The Australia government has said it would delay environment clearance to GVK Power and Infrastructure?s A$10-billion ($9.72-billion) coal mining and rail project in Queensland province, in a move that would set back the company?s plan to tap the strong demand for coal in India.
?I am stopping the clock on the Alpha project. We have no interest in a delayed process. But we are not willing to compromise environmental standards,? environment minister Tony Burke was quoted as saying by agencies. He said GVK must work with national authorities to secure clearance for the project.
This came as a surprise as the federal government was not expected to halt environment clearance to the project which had already bagged the go-ahead from the provincial government. However, GVK remains confident about securing federal government?s green nod for the project. ?The work conducted over the last four years has been extremely robust and a very detailed process has been followed. GVK remains extremely confident of a positive outcome,? the company said.
Last year, GVK acquired 79% equity stake each in Alpha Coal and Alpha West Coal Mines and 100% equity stake in Kevin?s Corner Coal Mines, located in Queensland from Hancock Coal Pty for $1.26 billion. These mines have reserves of about 8 billion tonne and a capacity of more than 80 million tonne per annum. When combined, these projects will create one of the largest thermal coal mining operations in the world. GVK has acquired 100% stake in a 500 km rail link and a 60 million tonne per annum port as part of the ?pit-to-port? logistics solution.
The conservative Queensland government, elected in March, is keen to clear a backlog of resource schemes, with around A$51 billion of projects awaiting approval. Last week, it gave the go-ahead for GVK?s Alpha project in a move that would normally trigger a 30-day deadline for approval from the national government. But Burke said the new state government was shambolic and that its approval fell short of national standards.
Burke said officials from GVK were already working with the federal government and that he was confident a decision could be made ahead of the company?s planned final investment decision on the Alpha project later this year.
The scheme is the front-runner among several projects in the untapped Galilee Basin in Queensland, where rival Indian group Adani Enterprises is planning an A$10.9-billion coal and rail project.
The decision reflects a tougher national approach to projects which could impact on the Great Barrier Reef off the Queensland coast, and follows a UN report warning of threats to the reef posed by industrial developments.