Home > Economic policy, Environment > Who will pay for Adani’s infrastructure? We will

Who will pay for Adani’s infrastructure? We will

October 7th, 2017

A couple of days ago, it was announced that the Fly In Fly Out workforce for Adani’s putative Carmichael mine would be split between Townsville and Rockhampton. Since I’ve long argued that the mine is highly unlikely to go ahead, I didn’t read the news stories closely. So, I missed the fact, buried in the middle of this ABC news report, that the deal requires Townsville and Rockhampton councils to build Adani an airstrip at a cost of $20 million. It turns out that not everyone in Townsville is happy about having their money spent on a project far away from the city.

This outcome is consistent with what I and others have been arguing for some time. Adani has to keep the project alive to avoid recognising the loss of the money its spent so far, and admitting that coal volumes at its Abbot Point port will be far lower than planned. On the other hand, there’s no point throwing good money after bad. So the strategy is to move slowly on the development, building a railway with money from the Commonwealth government and, now, an airstrip paid for by the people of Townsville. When, with much regret, the mine is deferred indefinitely, the Australian public will be the proud owners of a railway to nowhere, with the option of a flight back.

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  1. October 7th, 2017 at 07:58 | #1

    Is “putative” a Spanish word?

  2. Ronald
    October 7th, 2017 at 08:06 | #2

    “Puta” is and is suitable word to describe aspects of the situation when translated into Queenslandic.

  3. Julia Perry
    October 7th, 2017 at 20:35 | #3

    Is there any information on how much Adani has donated directly or indirectly to the Queensland ALP and the Federal Coalition?

  4. rog
    October 8th, 2017 at 04:31 | #4

    Townsville mayor says “The belt tightening undertaken as a result of the reform process of the last 12 months enables Council to invest without borrowing.”

    When did Council become an investor and/or developer?

    It seems that the law is behind them; they can paint with a wide brush.

    http://www.austlii.edu.au/cgi-bin/viewdoc/au/legis/qld/consol_act/lga2009182/s9.html

  5. Ikonoclast
  6. Stockingrate
    October 8th, 2017 at 14:49 | #6

    1. Why have Australians become such a soft touch? My 2 cents.

    False hope: A psychological refusal to accept that living standards are declining such that that any stimulus, asset sale, debt increase, asset lease, visa sale/overpopulation stimulus, education sale, PPP, pokie palace, infrastructure spend, football stadium spend, services spend, that might conceivably momentarily stave off a decline is seized upon as worthwhile.

  7. Ken Fabian
    October 8th, 2017 at 18:00 | #7

    Disappointing that Premier Palaszczuk’s response to Adani being skewered by Forkies has been to repeat the mantra-ish “jobs for Queenslanders”. Has anyone who matters actually answered questions without retreating into empty slogans?

  8. hc
    October 8th, 2017 at 19:13 | #8

    The question is why the Queensland Government is so intentionally dishonest or obtuse in supporting what is a lousy deal. Is it because they believe that promoting ATANI will give them a handful of seats in redneck Queensland?

  9. Ikonoclast
    October 9th, 2017 at 08:22 | #9

    @hc

    I can only assume Qld and Federal Labor get or expect donations from Adani. Also, it might be a “good” deal for Qld if Federal subsidies are larger than Qld subsidies. One should emphasise “might” and “if” in that sentence. It would always be a bad deal for Australia which is what we should care about most.

    So, yeah, Qld Labor see donations and seats for them in it, nothing else. It’s sad these people don’t govern for the good of the state and the nation. How can we make them do this? Well, for a start I would suggest voting for parties other than and politically left of the duopoly parties. Logically, one has to vote Green and/or Socialist and send as few preferences to the duoply parties as is possible under the system. We have to destroy the duopoly parties at the ballot box. We have to agitate for genuine proportional representation perhaps like the N.Z. model.

  10. Smith
    October 9th, 2017 at 08:27 | #10

    @Ikonoclast

    Proportional representation would mean One Nation with 20% of the seats in the next Queensland parliament. Be careful what you wish for.

  11. Ikonoclast
    October 9th, 2017 at 13:27 | #11

    @Smith

    The 2015 Qld State Election results show One Nation gained 0.92% of formal first preference votes. In the 2016 Federal election the results show One Nation gained 1.29% of the primary vote.

    Where you get your implied 20% seats claim from is a mystery to me. The numbers simply do not support it. This is unless you are implying they would draw 20% support overall if contesting all seats.

    I would suggest that One Nation types could not organize such a large party successfully over the mid to long term. They would commit faux pas all over the place, splinter and generally disgrace themselves. One electoral cycle would be enough for them to flash in the pan and then self-destruct.

    Also, it is bad practice in general to favour a biased system just to keep minors or populists out of seats. Most of them would self-destruct and turn out to be one-termers anyway. Imagine those galoots subject to press scrutiny. Most of them wouldn’t last.

    It is the current biased system which keeps the neoliberal duopoly of ALP and LNP in power (one or the other) and provides no real political alternatives to people. It is this that we need to address.

  12. Smith
    October 9th, 2017 at 14:34 | #12

    @Ikonoclast

    Actually 15%, based on the latest opinion polls.

    “It is the current biased system which keeps the neoliberal duopoly of ALP and LNP in power (one or the other) and provides no real political alternatives to people. It is this that we need to address.”

    You sound just like La Hanson herself, or Marine La Pen.

  13. Robert Banks
    October 9th, 2017 at 15:17 | #13

    Is it being too much of a conspiracist to interpret Adani as simply:

    – transferring public funds to an investor who will return some of those funds to the coalition as donations ie siphoning public money to support re-election (this seems to cover most current energy “policy” on the right), and
    – anything that runs down the public funds is to be encouraged since it reduces future effectiveness of government?

  14. Ikonoclast
    October 9th, 2017 at 18:30 | #14

    @Smith

    “You sound just like La Hanson herself, or Marine La Pen.”

    Really? When I said:

    “I would suggest that One Nation types could not organize such a large party successfully over the mid to long term. They would commit faux pas all over the place, splinter and generally disgrace themselves. One electoral cycle would be enough for them to flash in the pan and then self-destruct.”

    Does that sound like I am a right-winger, populist or a One Nation supporter? No, it does not. If you had been paying attention you would realise my voting sympathies run towards Greens and Socialists.

  15. Ikonoclast
    October 9th, 2017 at 18:35 | #15

    @Robert Banks

    That’s the plan mate. It’s straight from the Omega Files playbook by the Adam Smith Institute. That was the set of plans Thatcher used. In the Institute’s own words, “the Omega Files, (are) a collection of 600 policy initiatives published by the Adam Smith Institute in the 1980s.”

  16. Ken Fabian
    October 9th, 2017 at 22:18 | #16

    I’m not so sure the continuation of support for Adani is based on their donations – rather the support from the beginning was about that unquestioning “mining is good” mindset. The mining lobby supported it, the potential for royalties to government coffers and export earnings to the overall economy from the world’s biggest coal mind, plus the always welcome “jobs and growth” element encouraged an excess of optimism. And a reluctance to look too closely or critically. Other Australian based mining magnates with interests in the Gallilee basin may have had more influence than Adani; having infrastructure put in place, by Adani and with NAIF or other support that lifts the potential value of their otherwise unexploitable mining leases there, without them paying for it must be attractive.

    No, I don’t think it’s Adani donations or gratuities at work even if I don’t doubt those are there; I think that Palaszczuk’s and Turnbull’s governments (and let’s not let Federal and state oppositions off the hook here; they’ve been supporting it too) have to know the whole thing is a house of cards but they want Adani to do the backing out.

    None of them want any admissions they were wrong and misjudged so badly haunting them. Avoiding responsibility rather than shouldering it has become the most prized political skill.

  17. Ikonoclast
    October 10th, 2017 at 06:33 | #17

    Some extractive industries are becoming an unnecessary evil. It is patently clear that we don’t need coal. Why can’t our political class see this? One, we will exceed safe CO2 emissions if we burn any more coal. Two, renewable power supersedes coal any way.

    The other thing about mines “bringing prosperity” to regional areas is this. Mines run out and the show moves on. Mt Isa has been the exception but even this mineral deposit will exhaust eventually. The gold mines of Charters Towers ran out. Charters Towers went from a boom town (second largest town in Qld late 19th C to just another small town today. There is one secondary mine up there today which “wringing out” the last gold.

    The Century Zinc Mine (located up near Lawn Hill Gorge) boomed and busted over about 22 years. Now, it’s a ghost mine. The council was grading dirt back over the (poorly constructed) bitumen mine road when I was up there a couple of months ago. Sure, a remediation company comes in and goes through the tailings for a bit more zinc, but that’s a secondary, wringing out operation.

    Mining towns go bust sooner or later. Mines run out, the show moves on. Mines do not bring permanent prosperity to regional areas. One generation of prosperity is about the average. Sure Mt. Isa is the exception but even it will exhaust.

    On the other hand, renewables like agriculture and solar power can keep (some) towns running indefinitely if done sustainably. This is not an argument against mining overall (except coal mining) but it does suggest it is foolish to look to mines for permanent regional prosperity. Mines are a short regional economic fix historically speaking.

  18. Ken Fabian
    October 10th, 2017 at 08:07 | #18

    @Ikonoclast
    Mostly agree. Metallurgical coal is still going to require significant advances in alternative smelting methods and will be the coal that gets displaced last. Renewable energy at the scales needed globally will use resources in huge quantities and can’t be done by policies that are anti-mining. Responsible mining has to be the rule not the exception. A renewables powered future is not going to be one designed by The Greens, it will be by more mainstream participants, who will continue to compromise – and likely will make compromises someone like me think should not be made. I’m still rather astonished that we are in the position we are now, where solar has the largest share of new build electricity generation and with wind, are eclipsing all other forms of generation.

    Coal has been multi-generational – there is so much of it, often with new mines opening in the same regions as previous ones that it does get seen as a perpetual enterprise. Add the exploitation of otherwise unminable coal – CSG – and there is too much potential for messing up the climate so badly that some of those resources will become unusable because of local climate impacts alone.

  19. Paul Norton
    October 13th, 2017 at 07:33 | #19

    Ken Fabian @16, that’s very well put and very much on the money.

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