Queensland government to help fund Galilee coal mines

The Queensland government is set to help fund new coal mines in the Galilee Basin in a bid to entice investment banks to back the projects.

The investment deal is set to be announced today and is expected to cover rail, airport, water, port and electricity infrastructure.

This includes plans to take a short-term equity stake in Adani’s 310km railway that will link the yet-to-be-built $16 billion Carmichael mine to Abbot Point coal terminal.

Adani Australia chief executive Jeyakumar Janakaraj said the deal would help ease any concerns investors were having about bankrolling the coal mine.

“It gives confidence to investors who are considering their long-term plans in the basin that the state is committed to the best possible infrastructure being in place to support the further development of the Galilee, and the jobs and exports that will provide,” Janakarajsaid.

The Australianreports that the rail deal would hinge on the condition that Adani allow third parties to access the line.

GVK Hancock and Clive Palmer’s Waratah Coal are also planning to build on massive new mines in the coal rich region.

Deputy Premier Jeff Seeney told The Australian that investments in infrastructure would be short-term with the government to sell its interests in the next five to ten years.

Seeney said he expects the Bank of India to offer a $1 billion loan to Adani off the back of the government’s announcement.

“The bankers want this sort of endorsement from the state government, and we want these projects to go ahead because of the estimated 27,000 jobs it will create and the money that will flow into the state,’’ Seeney said.

“If everything goes to plan, Adani wants to start construction in the first quarter of the year and take advantage of the low-cost construction environment at the moment.’’

Environmentalists want the Galilee to remain undeveloped, claiming the new mines will have adverse impacts on the climate as well as the Great Barrier Reef.

If the proposed coal mines in the Galilee go ahead, 100 million tonnes of coal will be shipped through the reef per year.

During his visit for the G20 summit, U.S President Barack Obama said the Great Barrier Reef was at threat from climate change.

“Here in the Asia-Pacific nobody has more at stake when it comes to thinking about and then acting on climate change,” Obama said.

“Here a climate that increases in temperature will mean more extreme and frequent storms, more flooding, rising seas that submerge Pacific islands. Here in Australia it means longer droughts, more wildfires. The incredible natural glory of the Great Barrier Reef is threatened.”

Although the President said he did not have time to visit the reef, he said he planned to revisit Queensland in order to do so.

“I want to come back, and I want my daughters to be able to come back, and I want them to be able to bring their daughters or sons to visit.” Obama said.

On Sunday, Queensland Premier Campbell Newman moved to assure Obama that the government was serious about protecting the reef.

“If the president is concerned about the reef I absolutely want to reassure him we’ve got a government that’s really solid on reef protection, and there are many examples of that,” he told reporters.

“One thing I’ll be doing in the future is making sure that US officials perhaps know more about what actually is going on because there’s been a very strong campaign of misinformation by green groups.

“They’re determined to misinform the world community about what’s happening to the reef.”