TUESDAY 6 JUNE, 2017: Adani’s expected ‘investment decision’ concerning its proposed Carmichael mine is little more than a PR stunt, according to environmental finance group Market Forces.
With a net debt estimated at $2.5 billion, Adani Enterprises has yet to raise a single cent of the $5 billion required to capitalise the project, relying on handouts and subsidies from the Commonwealth and Queensland Governments. However, it has no option but to pursue the project because failure would mean a write-down equivalent to around half the value of the company.
23 banks have so far either distanced themselves publicly from Galilee Basin coal export projects, or introduced policies that prohibit financing Adani’s mine. Only last month, Westpac was the latest institution to rule out funding the proposal. Commonwealth Bank is the only Australian bank which has not committed to steer clear.
“Announcing an intention to invest is a far cry from having the finance to do so,” said Market Forces Executive Director Julien Vincent.
“A pauper might have the intention to invest in a new yacht and harbourside mansion, but that doesn’t make it any more likely to happen.”
“The investment decision we really need to worry about is that of the Northern Australia Infrastructure Facility, which may be about an announce a $900 million loan to Adani on behalf of the Australian public.”
“Adani Enterprises is laden with debt and India’s rapid move away from imported coal makes its project a dud prospect,” said Vincent. “As a consequence, private finance is giving it a wide berth, with the Australian taxpayer the main dupe left at the table.”