Remember meForgot password?
    Log in with Twitter

article imageProspects for Australia's biggest coal mine in doubt

By Karen Graham     Apr 27, 2015 in Business
India-based Adani Mining still wants to build the largest coal-mining operation ever seen in Australia. But the latest to come out of the proceedings going on in the Land Court of Queensland are telling another story.
At the center of the court case is Adani Mining's plans for the $16.5 million Carmichael coal mine north of the Galilee Basin in Central Queensland. Coast and Country, an environmental group, is challenging the construction of the thermal coal mine and its infrastructure.
The Sydney Morning Herald says Adani executives have made a very poor showing during testimony over the past several days. Adani Mining's financial controller Rajesh Gupta took the stand on Friday, and according to reports, appeared to be either unconvincing, vague or embarrassingly forgetful during cross-examination.
Gupta had to admit the mining company's balance sheet has shrunk considerably after it had to restructure, cutting its borrowing capacity by 80 percent. This announcement goes along with Adani's failure to sell T1, its terminal at Abbot Point, to the Bombay Stock Exchange.
To make things even worse, Adani had to admit the project was not a vertically integrated mine to power station structure, as had been originally planned.
When Gupta was asked if he knew the concessional tax rate for the company in Singapore, he quickly said five percent. Saul Hunt QC, the counsel for Coast and Country then asked, "Are you aware of the effective tax rates in Mauritius?" Gupta said he didn't know.
Hunt: "You're not aware of that. I suggest it's 3 per cent?"
Gupta: "OK."
Hunt: "Would you agree or disagree with that?"
Gupta: "I'll take your word, yep."
Hunt was trying to get to the heart of an issue that has many critics concerned, and that is whether the deal will lead to an economic benefit for Australia. From the way Gupta hemmed and hawed around with his answers, it makes many people wonder.
Adani had submitted information saying the Galilee Basin mine would deliver $22 billion in royalties and taxes to Australia. But under cross-examination, Gupta did not reject a calculation of $7.8 billion, a discrepancy of $14 billion. This week, Adani's economic expert will be testifying as the trial goes on.
The lawsuit brought against Adani Mining by Coast and Country, an environmental group in the Land Court of Queensland began on March 31, as reported in Digital Journal. The Land Court heard arguments that the proposed mine would wipe out the last habitats of the critically endangered southern Black-throated finch.
More about adani mining, australia's largest coal mine, international funding, Galilee basin, thermal coal
More news from
Latest News
Top News