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Adani Enterprises

Adani Enterprises
Based in India
Active in India, Australia
Targeted base metals, energy fuels

Adani Enterprises is a major Indian trading and commodities group, named as among "Asia's Fab 50" firms by Forbes magazine in September 2010, and then valued at over US$8 billion.

Founded by businessman Gautam Adani, in August 2010 it announced the "largest single investment by an Indian company in Australia" [MJ 6 August 2010; FT 3 August 2010] when it bought Linc Energy's Queensland coal licences, reported to embrace a resource of 7,800 million tonnes of coal, capable of eventually producing 60 million tons per year.

In May 2011, the firm (which according to the Mining Journal was "the largest importer of coal to India") expanded its presence in Queensland when it agreed to pay US2 billion for a 99-year lease of the 50 million tons-a-year Abbot Point coal terminal in the state [MJ 6 May 2011].

During 2010, India's environment minister, Jairem Ramesh, declared over a third of "coal blocks" (deposits) in the country to be "off limits" to mining. However, in early 2011, he gave in to the powerful Indian coal lobby, and reversed his earlier position.

As a result, in late July 2011, Adani Power, along with 19 other companies, including Jindal Power, and the Aditya Birla Group, was allowed to bid for a massive coal mine in Orissa, valued at around US$3.6 billion [Economic Times (India) 1 August 2011].

However, in early August that year, Adani Enterprises (along with three other companies) reportedly "went into a tailspin" after allegations (contained in a government report) that it had been guilty of unethical practices [PTI, 3 August 2011] in the state of Karnataka.

The Lokayukta report named no fewer than 400 firms and 787 people it claimed had been implicated in a "web of corruption involving mining, transport, customs and shipping officials, leading to hundreds of thousands of tonnes of iron ore going missing from mines across the state" [NesTrack (India) 3 August 2011).

In April 2013, Adani Enterprises announced it would begin extracting coal at a state-owned mine at Parsa-East Kante in the northeast of the country.

At the end of July 2013, according to India's Toxic Watch Alliance , villagers expressed their "strong opposition" at a public hearing to Adani's proposal to site a new ship-breaking facility near Mundra West Port in Gujarat’s Kutch district. They claimed that the project would "result in destruction of mangroves, leveling of sand dunes and adverse impacts on agriculture".

A government report was said to reveal that “the land for the project is being created by dumping dredge spoils...up to 7.0m above the chart datum”, while the ships would be "scrapped directly on the beaches or the vast inter-tidal mudflats...The beaching method of the Indian sub-continent relies heavily on low labour cost, since it involves very little mechanisation.”

This beaching method - the one proposed by Adani - is, said Toxics Watch, "fatally flawed". The group added:

"It is clear that in a tactical and clever manner the company has taken environmental clearance for its various projects in the proposed region in installments by outwitting the regulatory agencies... This truncated approach...has led to massive ecological changes with adverse impacts” [Press Release, Toxics Watch Alliance, 30 July 2013].

In 2014, and from the start of 2015, however, Adani faced one of the most concerted oppositions to a coal project of any company in the word. Although it must have thought that it was "home and dry" with its Australian Carmichael mine, railway, and the essential expansion of the Abbot Point coal terminal to sell the black stuff overseas (not least to India) it truly came unstuck. To a lesser extent, so did Adani's Indian partner, GVK.

By the end of 2014, no fewer than eight internaiotnal banks had withdrawn financial backing for the port expansion - Citigroup, Goldman Sachs Group, JPMorgan Chase (JP Morgan Asset Management, Barclays, Deutsche Bank AG (DB). Royal Bank of Scotland (RBS), HSBC Investment Bank, and Credit Agricole (Calyon) [See:

A host of Australian environmental groups took up cudgels against the project, and the United Nations counselled against building new port facilities, since they posed a threat to the integrity of the Great Barrier Reef. ['See:].

In March 2015, Aboriginal communities also spoke out against the mine [See].

And, shortly afterwards, the State Bank of India refused to make a US$1 billion loan to Adani for "development" of the Carmichael mine, despite a deal struck between India's prime minister, Narendra Modi, and Australia's Tony Abbott in November the previous year [World Coal, April 2015]

As of May 2015, it seemed that the project - at least as originally conceived - might well and truly be "dead in the water".