Adani’s Controversial Mine In Australia Will Be Used For Electricity In India

After more than a decade of bitter dispute over its development, billionaire Gautam Adani’s coal mine in Australia, which has become a global symbol of opposition to fossil fuels, is preparing to begin exports.
The operation, which was first proposed in 2010 but has been stalled due to legal challenges, funding setbacks, and a sustained campaign by climate activists, is set to ship first cargoes before the end of December and aims to supply an initial 10 million tonnes of thermal coal annually for at least 30 years.

Environmental activists have joined forces with Wall Street banks, insurers, and investors to oppose the Carmichael mine, which is located inland from Australia’s iconic Great Barrier Reef in Queensland state, providing a microcosm of the escalating international campaign against the most polluting fossil fuel in the last decade.

“Carmichael appears to have catalysed a broader conversation about the future of thermal coal,” said Samantha Hepburn, a mining and energy law professor at Melbourne’s Deakin University. “This is happening not just for activists, but also in boardrooms and among investors around the world who want to avoid toxic investments.”

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However, the start of overseas sales reflects coal’s continuing importance in the global energy mix, a status that led China and India, the world’s two largest consumers, to dilute efforts at the COP26 climate talks to set a global deadline to phase out the fuel. Demand is increasing in parts of Asia, and Beijing and New Delhi’s response to recent power shortages has been to increase coal production.

According to Bravus Mining & Resources, an Adani unit in Australia, Carmichael exports will be used to supply electricity to India and Southeast Asian countries. Analysts anticipate that at least some of the material will be used by the conglomerate’s own power plants, though the company has declined to name its customers.

“We have already secured the market for the 10 million tonnes of coal per annum,” Bravus said in a statement, confirming the company’s export plans. According to the company, “the coal will be sold at index adjusted pricing,” with all taxes and royalties paid locally. Prices for seaborne coal have swung wildly in recent weeks, plunging from a record high in October and then recovering some of the losses.

The project has been scaled back from initial plans for a A$16 billion ($11 billion) operation that could produce 60 million tonnes per year, which the company self-financed. The company also claims to have received more than 100 approvals for the project, as well as conservation strategies such as plans to protect the endangered black-throated finch, which can be found in the project area.

Local mines like Carmichael, according to Australia’s government, could reduce global emissions because the coal is of higher quality and will replace the use of more polluting fuel.

Adani, Asia’s second richest man and the founder of the Adani Group, has come under fire as his companies seek to expand their investments in fossil fuels, such as coal mines and power plants, despite announcing a $70 billion campaign to build a world-leading renewable energy conglomerate.

“We are doing everything we can to make renewables a viable, affordable alternative to fossil fuels,” Adani said at the Bloomberg India Economic Forum last month, endorsing Prime Minister Narendra Modi’s goal of zero emissions by 2070 for the world’s third-largest polluter.

Ending India’s reliance on coal, which accounts for roughly 70% of electricity generation, is critical to meeting that goal, and Adani’s critics point to plans that would nearly double the company’s coal-fired power capacity and dramatically increase coal production.

Tim Buckley, director of energy finance studies at the Institute for Energy Economics and Financial Analysis, said Adani is attempting to walk on both sides of the street.

The Carmichael project has drawn widespread attention due to its initial planned scale, which could have resulted in Australia’s largest coal mine, the fact that it will boost global supply at a time when countries such as the United States are urging consumers to phase out coal use quickly, and opposition from some Indigenous landowners.
Concerns have also been raised that the project, which includes a 200-kilometer (124-mile) railroad, will assist in the development of a series of mines in Queensland’s previously untouched Galilee Basin, a coal-rich region roughly the size of the United Kingdom.

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