Tag Archives: Galilee Basin

Gina’s web

January 4, 2015
Written by: Kaye Lee
70 Replies

In 2011, as reported by Graham Readfern at Crikey, Gina Rinehart held a lunch at her house by the Swan River in Perth, at which West Australian Premier Colin Barnett, WA environment minister Bill Marmion and Chinese Ambassador Chen Yuming were in attendance to hear a presentation on climate change from the “sceptic” Professor Ian Plimer.

Plimer must have done well because, according to disclosures made to the Australians Securities and Investments Commission, Professor Plimer was appointed to the boards of Gina’s companies Roy Hill Holdings and Queensland Coal Investments on January 25 2012.

Dinner guest Environment Minister Bill Marmion’s chief of staff is Colin Edwardes, the husband of Cheryl Edwardes, who is the head of “external affairs, government relations and approvals” at Hancock Prospecting. Cheryl is also a former WA environment minister.

As PerthNow pointed out, Marmion was in the position of considering environmental approvals for Hancock Prospecting projects – of which there were four pending.

Let me just emphasise this. The WA environment minister’s chief of staff’s wife is employed by Gina Rinehart to secure government approval for her mining ventures.

And of course it doesn’t stop there.

Even considering the Coalition’s self-confessed penchant for doing business at weddings at the taxpayers’ expense, three senior members of the Coalition travelling all the way to India to a wedding of someone they have never met, at the behest of someone who was not related to the couple and whose own family says is an untrustworthy person motivated by greed, should have rung alarm bells far greater than the thousands the politicians subsequently claimed in “study” expenses for the jaunt.

At the time of inviting the politicians to the wedding, Mrs Rinehart was about to clinch a $1 billion coal deal with the bride’s grandfather – G.V. Krishna Reddy, the founder of GVK, one of India’s largest energy and infrastructure companies.

Three months after the politicians joined Mrs Rinehart at the Indian wedding the GVK conglomerate bought a majority stake in the billionaire’s ”Alpha” coalmine in Queensland’s Galilee Basin for $US1.26 billion.

When Barnaby Joyce decided to run against Tony Windsor for the seat of New England, Gina Rinehart contributed $50,000 directly to his campaign though some reports had the contribution at $700,000.

When Gina turned up to his election victory party, Barnaby said “Gina is a great friend and I’m a good mate of Gina’s and she’s got an Australian company which employs Australian people which pays tax in this nation and I’m so proud,” he said. “We need lots of Gina Rineharts, not one, [because] when we have a nation of lots of them we’re going to be a stronger nation.”

Barnaby Joyce hugged Gina Rinehart and told the waiting media he is proud to call her his “mate”.

“When we have someone like Gina, who is an Australian who actually is so different from other companies who are actually not Australian, then we should be proud of them [and] we shouldn’t kick them around,” he said.

“We should also be prepared to stand next to our mates because I’m a person who believes the Australian mateship quality is alive and well.”

And Gina stands by her man.

In November she flew to Canberra in her private jet to watch Barnaby’s inaugural speech in the House of Representatives which she viewed from the gallery as a “special guest”.

Some of Mrs Rinehart’s closest political friends, the Speaker Bronwyn Bishop and Liberal Party senators Cory Bernardi and Michaelia Cash, were invited to join the billionaire for an intimate gathering on the night before.

But getting back to the Alpha coalmine and the Indian connection…

A panel of independent scientific experts had raised concerns about groundwater, particularly the ability of Adani Group to model and monitor groundwater flows. In approving the mine, minister Hunt said he had accounted for the concerns.

In April last year the Queensland Land Court, following a challenge by communities, said the Alpha mine should only proceed if the development meets further conditions on water use.

The court’s recommendations are not binding, and what happens next now rests with the Queensland government. In a statement, Acting Premier Jeff Seeney said: “We look forward to working with the project proponents to deliver jobs and economic benefits to Queenslanders.”

In all likelihood, the project will therefore get the go-ahead, subject to new conditions.

In September, the Mackay Conservation Group said the rail company Aurizon had walked away from an infrastructure plan it signed with GVK in 2013 that would see it build a 300km railway from proposed mines in the Galilee to port. The group said the deal was off the table after Aurizon failed to produce an Environmental Impact Statement for the project.

However it appears that, because the Queensland government has declared the area over which the rail lines will be built a State Development Area, it meant an EIS was no longer required to be submitted at this stage.

Aurizon said it welcomed this change in process as a positive for the “regulation of development of necessary infrastructure to service this important area.”

A spokesman from GVK also confirmed the company is firmly committed to finalising its JV proposal with Aurizon.

The deal means Aurizon will take a 51 per cent share in Hancock Coal Infrastructure, which houses GVK Hancock’s rail and port projects.

The open-access infrastructure will service GVK Hancock’s Alpha, Alpha West and Kevin’s Corner coal projects in the Galilee Basin.

“This proposed transaction will provide development certainty for the rail and port projects and de-risks the Alpha Coal Project from a logistics point of view,” the spokesman said.

“The transaction will also provide a pathway for sufficient equity and debt funding for the rail and port projects to reach financial close.”

In November, Queensland Premier Campbell Newman announced that in addition to the open-ended royalty holiday already on offer to the first mover in the Galilee Basin, the state government was willing to invest hundreds of millions of taxpayer dollars to fund the associated rail and port projects.

Mr Seeney said the funding for the project would come from the asset leasing project the government will institute should it win the next election.

A spokesman for Clive Palmer said, “On one hand this government wants to sell assets and now they want to invest in helping one company.”

In December, GVK Hancock said it is focused on finalising approvals for its Alpha coal project in the Galilee Basin before looking to finance the $10 billion project. The comments came after French bank Societe Generale suspended its finance partnership with the project. Citing the project’s lengthy delays, the bank said it no longer had involvement in a financing deal.

But GVK Hancock said it did not require the bank’s services at this point in the project timeline.

“The key focus for our projects at this point in time is finalising our approvals and addressing litigious challenges to our attained approvals. Once we have finalised approvals we will then execute coal off-take agreements and work to finalise financing arrangements.”

Wall Street’s biggest banks are following the lead of UK and German financial institutions, and ruling out financing projects threatening Australia’s Great Barrier Reef. Three of the largest investment banks in the world – Citigroup, Goldman Sachs and JP Morgan Chase – have ruled out any investments in Queensland’s Abbot Point coal port. The news follows Deutsche Bank, Royal Bank of Scotland, HSBC and Barclays publicly ruling out investments in the coal port, leaving the Adani Group and GVK, who are seeking $26.5 billion to expand coal exports, dwindling options for finance. Australia’s ‘big four’ banks are now under pressure to join their US and EU counterparts.

Considering financiers, economists, and environmentalists are all questioning the viability of the project, it was somewhat surprising when, during Indian prime minister Narendra Modi’s maiden visit to Australia in November, Adani signed a MOU with the State Bank of India (SBI) for a $1 billion loan to fund the project in Queensland’s Galilee Basin.

Indian opposition MP Derek O’Brien raised the issue in the upper house of India’s parliament.

“Our understanding is these banks refused the loan, so our serious concern is why a $1 billion loan was given by SBI, knowing full well that these five banks have refused,” he said.

India’s coal minister said in October he hoped to stop imports of thermal coal within three years as domestic production stepped up.

“Two thirds of the produce of Carmichael will be imported back into India, so one of them is not talking the truth, speaking the truth. Because if India wants to reduce imports and two thirds of the capacity from the Australian mine is going to be imported back into India, it just doesn’t add up,” Mr O’Brien said.

Concerns have also been raised over prime minister Modi’s ties to Adani, the company behind the mine.

Over the past decade, Adani has prospered in the state of Gujurat, where Mr Modi was chief minister.

The company’s share price almost doubled as it became apparent Mr Modi would win the May election in a landslide.

Mr O’Brien said there were clear links between Mr Modi’s Hindu Bharatiya Janata Party and the Adani group.

“There is enough to suggest there is a cosy understanding and that is why this loan was approved, not taking into consideration the facts which were on the table,” Mr O’Brien said.

The company’s debt has risen substantially in recent years, much of it short-term debt.

Public interest lawyer Prashant Bhushan said recovering the loan may not be easy.

“When they can only recover it from the assets of Adani, but you see we don’t know. The total loans outstanding from the Adani group are in billions of dollars to various banks,” Mr Bhushan said.

Indian tweeters bemoaned Modi’s support for the Carmichael mine, calling it a repayment for billionaire friend, supporter and chairman of the Adani Group Gautam Adani, who accompanied Modi on his trip to Australia (and has apparently joined five of the PM’s six recent overseas jaunts).

It appears the coal barons have the governments caught in their web and we could well end up with a very expensive taxpayer funded railway to nowhere and the environmental consequences of dredging a port for a product that is no longer economically or environmentally viable to produce.

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Standing up for coal – Abbott and Newman give investment advice

November 16, 2014
Written by: Kaye Lee
35 Replies

Tony Abbott has told a G20 leaders’ discussion on energy he was “standing up for coal” as the Queensland government prepares to unveil new infrastructure spending to help the development of Australia’s largest coal mine.

Abbott, who recently said coal was “good for humanity”, also endorsed the mine, proposed by the Indian company Adani, to the meeting.

The Australian government has given all environmental and regulatory clearances for the $7.5 billion coal mining, rail and port project, said Gautam Adani, chairman, Adani Group, in an interview to The Indian Express.

And Campbell Newman is happy to put your money where his mouth is.

“We are prepared to invest in core, common-user infrastructure,” Mr Newman said. “The role of government is to make targeted investments to get something going and exit in a few years’ time.”

Despite poor market conditions, high costs and the massive outpouring of concern over the environmental impacts of their projects, Indian companies GVK and Adani remain hell-bent on opening up the Galilee Basin in Queensland. The smallest mine is as large as Australia’s biggest operating coal mine and the largest, twice the size. All of the proposals in the Galilee Basin would produce enough coal to chew up 7% of the world’s remaining carbon budget, drastically reducing our chances of keeping a lid on global warming.

Adani and fellow Indian company GVK are pushing their projects and Adani wants to start construction early next year, but the key problem is access to funds.

Few banks are willing to lend when coal prices are so low and the industry is facing issues with climate change.

There are also issues with both companies.

Adani Mining Pty Ltd borrowed $516 million from another subsidiary of the Adani Group, Adani Minerals, at an interest rate of 4.25%. Adani Enterprises, the parent group, borrowed from the banks 2 per cent more cheaply that it charges Adani Mining the subsidiary in Australia for internal loans.

Why would these loans be priced so far above commercial rates? Potentially they could rack up losses in Australia and rip out equivalent profits to India. Some $10 million a year thereby transferred – 2 per cent on $516 million – tax free to the subcontinent. Rupert would be proud.

Adani Mining P/L had no revenue and booked a pre-tax loss of $112 million in 2013-14. It spent $75 million on exploration and evaluation of the mining area, which was capitalised, along with $41 million of interest, into the balance sheet rather than expensed against the profit and loss.

Adani Mining’s red ink of $112 million mostly relates to currency losses. All loans are in US dollars with no hedging, giving rise to a loss every time the Australian dollar declines

The total investment so far by the Adani group in Adani Mining is now $984 million and shareholder equity is negative to the tune of $45 million which reflects net borrowings of $1.015 billion in this Australian subsidiary alone.

So we have a company with $1 billion in debt, negative shareholders funds, zero revenue and high cash burn with $15 billion still to spend, and the parent company, Adani Enterprises, has debts of $US12 billion.

Tim Buckley, director at the Institute of Energy Economics and Financial Analysis, puts it bluntly: “This project is not commercially viable.” Apart from the financial deficiencies of the main participants, he says thermal coal is in structural rather than cyclical decline.

In another red flag, Linc Energy accepted $155 million from Adani a couple of months ago for its option in the project. It is worth asking why Linc boss Peter Bond would sell a royalty of $2 billion over 20 years – perhaps worth $600 million today – for just $155 million.

And then there’s GVK.

Despite claiming to be a “leading global infrastructure owner, manager and operator” GVKPIL has no experience operating any business outside of India. It has never successfully built and operated a coal mine – in India or otherwise. GVKPIL has not operated any business in Australia, let alone a US$10bn greenfield project in the face of massive environmental, operational, logistical and financial challenges.

GVKPIL is currently committed to 16 greenfield infrastructure projects across six different asset classes. Many are behind schedule and / or over budget.

With a market equity capitalisation of only US$243m, GVKPIL is carrying on-balance sheet net debt of US$2.8bn. It’s share price is at an all time low and has underperformed the Indian index by 80% since 2010.

Building Australia’s largest black thermal coal mine in the untapped Galilee Basin would challenge experienced operators, but the combination of an inexperienced developer, slack demand globally for thermal coal and a deteriorating cost of production scenario in Australia moves the project beyond speculative.

Gina Rinehart’s Hancock Prospecting sold a majority stake in two Galilee coal prospects – Kevin’s Corner and Alpha – to GVK in 2011 under a deal believed to include a $1.3 billion upfront payment and a requirement for a $1 billion payment later on. However, the latter payment is still unresolved more than three years on, with Hancock Prospecting listing the unpaid amount at $656 million in its 2013 financial accounts. Apparently they can’t afford to pay.

That asset was written down to nothing in Hancock Prospecting’s 2014 financial accounts, which were published by the Australian Securities and Investments Commission on Friday.

“The carrying amounts of the financial assets relating to a coal transaction with GVK … is based on the ability of the purchaser, GVK, to complete the outstanding transaction conditions, which includes the payment of substantial amounts,” the company wrote. “Management believes it is increasingly unlikely that these accounts will be received from GVK.”

According to The Institute for Energy Economics and Financial Analysis, GVK‘s Alpha project appears likely to remain “stranded in the valley of death.”

Six of the top ten and nine of the top twenty coal funding banks have now stated that they don’t plan to fund the expansion of Abbot Point. Given the global scale and Australian focus of Galilee Basin projects, the Big Four banks in Australia (Commonwealth Bank, Westpac, ANZ Bank and National Australia Bank) will be critically important to the financing of this multi-billion work.

So far, the banks have been coy about saying anything about the proposals to expand coal exports through the Great Barrier Reef, falling back on sustainability policies that have, in recent years, seen them lend nearly $20 billion to fossil fuels. It has created an absurd situation where banks headquartered in Paris, London, and New York are doing more to stand up and defend the Reef than Australian banks.

It is already costing the banks. Several thousand customers have so far joined the rapidly growing divestment movement, moving to other banks in protest of the big four’s massive lending to the fossil fuel industry. And thousands more, worth hundreds of millions of dollars, sit in waiting, ready to shift their business based on whether the Australian banks will stand up and defend the Reef or fund its demise.

Rather than taking investment advice from Abbott and Newman, it’s time for us all to let our banks know what we Australians want.

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Gina’s Bollycoal (Ad)venture

January 5, 2014
Written by: Kaye Lee
24 Replies

When Julie Bishop, Barnaby Joyce and Teresa Gambaro collectively claimed more than $12,000 in “overseas study” allowances to pay for flights home from a wedding they attended in India in June 2011 as Gina Rinehart’s guests, the public were rightly outraged.

Public sector governance expert Stephen Bartos said that the legitimacy of the trip would “depend whether there’s any real conflict of interest. It’s a little bit different for backbenchers. If Julie Bishop or Barnaby Joyce aspire to be ministers one day, then the question is, is there anything involved with this that might come back to haunt them? If there was any possibility that this would be a deal that would require regulatory approval by the parliament that would be a problem,” citing the recent nixed ASX takeover that required legislative changes.

Under intense pressure from the media, the politicians agreed to repay the money (or some of it anyway), so everything should be tickety poo. Or is it?

Mrs Rinehart was about to clinch a $1 billion coal deal with the bride’s grandfather – G.V. Krishna Reddy, the founder of GVK, an Indian energy and infrastructure company.

GV Krishna Reddy first came to Australia looking for fuel for his power project in India. He switched tracks when he saw an opportunity in the huge, unconstrained mines available here.

Three months after the wedding, he paid Hancock Prospecting, one of Australia’s biggest resource companies, $1.3 billion for Alpha, Kevin’s Corner and Alpha West. His plan is to transform GVK from a middling Indian infrastructure player, struggling with debt and cash flow problems, to a mining major by 2025, which will produce 84 million tonnes of coal a year. To put the number in perspective, India’s total thermal coal imports in 2012 were about 100 million tonnes.

During 2011-12 Reddy travelled to Australia 27 times.

In India, GVK’s operational as well as financial performance has been deteriorating. Singapore’s Changi Airport Group pulled out of a joint deal in 2012, and constraints on gas supplies and a high interest burden have complicated matters. Its gas-based power projects are facing serious supply constraints and all its operating power projects are operating at alarmingly low levels of load factors.

After the deal with Rinehart had been signed, the economic environment got worse, coal prices fell from a peak of $120/tonne to about $90, funding dried up, and Reddy was unable to complete the financial closure as planned. In June 2012, when the Australian Federal government halted environmental clearances for GVK’s proposed coal mine in Queensland’s Galilee Basin, it became almost impossible to get investors interested. In January last year it was reported that Reddy needed to raise debt of about $7 billion to achieve financial closure.

Forbes India pointed out the importance of Reddy’s personal connection with Rinehart.

“But mining industry insiders say GVK is lucky to have one of the toughest Aussie voices on its side: Gina Rinehart, owner of Hancock and the world’s richest woman on the Forbes global billionaire’s list. Rinehart is one of Australia’s biggest climate sceptics, a vociferous opponent of carbon taxes, and has lobbied for allowing foreign labour in Australian mining. The reticent heiress has developed a great relationship with the Reddy family and has made at least six trips to India last year.”

Under a subheading of “Reinventing the rules”, Forbes goes on to say

“Reddy’s biggest challenge is to overhaul the bloated cost structure that has made Australia among the most expensive places to mine in. Customers are turning to cheaper supplies from Indonesia and elsewhere.

Trying to turn his inexperience into an advantage, Reddy is now questioning every convention and every assumption of Australian miners.

For starters, he has set a clear target: His team has to aim for a price of $50/tonne (freight on board). [Current production costs are about $70/tonne and rail contracts about $8-10/tonne]

Reddy hired McKinsey to help attack the cost culture within the Australian mining industry.

“The kind of equipment you order can make all the difference,” he says. His communication to the Australian team, led by group managing director and CEO Paul Mulder, is clear: “‘Good enough’ is what you need, not ‘best available in the world’.”

Bringing the Australians around to GVK’s way of working was a gradual process, says Reddy.

Reddy says it is silly to look at such a project with “today’s eyeglass”; you have to look at it for the long term. He admits it was touch-and-go till recently. But with environmental clearances in place, it is only a question of taking key strategic calls, he says. Over the next 50 years, the opportunity is enormous in a country with very low political risks.”

In June 2013, Times of India reported that

“Infrastructure firm GVK’s $10-billion Alpha coalmine, port and rail project is uneconomical and represents an unacceptable level of risk to potential investors, says a report by the US-based Institute for Energy Economics and Financial Analysis (IEEFA).

Titled ‘Stranded: A financial analysis of GVK’s proposed Alpha Coal Project in Australia’s Galilee Basin’, the report comes as Australian rail operator Aurizon negotiates to partner with the Indian conglomerate on the construction of the rail and port components of the Alpha project at a cost of $6 billion.

Commenting on the risk profile of the project, former first deputy comptroller of New York and the report’s co-author, IEEFA’s Tom Sanzillo, labelled GVK, “a weak investment partner” and the Alpha project “a quagmire, not an investment”.

GVK is seeking to raise a total of $10 billion capital to build Australia’s largest black coal mine in Queensland’s remote, untapped Galilee Basin, construct 500km of rail infrastructure across agricultural land and floodplains to the coast, and develop a highly controversial coal export terminal through the iconic, UNESCO World Heritage-listed Great Barrier Reef.

The IEEFA report emphasized that GVK has never successfully built or operated a coalmine or any business outside of India. It is overcommitted, with 16 greenfield infrastructure projects worth $20 billion across six asset classes.

Besides being highly overleveraged, carrying debt of $2.8 billion with a market capitalization of only $243 million, GVK faces a plummeting stock price, which has underperformed the Indian share price index by 80% since 2010, said the report.”

Despite concerns expressed by water scientists, on November 1 2013, Greg Hunt approved the 37,380 hectare Kevin’s Corner. The mine, to be operated by a joint India-Australia consortium, GVK-Hancock, is the first to be approved since the introduction of a new water trigger rule by the previous federal government.

Greenpeace claims Kevin’s Corner will use more than nine billion litres of water a year and the Lock the Gate Alliance says more information on its impact on Galilee Basin groundwater is needed.

In December Mr Hunt gave the go-ahead for three million cubic metres of dredge spoil to be dumped offshore in the Great Barrier Marine Park, 24km northeast off Abbot Point.

He also approved construction of the Adani-owned terminal 0 at Abbot Point and gave the go-ahead for the Arrow LNG facility on Curtis Island, near Gladstone, and its associated gas transmission pipeline.

Whislt it seems it full steam ahead here (ignoring the small matter of money), Mr Reddy’s other ventures don’t appear to be going so well. On December 10 2013 the Economic Times interviewed Gaurang Shah, Vice President of Geojit BNP Paribas Financial Services, about GVK Power.

“ET Now: It is a single digit stock but it has got some key assets to itself GVK Power, Bombay Airport, Bangalore Airport, some fairly decent road assets as well but of course the mountain of debt crippling it. What would you do with the GVK Power – would you buy it at the current levels?

Gaurang Shah: Absolutely not and these assets howsoever good they are, they get invisible when you look at the mountain of debt as you rightly put it on the company’s balance sheet. Time and again we hear certain news flows as to company is trying to reduce their debt on the balance sheet by getting away or selling out these assets, of course good assets. So, I do not see any reason why I should go ahead and buy a GVK Power or a GMR Infra or a Lanco Infra as a matter of fact and if you do see rallies these are perfect opportunities to off load these stocks if you have it in your portfolio.”

In October 2013, an investigation into illegal mining operations in India was suddenly halted. The investigation had been set up by the government and led to the arrest of public officials for corruption, but was wound up without explanation.

Commencing in 2010, the commission had a mandate to investigate financial transactions between exporters, traders and mining lease owners, as well as illegal practices like mining without a licence or outside lease areas. U. V. Singh, the commission’s primary investigator, said:

“The government has not stated any reason for instructing us to end our investigations. A full inquiry was not possible.”

However, the information gathered so far revealed high levels of corruption in the industry: so much that two former Congress chief ministers of Goa, Digambar Kamat and Pratapsingh Rane, have been indicted for involvement in illegal mining, as well as failure to safeguard the environment.

Vijay Pratap, convener of the think tank South Asian Dialogues on Ecological Democracy, said:

“The commission was exposing too much corruption at government level and risked undermining tightly woven corporate collusion with the political class, which has sadly become endemic in the mining industry. This is why the government aborted the investigation.”

According to Madhu Sarin, honorary fellow of Rights and Resources Initiative, the government’s decision to end the investigation proves a failure to protect vulnerable tribal communities.

“The commission’s termination will have a direct impact on the rights of all those illegally displaced already and under threat of displacement in the future due to non-recognition of their forest rights and being denied the right to decide whether mining in their ecologically fragile homelands should be permitted or not.”

With the increasing interest and investment by foreign mining companies in Australia, some of whom are under real pressure to make money fast, I would suggest it is not a good time to be removing regulations and oversight.

The role of government versus the role of our government

December 15, 2013
Written by: Kaye Lee
19 Replies

Image courtesy of smh.com.au

I recently read an article titled ‘The Responsibilities of Government’ and, whilst I did not agree with everything the author said, a few things really struck a chord with me.

“The government of a democracy is accountable to the people. It must fulfil its end of the social contract. And, in a practical sense, government must be accountable because of the severe consequences that may result from its failure. As the outcomes of fighting unjust wars and inadequately responding to critical threats such as global warming illustrate, great power implies great responsibility.”

The veil of secrecy surrounding this government protects them from their duty of accountability. The blue books advising the incoming government were withheld. Operational and intelligence matters will not be discussed. Crucial trade negotiations regarding the Trans-Pacific Partnership agreement (TPP) are kept secret. Ministers are kept away from the media and all interviews must be approved by the Star Chamber. The media are denied access to our on and offshore detention centres, and now the Salvation Army are to be removed as well. The first sitting of Parliament was delayed, debate has been gagged, and the Mid-year Economic and Fiscal Outlook (MYEFO) report was not presented before Parliament rose.

Public servants are sacked and reviews are outsourced to the private sector, or consultants are engaged, all of whom seem to have a connection with the Liberal Party and/or big business. They are given little time to review or consult, restricted frames of reference, and unrepresentative panels. Much of what they have been asked to review has already been the subject of recent review, or a review is already underway by government bodies like the Productivity Commission. It seems that these people are being paid a lot of money to give the answers the government wants to hear.

The response to the “critical threat” of climate change has been to undo the action already taken in pricing carbon, to disband all climate change advisory bodies, to decimate the CSIRO, and to refuse to co-operate in international initiatives to deal with this global threat.

Instead we have hastened to approve the biggest coal mines in Australia and the port expansion and railways to support them. Two proposed coal mines in the region could be responsible for an estimated 3.7bn tonnes of carbon dioxide emissions over their lifetimes. Greenpeace estimates if all the Galilee Basin mines hit their maximum potential, 705 million tonnes of CO2 will be released each year. For comparison, Australia’s current annual emissions are in the order of 400 million tonnes.

“The coal to be mined from the Galilee basin and exported through Abbot Point each year which will create more CO2 emissions a year than produced by both Denmark and Portugal combined.”

One of the three terminals was proposed by the Indian resource giant Adani, the second by a joint venture between the Indian company GVK and Gina Rinehart’s Hancock Coal, and the third site was to be developed by BHP Billiton. But BHP recently pulled out of its involvement in the project.

Even though port developers Adani note in their environmental impact statement, submitted to the government, “The current developments (proposed and approved) for port expansion will facilitate the export of coal, the combustion of which is recognised as a significant contributor to greenhouse gases and the global effects of climate change”, climate change was not mentioned in the approval documentation.

Adani was not required to assess downstream effects of the coal passing through its port because, it said, two Federal Court cases over previous, unrelated projects, found that it wouldn’t be necessary. They were only required to report on how port operations may interact with climate change. In order to mitigate the effects of port operation on climate change, Adani proposes that it powers up with renewable energy:

“Adani recognises that measures to reduce [greenhouse gas] (GHG) emissions through energy efficiency and the use of renewable energy technologies or low emissions materials make good business sense. Consequently Adani will commit to reducing GHG emissions through its procurement and operations practices.”

Aside from the irony of a coal port being powered by renewable energy, the ultimate ramifications of the coal being unlocked has not been considered by either the developer or the government in the approval process.

Hunt has also approved the Arrow LNG facility on nearby Curtis Island, as well as its associated transmission pipeline.

This year Unesco’s World Heritage Centre warned that the Great Barrier Reef, which has lost half of its coral cover in the past 30 years, would be placed on its “in-danger” list if there were major new port developments. A study commissioned by the previous Labor government found that dredging spoil dumped at sea travelled further than previously thought, potentially endangering coral and other marine life. The approval documents show the spoil from the dredging will be dumped within the Great Barrier Reef marine park area.

On Monday the Coalition passed changes to the Environment Protection and Biodiversity Conservation Act to strip away any repercussions if the government fails to consider expert advice before approving major developments such as mines and ports, removing the ability for community groups to legally challenge new developments if the environment minister failed to consult approved advice, thus removing the protection that the judicial system could have offered.

Which leads me to the second quote about the responsibilities of government.

“The central purpose of government in a democracy is to be the role model for, and protector of, equality and freedom and our associated human rights. For the first, government leaders are social servants, since through completing their specific responsibilities they serve society and the people. But above and beyond this they must set an ethical standard, for the people to emulate. For the second, the legal system and associated regulation are the basic means to such protection, along with the institutions of the military, for defense against foreign threats, and the police.”

Whilst we were quick to accede to America’s request to criticise China about a restricted flight zone, we condoned the human rights abuses in Sri Lanka and West Papua, and hesitated about action in Syria.

Social and income inequity is widening, exacerbated by this government’s preference for removing benefits from the poor whilst increasing them for the rich.

The vilification of Julia Gillard, the poor behaviour in question time in Parliament, and the rorting of MP’s entitlements, have hardly been ethical standards that the people should emulate.

The courts have been used to play politics as in the case of Peter Slipper, and to block equality laws like gay marriage, environmental laws have been changed, our military are being used to hunt down asylum seekers and our police are busily interrogating anyone caught riding a motor bike.

“Government economic responsibility is also linked to protection from the negative consequences of free markets. The government must defend us against unscrupulous merchants and employers, and the extreme class structure that results from their exploitation.

Governments argue that people need to be assisted with the economic competition that now dominates the world. But the real intent of this position is to justify helping corporate interests . . . siding against local workers, consumers and the environment.”

The lack of transparency, consultation, and discussion of possible consequences of our free trade agreements is of great concern. Allowing foreign corporations to dictate to us is a very dangerous path to follow. Instead of protecting us, the government are allowing big business to set the agenda in every area, and facilitating their every request with no thought to legal and social ramifications. There are a few aberrations to this general course. The failure to support Holden will cost many jobs and billions to the economy, and the failure to sell Graincorp has sent a message that we are closed for business.

“Another general role, related to the need for efficiency, is the organization of large-scale projects. It is for this benefit that we accept government involvement in the construction of society’s infrastructure, including roads, posts and telecommunications, and water, sewage and energy utilities. Further, giving government charge over these utilities guarantees that they remain in public hands, and solely dedicated to the common good. If such services are privatized, the owners have a selfish motivation, which could negatively affect the quality of the services.

That such assets should have public ownership is expressed in the idea of the “commons.” They should be owned by and shared between the members of the current population, and preserved for future generations.”

This government’s refusal to accept the necessity of a world class national broadband network (NBN) is baffling. The productivity benefits are huge, and the employment in the construction is significant. The refusal to fund public transport infrastructure is also very short-sighted.

We have already sold many of our valuable assets and the list being suggested for future privatisation seems to grow daily – schools, hospitals, Medibank Private, Australia Post, the ABC, HECS debts. Private businesses must make a profit and are not obliged to continue to provide unprofitable services. This can have dire repercussions for regional Australia, and for the variety of services that can be offered.

“Indeed, while we of course still need a means of defense, including against both external and internal (criminal) aggressors, it seems clear that our greatest need for protection is from other institutions and from the abuses of government itself, particularly its collusion with these other institutions. (Many of the needs that we now have for government are actually to solve the problems that it creates.)”

Who will protect us from this government?

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