Late Night Truce Delivers Royalties Deal to Adani
By Michael McKenna and Sarah Elks
May 26, 2017 - Indian energy giant Adani will be offered a reworked royalties deal at a discounted rate during the early years of coal production at its $16.5 billion Carmichael coalmine, after a meeting of senior Queensland cabinet ministers last night.
A compromise was struck between Queensland Premier Annastacia Palaszczuk and her deputy, Jackie Trad, on the deal that will be used as a template to lure other resources companies into the state’s burgeoning Galilee and Surat basins and the northwest minerals province.
The Australian understands Adani will be given the cut-price flat rate for up to six years — understood to be several million dollars a year — but it will be eventually required to pay the entire amount of deferred royalties owed to taxpayers for coal extracted at its proposed Galilee Basin mine.
Adani will have to pay interest on the delayed amount.
The final touches were being added to the arrangement at a cabinet budget review committee meeting last night before being presented to the full cabinet.
The Premier said a formal submission would be made to cabinet on Monday, but The Australian understands ministers could meet as early as today.
“I’m very keen to open up a number of provinces in Queensland, including the Surat (and) Galilee and also the northwest minerals province, because we recognize there’s high unemployment in regional Queensland,” Ms. Palaszczuk said. “(We’ve) been working late into the night because at the end of the day, this is about people’s futures and about guaranteeing we’ll have more and more jobs being opened up in regional Queensland.”
The factional fight over a royalties deal for Adani has dominated this parliamentary sitting and split Ms. Palaszczuk’s cabinet.
The Indian conglomerate indefinitely postponed its final investment decision — scheduled for Monday — after cabinet deferred a decision on royalties last Monday.
The opposition has targeted Ms. Palaszczuk’s leadership and pointed the finger at left faction ministers — led by Ms. Trad — for the delay.
“What a week of division, dumb-heatedness and disaster from a do-nothing government,” Liberal National Party leader Tim Nicholls told parliament.
“How can the business community, especially those next-wave resource companies with potentially billions of dollars of investment for Queensland, have any faith in a shambolic approach by a government that cannot even govern itself?
“After what they have seen this week, how can Queenslanders have any faith that this resurgent deal can even be honoured?”
The Townsville-based Minister Assisting the Premier on North Queensland, and left member, Coralee O’Rourke was challenged in parliament yesterday to declare her full support for the Carmichael coalmine project. “I thoroughly support the Adani project, and the jobs that it will bring,” Ms. O’Rourke said.
Townsville Mayor Jenny Hill, a member of the ALP, was furious this week at the delay and urged the government to sort out the disagreement so much-needed jobs could be created.
It is understood that once the final investment decision is made, pre-construction works such as landclearing and surveys can begin at the Galilee Basin site.
The major activity will not start until after Adani has secured finance and reached financial close on the project.
Ms. Palaszczuk’s caucus and candidates for the next state election will meet in Brisbane today for a party briefing on the major redistribution of the Queensland electoral map, which will be gazetted today.