The US-based Institute for Energy Economics and Financial Analysis (IEEFA) has reported on ABC’s Four Corners TV program that Adani’s Australian mining interests are at risk due to falling income from incurred debts on the Indian company’s Abbot Point coal terminal in Queensland.
The IEEFA report states that the company is reliant on recouping over $2 billion in debts incurred through its Abbot Point terminal with its proposed Carmichael mining project in the Galilee Basin, which has yet to materialise amid fervent environmental protests, despite federal governmental approval.
Adani is also facing criticism over Australian tax issues pertaining to newly uncovered key assets being kept in shell companies in the British Virgin Islands.
This is not the first time such practice has come to light. In March it was reported that should the Carmichael mine go ahead, up to $3 billion in royalty deed payments could be shifted to a Cayman Islands-based subsidiary named Atulya Resources, while another BVI-based, Adani-owned company, Carmichael Rail Network, is seeking up to $1 billion in federal government money from the Northern Australia Infrastructure Facility to help finance Adani operations.
Tim Buckley, IEEFA Director of Energy Finance Studies for Australasia, stated, “To the extent able to be analysed from Australian Securities and Investments Commission records, Adani’s entire mine, rail and port operation in Australia looks to be 100 per cent debt financed, and shareholders funds now tally an unprecedented, negative $458 million combined. The value at stake for the Adani Group’s Carmichael mine proposal is far bigger than previously understood.”
Adani has also been mired by environmental concerns since it began Australian operations following the purchase of the Abbot Point terminal in 2011.
In August, the company was fined following excessive sediment releases in the wake of Cyclone Debbie, and the mine’s coastal position is considered a potential risk factor in the decline of the Great Barrier Reef.