Project delays are costly for Queensland

June 24, 2016

Delays of major mining projects in Australia, like those that have pushed back construction of Adani’s Carmichael coal mine and rail project to 2017, have impacted Queensland’s economy to the tune of $3.9 billion according to a new PwC report commissioned by Adani.

The report compares the changes in timing of major projects and identifies the results of these delays, indicating an estimated loss of $3.9 billion over the next decade to 2023-24.

Adani’s Carmichael Mine development would include an integrated rail, mine, and port infrastructure and is expected to eventually produce 60 Mt/a (66 million stpy), with construction initially expected to begin in 2012-13 and first coal produced by 2016. However, construction has been pushed back to 2017 due to several approvals processes and legal challenges, Australian Mining reported.

The PwC report found an estimated reduction of 2,665 jobs over the coming decade due to these delays with a cost of $275 million incurred by Adani. The company’s losses include external expert costs – primarily the legal and consulting costs related to Land Court, internal staff costs, holding costs for maintaining a workforce during the delay, and redesign costs.

In addition, an extra year of delays would lead to a further $1.3 billion GSP cost loss and an added $53 million to the company.

Adani has been facing several environmental legal battles with the approval of Carmichael coal mine. It had a series of stop-start issues based on its environmental and conservation plans.

It’s most recent halt, which it soon won, came after the Environmental Defenders Office Queensland (EDO QLD) filed a motion to stop work due to inconsistencies in its environmental protections for native animals, including the Ornamental snake and the Yakka skink.

The EDO has since filed another motion on behalf of community group Coast and County to review the lawfulness of the project.


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