Adani's Carmichael Mine: Addressing the Facts

This is a post by outgoing Community Campaigner Jacob Miller.

The Adani Carmichael Project has increasingly benefited from State and Federal Government support while the list of financial institutions distancing themselves the project continues to grow. Supporters of the mine try to justify the project, citing the supposed economic benefits for North Queensland and even go so far as to claim coal from the mine will help India reduce its carbon emissions. This post is going examine and dispel the myths that are being used to prop up the case for the Carmichael project.

The Adani Carmichael Mine as ‘Critical Infrastructure’

The Queensland Government declared the Adani Carmichael project ‘critical infrastructure’ in October; reducing the amount of red tape for the project and allowing the Coordinator General to sign off on approvals quickly. The apparent justification for labelling the project critical infrastructure is the much needed economic benefits for Queensland (North Queensland in particular).

The Environmental Defender’s Office Queensland has provided a legal analysis on Adani’s critical infrastructure status which reveals it has never before been used on a private commercial development. Being deemed critical infrastructure, the Queensland Government could fast-track water assessments and potentially strip most review and appeal rights.

Critical infrastructure declarations have only been made on four other occasions in the last decade. Three of those related to water supplies, for example, parts of the South East Queensland Water Grid were declared ‘critical infrastructure’ in 2007 and 2009 as a result of water supplies being at very low levels.

Designating the Adani project ‘critical infrastructure’ is an inappropriate use of legislation that was intended to ensure the delivery of key infrastructure that would serve the public, not private infrastructure profiting a trans-national corporation. Doing so also potentially creates an avenue for other private developments demanding the same status.

You can read the EDO’s full report here.

‘10,000 Jobs for North Queensland’

Adani, the media and the Premier have continue to tout the supposed ‘10,000 jobs’ that the project will produce in our region. The coal industry currently provides only 20,000 jobs in Queensland, a mere 1% of the workforce. Additionally, 10,000 jobs is far from accurate. Adani’s own economist Jerome Fahrer stated the true figure whilst under oath in the Queensland Land Court, saying:

Over the life of the Project it is projected that on average around 1,464 employee years of full time equivalent direct and indirect jobs will be created

Research by Adani’s economist Jerome Fahrer, found that mine and rail operations would employ around 1,800 people directly and 1,000 indirectly. However, this was found to be at the expense of 1,400 jobs in agriculture, manufacturing and other mining projects.

An integral part of the project is automation. The CEO of Adani, Jeyakumar Janakaraj, has stated his intention to fully automate all of the vehicles used in the mine and the entirety of the process from the mine to the port:

When we ramp up the mine, everything will be autonomous from mine to port. In our eyes, this is the mine of the future

Some in the media have spun this as an opportunity to provide remote jobs from Townsville, however these jobs would be few in number and do not represent the blue collar jobs boom that is thought of in relation to the Adani mine.

‘Coal is Integral to the Queensland Economy’

Earlier in the article we showed how the coal industry only provides 1% of Queensland’s employment. The industry represents only 4% of the Queensland governments revenue, roughly the same as car registration. The overwhelming majority of Queensland’s services are financed by other parts of the economy.

The coal industry actually receives a large amount of subsidies from the Queensland government, with taxpayers funding $8 billion worth of coal infrastructure between 2009-2014. The Adani mine has gained conditional approval for a $1 billion loan through the NAIF for its railway line. Adani previously had an agreement with the Newman government for a ‘Royalty Holiday’ for the initial stages of the mine, meaning the state government would receive no revenue. It is still unclear whether this remains state government policy.

The project has also been unsuccessful in finding financial backing, with banks distancing themselves from the project due to its lack of financial viability and community pressure. If banks don’t think the Carmichael project is a good investment, why does our government?

‘Clean Coal will help Reduce Emissions’

If the coal from the Carmichael mine is burnt, it will represent roughly the same amount of emissions New York city produces annually, or 0.5% of the worlds remaining carbon budget if we wish to stay within 2 degrees Celsius global warming. In response to this, advocates for the mine claim that the coal from the Galilee basin is cleaner than coal sourced elsewhere and will in fact help India meet its emissions targets.

The coal that would be mined by the Carmichael project has an energy content of 4,950Kcal, below the benchmark of 6,000 Kcal. It also has an ash content of 26%, more than double the average of 12% for Australian thermal coal. This put it at a lower energy and higher ash content than coal from Russia or Indonesia, and therefore it is not a cleaner alternative.

The coal would be only 10% above the average quality of domestic Indian thermal coal, however as the coal needs to be transported 5-10 times the distance of Indian coal any environmental benefit is lost.

The idea that burning coal can make a positive contribution to our efforts to reduce emissions is absurd, transitioning to a non-carbon economy is the only effective way to reduce emissions and remain under 2 degrees of global warming.

‘Adani’s Coal Will Alleviate Poverty in India’

Those opposed to the Adani project and the continued export of coal have been accused of hindering the efforts to alleviate poverty in India. Ironically, the coal companies that support energy poverty programs in developing countries do not use coal because of its inefficiency. Even Adani’s program in India is based around donating solar street lighting.

New solar in India is now cheaper than coal. Solar tariff bids are currently US$65/MWh and predicted to reach US$50MWh within three years. New imported coal fired power generation requires a tariff of US$90/MWh. As the cost of solar production declines and the technology becomes more popular it will continue to become the cheap and obvious solution for electrifying impoverished neighbourhoods in the developing world.

The Adani Carmichael Coal Mine is a poor investment for our future, it will provide little economic benefits whilst benefiting from government handouts and being a disaster for efforts to reduce carbon emissions.

Much of this information comes from the fact check report by The Australia Institute, available here.

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  • Jacob Miller