all about jobs and that's what Queenslanders want," she said. Roads Minister Mark Bailey said there was a "positive and collegiate" discussion and "there was some discussion [about mining royalties], but there's been no decision reached".

"Our position has been very clear, since the days of opposition, we said we would not subsidise that project, that is still our position, we've been consistent year in, year out," Bailey said.

The decision by Adani appears to be an attempt to increase the pressure on the state government to follow through on a so-called 'secret deal' to reduce the company's royalties in the first seven years of the mine's operation, Sky News said.

Under the deal, Adani would reportedly pay just 2 million dollars in royalties annually, which could end up costing taxpayers 320 million dollars in lost royalties. Earlier in the day, the Queensland government rejected reports that it has offered a "royalties holiday" to Indian energy giant Adani project in Australia.

There will be no "royalties holiday" for Indian mining giant Adani, Queensland deputy premier Jackie Trad said. The Carmichael project, which is expected to create hundreds of jobs, has been facing opposition from environmentalists and indeginious groups.

The group has for more than five years battled opposition from green groups who are opposed to any expansion of the port, saying it will cut into the Great Barrier Reef World Heritage Area.

The Adani group entered Australia in 2010 with the purchase of the greenfield Carmichael coal mine in the Galilee Basin in central Queensland, and the Abbot Point port near Bowen in the north.

Tags: adani group, gautam adani, queensland australia, carmichael coal mine, adani's carmichael coal mine