Adani may walk away from its giant Carmichael coal project in Queensland, Australia, if the project continues to be delayed in the courts.
Speaking to The Australian newspaper, Adani’s Chairman and Founder, Gautam Adani, expressed his disappointment that the project was still to receive the necessary approvals after six years of environmental assessments and court battles.
“You can’t continue just holding,” Adani said. “I have been disappointed that things have got too delayed.”
Last year, the billionaire met with Australia’s Prime Minister Malcolm Turnbull to ask for his intervention to help give greater certainty on projects like Carmichael.
The Carmichael project in Queensland’s undeveloped Galilee Basin comprises a giant coal mine, railway and port development at Abbott Point. The project could ship 60 million tpy of thermal coal to Adani’s coal-fired power plants in India.
The project has been held up consistently, however, by legal challenges brought by environmental groups concerned at the impact the project on the environment.
There have also been questions raised over the project’s financial viability with many financial institutions, including banking giants, HSBC and Deutsche Bank, saying they would not fund the project. Last August, Australia’s Commonwealth Bank withdrew as the project’s financial advisor calling it “both harmful to the environment and commercially infeasible”.
“Without the endorsement of a local bank, which foreign banks rely on to provide the necessary due diligence and on-the-ground knowledge and expertise, it is unlikely that the Carmichael project will secure sufficient financing for its development,” said BMI Research in a recent note.
Despite these questions, Adani said that he was still confident the project could get funding and be competitive with other sources of coal – providing there were no more unexpected delays.
Edited by Jonathan Rowland.