Carmichael project is a study in frustration
Not since the Franklin Dam has Australia’s environmental debate been so dominated by a single project.
Not since the Franklin Dam blockade of the early 1980s has Australia’s environmental debate been so dominated by a single project as it is by Adani’s proposed Carmichael coalmine.
Launched in 2010 as Australia’s biggest new coal project, the original $16.5 billion plan conceived a 60-million-tonne “mega mine” connected to a port by a 189km private railway, creating about 10,000 jobs.
But as Adani’s political backers fell away, along with hopes of a taxpayer-subsidised loan, the Indian conglomerate has scaled back its ambitions to a less remarkable 10 million to 28 million-tonne per year mine employing as few as 1000 people.
The battle has only become more fevered as the project inches closer to reality, becoming totemic of the bitter culture war over coal which has infected politics across not only central Queensland but nationwide.
Carmichael would be game-changing because of its planned railway, which would unlock the Galilee Basin — a vast, untapped coal province that geologists estimate could yield 27 billion tonnes. At full capacity, Adani’s railway could support more than eight coalmines the same size as Adani’s initial project.
Climate activists are adamant the basin’s coal must remain below ground if global warming is to be kept in check. They have unleashed a frenzied political campaign against the project, including targeting MPs in vulnerable inner-city electorates, naming and shaming of companies that consider partnering with Adani, and blockading the company’s port at Abbot Point.
Activists have also attempted to stop Adani through legal action, exploiting every avenue in their search for a silver bullet. Even if they don’t succeed, there are hopes that such legal “lawfare” could burden Adani with so many court cases and regulation that the company simply surrenders.
Adani now faces battles on multiple fronts, most immediately with the Queensland Labor government, which has stalled approving key environmental management plans the project needs in order to go ahead.
Queensland Resources Investment Commissioner Caoilin Chestnutt last month described the regulatory process as an “absolute mess” that could take up to two years to resolve.
She was rebuked by the state’s Deputy Premier Jackie Trad, who leads the party’s dominant Left and has pushed back against Adani in cabinet.
It’s a dramatic shift since 2016, when Premier Annastacia Palaszczuk hailed Adani’s project as offering a “new dawn” for Townsville, which is plagued by high unemployment following the closure of Clive Palmer’s Queensland Nickel refinery. She is now less effusive, saying the mine should go ahead if it “stacks up” environmentally and financially.
Adani Mining chief executive Lucas Dow admits the political sands have shifted in the years since the company announced its original plan to widespread praise, but insists the company will not be pressured to retreat.
“We’ve been at this for eight years, so we’re certainly committed to getting this through. If anything we’re even stronger in our resolve,” Dow says.
“Our project offers an investment in the order of $2bn as you contemplate the mine and rail construction and ramp-up, and that’s in addition to the $3.5bn that Adani has invested in Australia today across port, mine, rail and renewables.”
The labour movement is bitterly divided over the Adani coalmine, with the Left faction, led by Trad, infuriating the CFMEU coalmining union with her call on workers to “re-skill” in anticipation of plunging demand for Queensland coal.
The resources industry counters that, even if demand for coal declines across Europe and North America, there will be surging demand in Asia where Queensland’s high-quality black coal can provide cheap power with lower emissions than foreign brown coal. Dow says the claim that global coal markets are in terminal decline is a “great myth” of the Galilee Basin debate.
“Last year India imported 137 million tonnes of thermal coal. Of that, Australia only exported 3m tonnes, so there’s 134m tonnes of market that Australia can step into … that’s being serviced by Indonesia, the US, Russia and South Africa,” he says.
“The Hunter Valley is already running flat-stick to service Japan, Korea, Taiwan and China — those traditional markets — so the prospect is Carmichael and the Galilee will not cannibalise existing markets but rather open up opportunities for new jobs in other markets.”
Adani’s approach has changed markedly since Dow, a former BHP executive, joined the company as its new boss last May.
Despite Adani’s big promises in the past, the new boss is reluctant even to announce a figure for the number of ongoing jobs at Carmichael, although he says similar-sized mines employ 1500 people.
“One of the things the industry has taught me over the years is that ultimately you want to be able to get through and deliver upon your promises and that’s certainly what we’re focused on,” he says.
Dow has also walked away from a plan, advanced by his predecessor Jeyakumar “JJ” Janakaraj, to make Carmichael the “mine of the future” with at least 45 driverless trucks and “everything … autonomous from mine to port”.
“As far as we’re concerned, it’ll be a manned operation … We don’t have any other plans on the horizon to automate,” he says.
Adani’s political strategy has also been updated. Rather than shrinking away from public debates, the company has started calling out activists and politicians who criticise and obstruct their project.
Most recently, Adani has savaged the state for “shifting the goalposts” on its plan to offset harm to the Galilee’s population of endangered black-throated finches by creating new habitat on a 33,000ha grazing property near the mine.
Despite the company finalising the finch management plan over 18 months of coordination with the state’s Environment Department, the state ordered a damning extraordinary review that recommended tough new rules that now threaten the project.
Adani has questioned the legitimacy of the review, led by Melbourne University ecologist Brendan Wintle, who is known for his scepticism about environmental offsets and his associations with anti-coal activism.
Less urgently, state and federal governments must approve Carmichael’s plan to extract groundwater from the Galilee Basin, which has been assessed by CSIRO and Geoscience Australia.
Climate activists have outlined for the federal Labor Party a legal strategy they could use to revoke Adani’s environmental licence if new evidence emerges on either groundwater or the finch.
Bill Shorten supported the mine before switching course at last year’s Batman by-election, when the inner-Melbourne seat was targeted by the Greens.
Opposition MPs have walked a fine line, signalling to their base that Labor opposes Adani but cannot say so publicly.
The party has also raised questions about the federal department’s decision not to apply tougher scrutiny to a proposed water pipeline — a matter now before the Federal Court.
Opposition hardheads have warned that stopping the coalmine would diminish Australia’s reputation among global investors, especially in India, which is the world’s fastest growing economy, and would expose taxpayers to a multibillion-dollar compensation claim by Adani.
The green movement has vowed it will not be deterred, maintaining pressure on Adani until the mine is stopped.
“Queensland cannot expect to be talking about protecting the reef in its future and at the same time opening up massive coal basins. They are not compatible anymore,” says Lissa Schindler of the Australian Marine Conservation Society.
“If we really want to have a future with the Great Barrier Reef and the tourism industry, it needs to make a choice.”