India could look elsewhere for its coal requirements if Queensland government delays its decision on a royalty holiday deal with the Indian energy giant Adani Group, Australian Resource Minister Matthew Canavan has warned. “India has a massive need for energy resources in the next couple of decades. A huge part of that will be increased coal use… We have the ability to produce the most environmentally sustainable energy resources for India,” Canavan said, referring to the controversy involving the Adani Australia’s 16.5 billion dollar Carmichael coal project in Queensland. “But eventually there’s going to come a point, after seven years, if there are continued deferrals, India will go elsewhere to look for coal,” he said at a press briefing yesterday.
“They (India) will look elsewhere if Australia can’t provide that resource, and that would be a great cost to our country in terms of export revenues, in terms of royalties and taxes and of course most importantly in terms of jobs,” he said. “That’s certainly the message I’ve heard from the Indian Government,” he added. His comments came two days after the Adani Group announced deferring a final investment decision on the project until the Queensland government gave “clarity” over lower or deferred royalties.
Adani, which was due to decide on whether to build the Carmichael mine at a board meeting next week, said they were waiting for the state government to advise on whether it would offer a lower royalty rate or deferred royalties. The Queensland State Cabinet on Monday discussed whether to give Adani a royalty discount or deferral, but no decision was made.
Canavan stressed Adani had already spent billions trying to develop the project and disclosed that Premier Annastacia Palasczuk held urgent crisis meetings last night with her senior bureaucrats.
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Canavan, a Queensland Senator, in a separate interview to the Australian Broadcasting Corporation described “a remarkable and embarrassing situation” for the state for not having a tax regime in place. “This project has been under consideration for nearly seven years now. The Palaszczuk Government has been in power for more than two years, and at the eleventh hour, to not even be able to tell Adani what tax they will pay less than a week before they were going to take it to their board is just unbelievable,” he commented.
According to Adani Australia spokesperson, the company was now waiting for the state government’s decision on the new royalties scheme. “Adani notes the Queensland government has again foreshadowed a new royalties scheme for all new mining provinces in the state,” he said, adding that the company was awaiting a decision on the matter.
Canavan further said that Adani mine would produce 25 million tonnes of coal per annum and in its first stage, it would pay about 100 to 150 million dollars a year in royalties to the state government, depending on the price of coal of course. He said the 320 million dollar figure of royalties concession reported earlier was derived from “leaks and innuendo” and said Galilee Basin was the best place to build a coal mine and that it would potentially create thousands of jobs and make lots of export revenues and royalties and taxes for the country.
Meanwhile, a recent report released by an independent body Climate Council of Australia has warned against the project, stating that the Carmichael mine posed serious risks to the environment, public health and North Queensland tourism.
The project involves dredging 1.1 million cubic metres of spoil near the Great Barrier Reef Marine Park, which will then be disposed of on land.