What the approval of the biggest coalmine in the country means for Australia

JOBS, wealth and the fast-track back to economic growth is up for grabs now that Australia’s biggest coalmine has been approved. But what are we giving up?

Site of Adani's Carmichael Coal mine project.

IF YOU believe the hype, Australia’s biggest coalmine will bring jobs, wealth and provide a fast-track to economic growth. But what are we giving up?

Opinion is divided on whether the Queensland Government’s final approval of the $22 billion Adani’s Carmichael coal mine in the Galilee basin will be good for the country.

The project has been hugely controversial because of its potential impacts on the Great Barrier Reef.

Green groups have criticised the decision, saying the mine will fuel global warming and compound threats to the reef, which is suffering though its worst coral bleaching event on record.

“Protecting the reef and approving the Carmichael mining lease are diametrically opposed. You cannot do both,” Greenpeace reef campaigner Shani Tager said.

The mine would include six open-cut pits and up to five underground mines. But it would involve dredging 1.1 million cubic metres of spoil near the Great Barrier Reef Marine Park.

Queensland Premier Annastacia Palaszczuk believes the project should go ahead.

“Up in Cairns, there’s jobs on the reef. Out here, there’s a big project which is going to generate jobs and the two can coexist,” Ms Palaszczuk said.

Here is what’s at stake:

JOBS AND ECONOMIC GROWTH

The promise of jobs and money are the two most tempting factors at play here.

The three leases issued for the mine site northwest of Clermont cover an area estimated to contain 11 billion tonnes of thermal coal.

Queensland Premier Annastacia Palaszczuk said the project would generate more than 5000 jobs at the peak of construction and more than 4500 jobs at the peak of operations.

But GetUp! organiser Ellen Roberts said the government was exaggerating the mine’s economic benefits, while playing down the damage it would cause to the reef.

“We know that the jobs figures for the Adani mine are exaggerating, we know they keep saying 10,000 (or) 5000, but it’s much, much less than that and it’s been tested in court,” she said.

During court proceedings earlier this year, Adani’s expert conceded it would only create 1464 “job years”.

The reef also provides jobs for tens of thousands of people, Ms Roberts said, while noting the state’s economy was moving away from a reliance on mining anyway.

But it’s not just about the jobs. Once the mine is up and running, millions will flow into the state’s coffers every year.

Mines minister Anthony Lynham and Premier Annastacia Palaszczuk in Mackay with Adani CEO Jeyakumar Janakara to announce the go ahead of the Carmichael Mine. Picture: Tim Marsden

An extra $200 million to $300 million would be paid every year in royalties, and that was based on current coal prices which are low, Queensland’s mines minister Anthony Lynham told ABC radio on Monday.

THE TIMING COULD NOT BE WORSE

In announcing the approval on Sunday, Queensland Resources Council acting chief executive Greg Lane said 200 strict environmental conditions would safeguard the environment.

But reef expert Professor Terry Hughes, the convener of the National Coral Bleaching Taskforce, said the reef was already in the middle of its worst bleaching event, with 75 per cent of corals north of Cairns turning snow white.

“Obviously the timing could not be worse,” he said of the Carmichael approval.

He blamed the bleaching on global warming, which is mainly caused by burning coal.

Activists argue the mine could hurt marine life in the World Heritage-listed site because the coal would have to be shipped out of a nearby port.

Australia narrowly avoided the embarrassment of seeing the reef listed last year as a World Heritage site in danger. UNESCO continues to closely monitor management of the reef and scientists warned that targets to reduce nitrogen run-off and other land-based threats to water quality were unlikely to be met.

Australia is due to update UNESCO on its Reef 2050 plan at the end of this year.

BUT WILL IT ACTUALLY HAPPEN?

Even Adani says it won’t make a final investment decision on the mega mine until two legal challenges have been resolved.

The Australian Conservation Foundation and The Wangan and Jagalingou (W&J) traditional owners have separate legal actions pending against the mine.

The W&J people are waiting for a judgment after Federal Court Justice John Reeves reserved his decision following a hearing in February, while the ACF’s case is set down for a hearing in early May.

ACF spokeswoman Nadia Montague told a crowd of 100 protesters today who gathered outside Queensland’s parliament that they should not give up.

“This is not over, we are still fighting this,” she said.

Protesters have also been putting pressure on banks to rule out funding the mine.

More than a dozen banks have ruled out funding the mine including NAB, Citigroup, Deutsche Bank, Morgan Stanley, RBS, Credit Agricole, BNP, Barclays, Goldman Sachs, JP Morgan and Societe Generale and HSBC.

The #Adani Protest in #Brisbane today seemed momentous. A sign of epic legal battles to come in #auslaw and #auspol. pic.twitter.com/7OopUO8Wap

— Matthew Rimmer (@DrRimmer) April 4, 2016

Adding to the financing issue is the downturn in coal prices.

Thermal-coal prices are near five-year lows. This has coincided with increased supply but reduced demand from China. It has made many new coal projects uneconomic and creates difficulty in raising financing for the big projects.

When the Carmichael mine was first proposed in 2010, it was at the height of the mining boom, a time when investors from countries such as India, Japan and China wanted to ensure their future coal supply.