Adani Mining has taken another controversial hit as the Commonwealth Bank withdraws from its financial advisory role for the Carmichael project.
The Commonwealth Bank of Australia (CBA) advised that it’s advisory role had concluded yesterday, but was unable to comment further due to client confidentiality.
A spokesperson for Adani said the CBA had not walked away from the relationship, rather that Adani had terminated the mandate "on the basis of its own concerns over ongoing delays to a now five-year long approvals process here in Australia”.
"In the event the Commonwealth approvals framework is not further undermined by activists seeking to exploit legal loopholes – thus enabling the project and the thousands of jobs and billions of dollars of investment it would bring to be delivered – Adani would happily work with the bank in future."
The move has sparked widespread speculation about the ability of Adani to adequately fund the $16 billion project, with the announcement coming the same day as environmental approvals for the mine were overturned due to a government oversight.
Institute of Energy Economics and Financial Analysis (IEEFA) director of energy finance studies Tim Buckley said the split suggested the CBA’s lack of involvement indicated their they did not endorse the project.
"To me, that is a major revelation because ultimately when global banks are looking at projects in Australia, they look to the Australian banks who have the on-the-ground knowledge, on-the-ground feel for the project, to come out and endorse a project,” he said to ABC.
"Then the international banks can piggyback effectively off the local knowledge, and effectively, due diligence of the big Australian banks.”
A number of the world’s largest resource project funders such as Citigroup, Deutsche Bank and Goldman Sachs among others have already said they would not be involved in funding the Carmichael project.
Reports state this is in part because export facilities would be built near the Great Barrier Reef.
On Wednesday the Federal Court overturned environmental approvals for the Carmichael Mine due to failure by environment minister Greg Hunt to properly regard conservation advice about two endangered species, the yakka skink and the ornamental snake.
Adani maintains that the proper environmental management plans relating to the two reptile species were in their submissions to the government, and that there was an administrative oversight on the part of the government.
Environmental groups including the Mackay Conservation Group, which launched the legal action against Adani Mining, have pressured the government to reconsider the economic viability of the project as well as its potential to cause environmental damage through emissions, as well as to the habitat of another endangered species, the black-throated finch.
Environmental Defenders Office of NSW principal solicitor Sue Higginson said the environment minister Greg Hunt not only had to properly consider conservation advices about the two species, but other potential impacts that had been identified since his approval of the mine in 2014.
"If the minister is going to reconsider this project, he ought to do so taking into account all of the relevant impacts associated with the mine or he may expose himself to further legal action,” she said.
The yakka skink now has its own twitter handle, @yakkaskink.