Adani and Downer part ways

Adani and Downer have scrapped their agreement to work together on Adani’s controversial Carmichael mine.

In its statement yesterday, Adani blamed the decision on the Queensland government’s decision to veto the $1 billion Northern Australia Infrastructure Facility (NAIF) loan the company had applied for to build for rail link from the mine to the Abbot Point coal port, near the Great Barrier Reef.

One of the first things the newly elected Queensland government did was to fulfil its election promise to veto the loan.

Under the original plan, Downer was set to develop and operate the mine.

Instead, Adani said it will now run the mine as an owner-operator.

“Following on the NAIF veto last week and in line with its vision to achieve the lowest quartile cost of production by ensuring flexibility and efficiencies in the supply chain, Adani has decided to develop and operate the mine on an owner operator basis,” the statement said. 

“Adani and Downer have mutually agree to cancel all Letter of Awards. Downer will provide transitional assistance until 31 March 2018.

“Adani remains committed to develop the Carmichael project and will ensure the highest level of standards and governance. This will not affect our commitment or the number of local jobs across Queensland.”

Adani is also hamstrung by Chinese banks ruling out funding the mine. 

However, Adani said Downer would provide transitional assistance until 31 March 2018.

“This is simply a change in management structure and ensures that the mine will ultimately be run out of our Adani Australia offices in Townsville,” Adani said.

An award winning author and journalist, commentator, lecturer, and speaker, Leon is a freelance business journalist who covers a range of areas including politics, strategy, globalization, leadership and all the big trends ahead. His main skill is summing up all the news that’s around. For the last 30 years, his main focus has been on management issues. He also produces two podcasts for RMIT University, Talking Business and Talking Technology. Leon has worked for Fairfax, News Limited, AAP and the Herald and Weekly Times.

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