Australia Expects Adani to Proceed With Carmichael Coal Project

  • Minister doesn't expect Carmichael to need subsidies
  • Environmental groups continue to oppose new coal mine

The Australian government expects Adani Enterprises Ltd. to proceed with building its A$7.2 billion ($5.2 billion) Carmichael coal mine and rail project in Queensland state after receiving environmental approval.

The project, approved by Australia’s regulators Oct. 15, is financially viable due to global energy demand and is unlikely to receive government subsidies, Australia Resources and Energy Minister Josh Frydenberg said in an Australian Broadcasting Corp. interview Sunday. The Indian company controlled by billionaire Gautam Adani will have to contend with opposition from environmental groups and the lowest thermal coal prices in more than eight years.

“The Carmichael project is of great importance to Queensland and Australia,” Frydenberg said. “We’ve seen a downturn in the price for coal but this project has more than a 40-year lifespan and there’s a clear increase in demand for coal and indeed energy across the world.” Global energy demand is expected to increase by a third by 2040, he said.

Adani plans to build a 388-kilometer (241-mile) rail line to link the mine to the Abbot Point port on the Queensland coast, according to its website. The project is subject to 36 strict conditions, Environment Minister Greg Hunt said in an e-mailed statement Oct. 15.

‘Moral Case’

There was a “strong moral case” to build the mine, as it would help alleviate the need of some poor people to burn wood and dung for cooking, which results in the deaths of about 4.3 million people a year, Frydenberg said.

“That’s more people dying through those sort of inefficient forms of energy than from malaria, from tuberculosis and HIV AIDS all combined," he said.

The claim that exporting coal was moral was “deranged,” Greens Senator Larissa Waters said in an e-mailed statement.

“Burning coal causes local health impacts, with millions of premature deaths from air pollution a year, and pollutes local water supplies,” Waters said. “Of course, the biggest problem it creates is global warming, which is devastating the poorest countries the most.”

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