The Adani group’s proposed plan to build a 7-billion-dollar coal mine was on Monday cleared by Australia’s Queensland state which also announced a major investment in rail infrastructure to support the Indian conglomerate’s mega project.
The Adani group welcomed the decision of the Queensland government to clear the project in the Galilee basin that will ensure that one of the mega mines proposed by the company and GVK gets a clearance next year.
Adani Mining Australia country head, Jeyakumar Janakaraj, noted that the announcement reflects the longstanding practice that has applied in comparable greenfield basins, such as the opening up of the Bowen Basin.
“While we have invested several billion dollars in our integrated mine, rail and port project to date, and are well-established on our course to build a long-term future with Queensland, any policy such as this that underpins confidence in significant infrastructure investments – any announcement that encourages additional investment from other players in the Galilee – is welcome.
“This announcement, coupled with Adani’s MoU with the State Bank of India for funding the development of the Carmichael Mine, reflects the confidence close observers of our project have in our fundamentals.
“We are bringing on board valued partners in different facets of this integrated project, ensuring we will meet our guidance of first coal in 2017,” he said.
Adani is the proponent of the North Galilee Basin Rail (NGBR), Queensland’s first standard gauge line, that is the centrepiece of the company’s integrated mine, rail and port project, which will leave a valuable infrastructure legacy for this state in helping open up job-creating projects for Queenslanders in the Galilee.
The three proposed mega-projects in the Galilee Basin– Adani’s 16.5 billion dollars Carmichael mine, GVK’s six billion dollars Alpha mine and Clive Palmer’s 6.4 billion dollars Waratah coal — is expected to create 28,000 jobs.
The company has also signed a Memorandum of Understanding with State Bank of India (SBI).
“The MoU provides for a credit facility of up to 1 billion dollars subject to the detailed assessment of the company’s mine project at Carmichael, near Clermont in Western Queensland,” the company said.
The mine, which holds a Joint Ore Reserves Committee (JORC) -certified resource in excess of 11 billion tonnes of thermal coal, is the centrepiece of Adani’s integrated mine, rail and port project in Queensland, and a key plank of the company’s value chain going forward.
SBI has long been a key financier of the company’s job-creating power, infrastructure and diversified projects in India and abroad, the company said.
“The MoU with SBI is a significant milestone in the development of our Carmichael mine. It is a unique asset that lies at the heart of our investment in Queensland and Australia, and aligns perfectly with our clear vision for delivering energy security in the Indian market,” Adani Group Chairman and Founder, Gautam Adani said.
Adani Mining CEO and Country Head, Jeyakumar Janakaraj, added that the MOU and other agreements nearing their conclusion send a clear signal to the market that the company’s project is on track for first coal in 2017.
This project, which is evincing interest from private and public financiers in India and abroad, will deliver 10,000 jobs and 22 billion dollars in taxes and royalties to Queensland in addition to helping Adani deliver cost-efficient power in the Indian market.
The state government has further underlined the importance of the project by announcing on Monday its willingness to invest in export-enabling infrastructure, namely the rail component of the project, the company said.
With two-way trade between the two countries set to exponentially increase, SBI’s expected support will not just assist one of its largest clients meet rising energy demand in India, but will also help Australia fulfil its long-term future with India as a reliable and valued energy exporter, a central focus of the two countries’ deepening ties,” it said.