2 July 2021
Adani Ports and Special Economic Zone (Adani Ports) has announced in its latest Annual Report (page 129) that after setting up the haulage operation for the controversial Carmichael coal project under the Bowen Rail Company (BRC), it is transferring the ownership of BRC to another Adani subsidiary, Adani Enterprises. The significant ownership transfer is being made after Adani Ports’ Sustainability & CSR Committee determined that Adani Ports “will divest its investments in [BRC] to fulfil Carbon Neutral Commitments”.
Since it was revealed last year that Adani Ports set up the Bowen Rail Company, at least eight investors have either divested or set exclusions on future investments in the company due to climate and environmental concerns (see here and here). Clearly, Adani Ports’ willingness to set up the haulage operations for Adani’s coal mine is having a significant impact on its desperate attempts to present a “sustainable” image, but the company’s divestment of BRC does not mean it can escape the reputational impacts of supporting Adani coal and fossil fuels more generally.
Even without BRC, Adani Ports is still up to its eyeballs in fossil fuels. If it is transferring BRC because of its “carbon neutral commitments” then what is it going to do with its ownership of the world’s biggest coal import port at Mundra? Or the new coal and gas terminals it wants to build at Kattupalli? Adani Ports is also supplying land, electricity and water for Adani’s highly polluting coal-to-plastics proposal – will this now be refused? Not to mention that its link to the climate-wrecking Carmichael coal project remains as operator of Adani Abbot Point Terminal (now rebranded North Queensland Export Terminal), the port via which Carmichael coal will be exported.
Additionally, if Adani Ports wants to cleanse its reputation of the stain of the Carmichael project, then it needs to come clean on a number of questions. Namely, how much money has it invested in BRC and how much did it sell BRC to Adani Enterprises for? Adani Ports’ investors and bond arrangers like BlackRock and Barclays would be particularly interested in the answers.
Adani Ports’ transfer of ownership of BRC to another Adani subsidiary once again proves that Adani Group operates as a single entity, shifting resources within the group as needed and therefore investment in any part of the group risks supporting the Carmichael thermal coal project.
If investors and bond arrangers don’t want to be hit with the reputational disaster that comes with supporting Adani Group’s climate-wrecking coal development, then they need to avoid the entire conglomerate.
Fill out the form below to let Adani’s investors know that they are exposed to the reputational impacts that come with supporting a coal mine in 2021.