January 5, 2018 Read More →

Proposed Loan for Adani Mine, Rejected by Queensland Government, May Have Failed Financial Test Anyway

Australian Broadcasting Corporation:

Adani’s bid for a $1 billion taxpayer-funded loan may have been doomed even before it was scuppered by Queensland’s Palaszczuk Government, the Productivity Commission has said. The miner’s proposed Galilee Basin rail line faced rejection by the Northern Australian Infrastructure Facility (NAIF) because it may have failed key hurdles, the commission’s latest bulletin suggested.

However, the commission is yet to analyse a rival NAIF loan bid by rail operator Aurizon, which the State Government will also consider blocking in line with an election promise relating to Adani. State Labor told lobby group GetUp! during the election campaign in November it would veto “any NAIF loan” that enabled Adani’s coal project.

The Productivity Commission’s December newsletter noted that projects seeking low-interest loans from NAIF must “not otherwise be able attract finance, but would be commercially viable once constructed.” There must also be “a public benefit from the infrastructure [to justify the cost to the taxpayer of the short-term assistance provided]”.

“Many of the projects suggested in the media as candidates for NAIF funding — such as the rail line to the Galilee Basin and various large irrigation dams — may fail at least one of these criteria,” it said.

The miner, which is battling to meet its March deadline for clinching finance for the $22 billion project, has since been refused support by Chinese banks and parted ways with its main contractor Downer.

Queensland Treasurer Jackie Trad last month reportedly said the Government would soon decide whether to extend the NAIF veto to Aurizon.

More: http://www.abc.net.au/news/2018-01-05/adani-loan-bid-likely-to-fail-before-palaszczuk-intervention/9305040

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