Authorisation meeting of the Wangan and Jagalingou People on the 19th March 2016 in Brisbane

WJ letterhead 1

From the Authorisation meeting of the Wangan and Jagalingou People on the 19th March 2016 in Brisbane

Resolution #9 – Adani Carmichael Project

The chairperson read out the following resolution:

“This meeting notes that a proposed ILUA with Adani for its Carmichael Project has been rejected at claim group meetings on two prior occasions, the last occasion being at a meeting held in Rockhampton on 4 October 2014. The meeting also notes that no mandate has been given by the Wangan and Jagalingou claim group to continue or restart negotiations with Adani in respect of an ILUA for the project. This meeting expresses disappointment and concern that the majority of persons who make up the Applicant have ignored the will of the claim group and have:
1. continued to negotiate with Adani for an ILUA for its Carmichael project;
2. engaged a future act lawyer to assist them with the negotiations;
3. accepted sittings fees funded by Adani for the negotiations; and
4. endorsed the holding of an authorisation meeting fully funded by Adani to approve an ILUA.

This meeting also notes that the ILUA proposed by the majority of Applicants to be considered at a subsequent authorisation meeting is in substantially the same terms as the proposal already rejected by the claim group at its meeting on 4 October 2014. Further the meeting notes that the scope of Carmichael Project has not changed and the potential for environmental damage to the traditional lands of the Wangan and Jagalingou People has not been ameliorated.

Having regard to the above, this meeting rejects and does not authorise an ILUA with Adani for its Carmichael project and directs the Wangan and Jagalingou Applicants to:

(a) Immediately cease negotiations with Adani in relation to an ILUA for its Carmichael project and not attend, authorise or support the calling of an authorisation meeting to consider approving an ILUA (to this end we note that a meeting to authorise an ILUA has been called by unidentified persons for 16 April 2016 in Maryborough);
(b) Not attend, support or authorise the calling of any future authorisation meeting to consider authorising an ILUA with Adani (or any successor) for the Carmichael Project unless before doing so it has been given express approval from the claim group to enter negotiations and to call a subsequent authorisation meeting of the claim group for that purpose; and
(c) Repay to Adani any and all monies received (other than travelling and accommodation allowances) since 4 October 2014 for attending negotiations with Adani for an ILUA in respect to the Carmichael Project.”

Carried unanimously.

 

Conveners’ statement to the meeting 

We have convened this meeting because of our concerns with the way the majority of the Applicant has been conducting business amongst themselves and with Adani Mining.

We believe our claim group’s decisions to reject an ILUA with Adani in October 2014, and earlier in December 2012, have been undermined. We say that the Applicant does not have a mandate to go ahead and open new negotiations with Adani. We put our objections on the record and also noted that decisions of the Applicant upon which they relied to do deals with Adani were invalid and unauthorised.

We believe it is up to our people to decide whether we wish to revisit our decisions and not that of Adani and some lawyers and a handful of Applicants.
Adani is not offering self-determination. They are trying to get us to agree to a deal when they cannot say the mine will even go ahead. There is no money to build the mine and the Government won’t give approvals until Adani can demonstrate that they have it. No banks will give them money and most financial analysts and energy agencies say the mine will not be built.

We do not need to sign away rights and our land for an ILUA on the hope of a mine. If Adani cares about our people they can offer contracts and benefits and jobs under their Indigenous Participation Plan, if the mine is ever built.

This is a bad deal in our view. And our people have the right to say no. We made our decisions, why we should we be forced back by a mining company to have to change our mind. They are not offering anything different to what they did previously.

The majority of the Applicants agreed to employ Phillip Hunter of HW Ebsworth to review the proposed ILUA and ancillary agreements. In his review package this is what he has to say:

“As part of the Applicant’s re-engagement with Adani, we were requested by the Applicant to undertake a review of the ILUA and Ancillary Agreement which were taken to the authorisation meeting on 4 October 2014… The review that we undertook was not to re-negotiate the terms of the ILUA and Ancillary Agreement, but to identify necessary amendments to the ILUA and Ancillary Agreement having regard to the above developments.”
So the deal we are being offered is essentially the same as that rejected by the claim group at October 2014 authorization meeting.

How good a deal is it? Well, we have consulted native title lawyers, and believe it is miserly.

Firstly, the mine site covers a huge area of our traditional land (approximately 280 square kilometers). While it is difficult to quantify what would be a fair payment for its affect upon your traditional lands, the negotiations for the rail corridor provide some guide.

The Birriah people, for example, have negotiated a tonnage rate for every tonne coal shipped along Adani’s proposed rail corridor but the same arrangement is not being offered to the Wangan and Jagalingou people for the 60,000 tonnes per year of coal that is going to be extracted from the mine. It is well known in native title circles that in the Pilbara and Kimberley iron ore regions native title compensation is paid on a tonnage extracted from the mines. As a result many traditional owner groups have been paid hundreds of millions of dollars by mining companies for the effects on native title. All Adani are offering to pay is $510,000.00 per year.

Perhaps the meanest insult is the offer to pay the princely sum of $398,750 for the surrender of 2750 HA of native title land. On our traditional lands, due to the large extent of extinguishment that has already occurred, native title is at a premium. Adani boasts that they will compensate for the loss of 9,700 hectares of habitat for the Black Throated Finch by creating offset areas of 30,000 hectares yet they do not offer one scrap of land to us for the extinguishment of our native title. Once Native Title is lost, it is forever. It can’t grow back or recover.

In an attempt to sweeten what would otherwise be a bitter pill, Adani points to the potential for employment and contracting opportunities. A similar situation occurred with our neighbours, the Iman people. They were offered a contract worth $5 million per year to run the catering canteens for the big coal seam gas projects that occurred on their traditional lands. They were told they would get 120 jobs in the process. They had to tender at competitive rates, and use their own capital to set things up. In the end the project went belly up because the income generated from the contract was not sufficient to pay wages, taxes and outgoings. Iman Nation was placed into liquidation. In the process they lost the only property they owned and an estimated $3 million of their own money.

The only full time jobs Adani are projecting from the business and contracting opportunities that they offer are 50 jobs for a Wangan and Jagalingou Bus company. They estimate that these workers will be paid $35,000.00 per year (that’s just $650pw before tax). In Australia (as opposed to India) the minimum wage is $34,158.80per annum plus superannuation at 9.25%. We doubt whether anybody will want to work for $35,000.00 per annum especially having regard to the remote location. All the rest of the jobs are casual (20 cultural heritage workers and 30 environmental and land officers).

In our view, Adani’s promise of jobs needs to be critically evaluated and not accepted at face value. If they eventuate at all, the employment opportunities on offer are likely to be low paid, unskilled and the profitability of the contracts marginal at best.

Adrian Burragubba, Linda Bobongie, Delia Kemppi, Aunty Lester Barnard, Lyndell Turbane
The Authorisation Meeting Conveners

 

Why the Carmichael mine will not go ahead in the foreseeable future

Advice from
Professor John Quiggin
ARC Australian Laureate Fellow
School of Economics
Faculty of Business, Economics and Law

March 18, 2016

Unlikely to cover cash costs
At current world coal prices (below $US50), it is unlikely that the mine could cover its operating costs. Around one-third of Queensland mines are operating at a loss, according toe the Queensland Mining Council. Many are only continuing to operate because they are locked into ‘take-or-pay’ contracts to transport coal.

No capacity to service debt
Even in the unlikely event that it could cover cash costs, there is no possible way that investment in Carmichael could be profitable at current prices. Adani requires at least $10 billion in debt to finance the project. The interest cost and principal repayment required would be around $1 billion per year. With an output of 40 million tonnes a year, this would need an operating profit of $25/tonne, which is impossible at current prices. The obvious conclusion is that no bank would lend money to such project, and this is in fact the case

No finance
The non-viability of the project is illustrated by a long list of banks and other funding sources have announced that they won’t finance the project, or have pulled out of announced and existing finance arrangements.
The list includes the Commonwealth (formerly a big lender to Adani), NAB, the Queensland Treasury, the State Bank of India, and global banks including Standard Chartered (another former big lender), Citigroup, JP Morgan Chase, Goldman Sachs, Deutsche Bank, Royal Bank of Scotland, HSBC, Barclays, BNP Paribas, Credit Agrilcole and Societe Generale.
The US and Korean Export-Import banks have been touted as possible sources, but appear to have backed away. Even the Abbott-Turnbull $5 billion fund for Northern Australia now appears unlikely to support Adani.
Adani’s only active operation, the Abbot Point coal terminal has recently had its debt downgraded to junk status, largely because of inadequate demand.  This would not have happened if the ratings agencies believed that the project will go ahead.

Project mothballed
While claiming that the project will be up and running by 2017, Adani has effectively put it into mothballs. Adani sacked the engineering team from Worsley Parsons and the construction group from Posco (also a supposed equity partner) last year. A $2 billion announcement of work for Downer EDI seems to have turned to nothing. The obvious interpretation is that Adani are hoping to get all the necessary permissions in place to give them an option in the unlikely event of an upturn in the coal price.

What benefits might be obtained from the project
Promises of jobs and royalties (or similar revenue sharing payments) from the project are nearly valueless since they depend on the project going ahead, which is very unlikely. The only financial benefits worth negotiating for are unconditional upfront payments.

__________________________

John Quiggin is an Australian Laureate Fellow in Economics at the University of Queensland. He is prominent both as a research economist and as a commentator on Australian economic policy. He is a Fellow of the Econometric Society, the Academy of the Social Sciences in Australia and many other learned societies and institutions. He has produced over 1500 publications, including six books and over 200 refereed journal articles, in fields including decision theory, environmental economics, production economics, and the theory of economic growth. He has also written on policy topics including climate change, micro-economic reform, privatisation, employment policy and the management of the Murray-Darling river system. 

 

Adani’s Carmichael Coal Mine: how it will affect Wangan and Jagalingou country

Multi-billion dollar Indian company Adani is pushing to build the Carmichael Mine, one of the world’s biggest coal mines, on our country in the Galilee Basin. The mine includes six huge open cut pits and five underground mines. The mine is more than 45 kilometres long and will destroy more than 280 square kilometres of our land – more than twice the size of Toowoomba. There will also be a railway passing through our land to the Great Barrier Reef coast. A new port will be built at Abbot Point near Bowen on the Barrier Reef to ship the coal to India. The mine is proposed to operate for about 60 years and dig up 2 billion tonnes of coal – enough to make a road that “could stretch around the world five times.” But if it’s ever built it will more likely be a ‘white elephant’ as the whole world moves away from coal, and will never make money.
What’s at risk?
The Carmichael mine will destroy our traditional lands and waters, and the animals and plants of our country.  And the damage will be felt way beyond the Galilee Basin, hitting Queensland communities and the Great Barrier Reef. The carbon pollution from the coal will increase global warming. It will place a heavy burden on future generations here and across the world. Our decisions affect many other people, along with W&J people and our descendants.
If we allow this project to go ahead as Adani plans, we risk losing forever a huge part of our traditional homelands, and our connection with our lands since time immemorial. We will suffer:
Permanent damage to our waterways. The mine will take a massive 750 billion litres of water from the Burdekin Basin, which flows into the wetlands and to the Great Barrier Reef, and will harm the Carmichael and Belyando rivers. Huge amounts of groundwater will be stripped from the land and our ecosystems will suffer. The one million year-old freshwater Doongmabulla Springs oasis will likely dry up, and the many plants and animals it supports will perish.

Loss of our plants and animals. One of the many species that live on our land, the black-throated finch, will most likely be made extinct by the loss of habitat. Fourteen other species of migratory birds will be threatened. Other animals that are part of our country such as koalas, the ornamental snake and the yakka skink may be lost, along with our tree species such as the waxy cabbage palm.

There will also be:
• Harm to people and land from the Galilee to the Coast. The railway line from the mine site running hundreds of kilometres to Abbot Point coal port will carve up even more land, interfere with the plants, animals and the environment along the way, dump tonnes of coal dust, and increase flood risks.

Widespread damage to the Great Barrier Reef. The coal will be shipped through the reef to India. Dredging and dumping of the seabed for Adani’s Abbot Point coal port will damage coral, and kill and harm marine life. When the coal is burnt, it will increase global warming. This is warming our oceans and bleaching and killing coral, threatening the survival of our Great Barrier Reef.

Increased carbon pollution from the burning of coal. This coal mine would be so big, each year it will create four times the total carbon pollution emissions of the whole country of New Zealand – 128.4 million tonnes. This poses serious harm for our future generations, who will be worst hit by climate change, and for the world’s people.

About Adani
Multibillion-dollar company Adani has a murky past, and a disastrous environmental track record in its home country of India.  There have been reports of the company being involved in bribery and corruption.

More worrying, Adani has a history of destroying environments and the livelihoods of traditional communities where they operate, as well as failing to follow the government regulations that are there to protect the people and their environment.

The destruction this project will cause has raised widespread opposition from concerned people in the community, including several state and federal court cases, some of which are still ongoing. People around the world are rightly concerned about this proposed mine.
Questions remain about whether Adani will be able to finance the mine. Many of the biggest banks in Australia and around the world have said it is a bad bet, and that they will not fund it.

Adani has told lies about the mine’s benefits to Queensland in terms of the economy and jobs. Adani admitted in court that its claim the mine will create 10,000 jobs is wrong, when the real figure is around 1400. There is no certainty this mine will ever go ahead, and it is probable that the promises of jobs may be empty.

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