Adani to go ahead with projects in Australia despite govt change

Indian mining giant Adani has said it will go ahead with its $15 billion mine, rail and port projects in Australia's coal-rich Queensland state, amid speculation that the victorious Labor Party in the state may reverse the policy and create new trouble for the company.

In a statement, Adani Group said that the election result does not influence the company's financial decision making.

Unlike Liberal National Party which has supported the Adani's Carmichael project in the GalileeBasin, the victorious Labor Party in the last week's election has said the project must be self-sustaining and it will not commit any taxpayers money towards it.

Adani CEO Jeyakumar Janakaraj said the company will work with every partner and every government in ensuring that the important projects proceed.

He said Adani's decision to proceed or not to proceed with this important investment was based on one thing that was the cost basis of the project which remained the case.

Importantly the mine at Carmichael which lies at the heart of the projects, will be within the first quartile of the cost curve, he added.

Adani said it welcomes the opportunity to work with the new premier and discuss a project that will deliver 10,000 jobs and $22 billion in taxes and royalties that the state government needs to invest right back into frontline services in the state.

Tim Buckley of the Institute for Energy Economics and Financial Analysis, which opposes new coal developments, has pinpointed that the new Labor-led government elected has the key policy framework of "Saving the Great Barrier Reef".

The Labor Party has committed to remove state subsidies for the Galilee coal and associated rail projects, banning Reef dumping and to ensure no dredging is undertaken at Abbot Point prior to financial close on any project.

"This election result will return the focus of Adani's $15 billion Carmichael coal mine plus associated rail and port infrastructure proposal to the key questions of financial viability and strategic logic in the face of the structural decline of seaborne thermal coal markets," Buckley said.

Buckley said that under the "Saving the Great Barrier Reef" policy, the Labor Party has committed to ban the sea dumping of capital dredge spoil within the Great Barrier Reef World Heritage Area, it does not support the plan to dump dredge spoil from Abbot Point onto Caley Valley Wetlands and that the party would ensure that dredging does not go ahead until Adani has demonstrated its project has financial close.

"Labor will not spend taxpayer money to build a private rail line for a private commercial project...Labor will not do any secret deals," Buckley said about the party's policy.

"The commercial viability of Adani's Carmichael proposal without this government support is highly questionable," he said, adding at least the port project will not be allowed to commence until financial close, currently not scheduled until the end of 2015.

"There are serious questions for the incoming executive in Queensland to examine how and why such lavish promises by way of enormous public subsidies were made to the Adani group in the face of conventional economics and our, and many others, continued analysis that showed this proposal was unbankable on commercial terms," said Buckley.