In spite of Adani Australia CEO Lucas Dow’s claim last year that the corporate energy giant did not require a cent, the company looks set to sign off on a secret royalty deal with the Queensland government.
Adani will receive a $900-million-seven-year low interest royalty capital subsidy on September 30. This will mean Queensland will not receive a royalty return from Adani’s mine for years.
Tim Buckley, from the Institute of Energy Economics and Financial Analysis (IEEFA), said on August 29 that Adani would receive many billions of dollars in subsidies from the federal, Queensland and Indian governments over the next 30 years.
He estimates that Adani will receive more than $4.4 billion of tax exemptions, deferrals and capital subsidies from Australian taxpayers to get its mine operational.
Buckley reviewed several subsidies and exemptions being awarded to Adani, including the royalty holiday, the fuel tax credit scheme, 22 billion litres of water annually, a 90 kilometre private road (disputed by Adani), final void rehabilitation exemptions and corporate tax shields.
Buckley pointed to the contradiction of the federal and Queensland governments that have repeatedly stated Adani’s mine is “commercially viable” while they provide it with billions of dollars in subsidies.
Buckley said: “Adani says it’s on track to receive a record high royalties deal from the Queensland government … despite Adani claiming it doesn’t need the money, and despite the Queensland government stating it would not provide any public money to the project.”
He said the mine is “entirely contrary to Australia’s international commitments under the Paris Agreement” and called for the subsidies to be directed to projects that “help prepare and transition Australia’s regional communities, and those which are likely to generate corporate taxes”.
The Australia Institute’s latest research shows that, under existing arrangements, Adani is already effectively receiving 17% of its coal for free compared to royalty regimes in other states. Any deal agreed by September 30 will be additional to this existing subsidy.
[The Stop Adani campaign is urging people email Adani and the Queensland government to ask about the secret royalty deal.]