Formerly known as Adani Abbot Point Terminal, North Queensland Export Terminal (NQXT) is Australia’s northernmost coal port, located in the Great Barrier Reef World Heritage Area.
This site is published by Market Forces.
At the time of original publication, the official NQXT website did not include the words “coal” or “Adani”, despite it being exclusively a coal port,
fully owned and operated by the Adani family and Adani Group (since we pointed this out it now officially admits it is a coal port).
This site sets out some information they forgot to include on the NQXT website.
NQXT only handles coal and is the port via which the thermal coal from the controversial Adani Carmichael coal mine will be exported. This means NQXT is playing a critical role in the Adani Carmichael coal project, which is likely to open up the Galilee basin to more climate-wrecking thermal coal mines. [1]https://www.abc.net.au/news/2019-06-12/adani-approval-could-be-galilee-basin-ice-breaker/11194510
Lifetime emissions associated with the mine have been estimated at 4.6 billion tonnes of CO2,[2]http://envlaw.com.au/wp-content/uploads/carmichael14.pdf equivalent to over eight years of Australia’s annual greenhouse gas emissions. It has also been estimated that burning all the coal from six proposed Galilee Basin mines would produce 24 gigatonnes of CO2 emissions (GtCO2),[3]http://priceofoil.org/content/uploads/2016/09/OCI_the_skys_limit_2016_FINAL_2.pdf equivalent to almost 6% of the remaining global carbon budget for the Paris Agreement’s 1.5°C goal.[4]https://www.ipcc.ch/sr15/chapter/spm/
Coal pollution from NQXT in the Caley Valley Wetlands after Cyclone Debbie in 2017.
Any finance for, or investment in, NQXT can be considered support for Adani’s Carmichael project. Investors, banks, and insurance companies looking to avoid the reputation risk of being associated with a massive new thermal coal project, must avoid involvement with NQXT.
What NQXT does
NQXT, 25km north of Bowen in Queensland, Australia, is a deep water coal terminal situated among ecologically significant wetlands, sacred sites of the Juru Traditional Owners and the Great Barrier Reef World Heritage Area. It is Australia’s most northern coal port, with a capacity of 50 million tonnes per annum (mtpa).
According to Fitch Ratings, NQXT handles approximately 60% metallurgical coal and 40% thermal coal.[5]https://www.fitchratings.com/research/infrastructure-project-finance/fitch-revises-outlook-on-north-queensland-export-terminal-to-negative-affirms-at-bb-20-09-2021 The share of thermal coal is likely to increase as production from the Carmichael mine ramps up and is shipped from NQXT. NQXT has signed a contract with Bravus Mining and Resources (formerly Adani Mining, fully owned by Adani Enterprises) for export of 9.3 million tonnes of thermal coal from the Adani Carmichael coal mine from July 2022, with a smaller contract starting from August 2021.[6]https://www.fitchratings.com/research/infrastructure-project-finance/fitch-revises-outlook-on-north-queensland-export-terminal-to-negative-affirms-at-bb-20-09-2021 NQXT is looking to expand and has government approvals to increase its coal export capacity from 50 mtpa to 60 mtpa.[7]https://www.abc.net.au/news/2018-10-11/adani-granted-20-per-cent-boost-to-abbot-point-coal-exports/10361454
Being the only port via which Carmichael thermal coal will be exported, NQXT is playing a critical role in Adani Group’s new mine and the opening up of the Galilee Basin. NQXT is part of the Carmichael project infrastructure and as such, any financing of NQXT can be viewed as supporting the Carmichael project.
Credit: Greenpeace / Tom Jefferson
Community and Environment
As mentioned above, NQXT is part of the Adani Carmichael project, one of the most socially and environmentally contentious fossil fuel projects in the world.
Adani Group does not have the Free, Prior and Informed Consent of the Traditional Owners of the Carmichael mine site, the Wangan and Jagalingou people,[8]https://standing-our-ground.org/ who continue to oppose the mine. The Traditional Owners of the NQXT site, the Juru people, have also raised concerns. In 2018 the Federal Court ruled proper processes had not been followed in conducting cultural heritage surveys at the NQXT site.[9]https://www.theguardian.com/australia-news/2018/jun/22/indigenous-group-hid-more-than-2m-in-payments-from-adani-mining-giant Despite the concern of Juru elders that cultural sites, including rock art and burial sites, were threatened by Adani’s then proposed rail line and port expansion, Adani said it was prepared to start work without their consent.[10]https://www.theguardian.com/environment/2018/jul/07/adani-says-it-could-start-works-at-abbot-point-without-traditional-owners-input
In addition, a significant majority of Australians are opposed to the mine. A national opinion poll in 2018 found 65% of respondents either opposed or strongly opposed the Carmichael mine.[11]https://www.smh.com.au/politics/federal/big-surge-in-opposition-to-adani-new-polling-reveals-20180131-p4yz4o.html This project faces continued community opposition, which has not let up for close to a decade. Over 100 major companies have now committed to refusing any work for the Carmichael mine and associated rail and port infrastructure.[12]https://www.marketforces.org.au/info/key-issues/theadanilist/#whos-out
The Adani Carmichael coal project is linked to a drop in aquifer levels, putting sacred sites in the region at risk.[13]https://www.theguardian.com/business/2021/jul/08/drop-in-aquifer-levels-near-adani-mine-sparks-concern-for-sacred-wetlands It will increase industrialisation in the already distressed Great Barrier Reef World Heritage Area.[14]https://www.bbc.com/news/world-australia-54533971 Most significantly, lifetime emissions associated with the mine have been estimated at 4.6 billion tonnes of CO2,[15]http://envlaw.com.au/wp-content/uploads/carmichael14.pdf equivalent to over eight years of Australia’s annual greenhouse gas emissions, fuelling more frequent or intense bushfires, storms, floods and drought.
NQXT has been fined twice, in 2017[16]https://www.theguardian.com/business/2017/aug/11/adani-fined-for-dumping-coal-laden-stormwater-into-sea-at-abbott-point and 2019[17]https://www.brisbanetimes.com.au/national/queensland/adani-fined-after-stormwater-flows-into-north-queensland-wetlands-20190326-p517m2.html, for releasing contaminated water into the surrounding ocean and Caley Valley wetlands.
Traditional owners on Country at the Carmichael site. Credit: Leah Light Photography
#StopAdani volunteers in Sydney. Credit: #StopAdani
A coal spill from Adani’s NQXT into Caley Valley wetlands, February 2019. Credit: Australian Conservation Foundation
Coral bleaching at Heron Island Feb 2016. Credit: The Ocean Agency / XL Catlin Seaview Survey / Richard Vevers
“After review, BNY Mellon has decided to resign from all legacy transactions with Adani in Australia and will not pursue additional transactions with Adani in Australia. BNY Mellon has determined this business is not aligned with our ESG [environmental, social and governance] principles.”
– BNY Mellon statement, November 2021
Financiers cutting ties
The Queensland Government sold NQXT to Adani Group in 2011 for A$1.8 billion (in the form of a 99 year lease).[18]https://www.infrastructureinvestor.com/adani-wins-abbot-point-coal-terminal-for-a1-8bn/ This purchase appears to have been entirely debt funded.[19]https://ieefa.org/ieefa-australia-escalating-financial-risk-adanis-abbot-point-coal-terminal/ NQXT has had some difficulty refinancing its debt, as more and more financiers cut ties due to their reluctance to be associated with the Carmichael coal mine.[20]https://www.marketforces.org.au/adani-faces-debt-bill-as-abbot-point-refinancing-fails/ A bond issue planned for early 2020 was cancelled and the company had to repay $270 million for two debt tranches[21]https://www.marketforces.org.au/adani_fails_finance_aapt/ due in 2020 using Adani’s own funds.[22]https://www.afr.com/companies/mining/coal-s-price-collapse-threatens-australian-mines-20200507-p54qyv
A group of Korean creditors which provided funds in 2018 and 2019 have now pledged no further investment in Adani’s coal port, and will cut all ties once their existing debts mature. These were Samsung Securities[23]https://www.theguardian.com/business/2020/jul/17/samsung-securities-pledges-no-further-financial-backing-for-adani-coal-after-protest, Hanwha Investment and Securities[24]https://www.theguardian.com/business/2020/aug/03/adani-second-major-korean-brokerage-withdraws-financial-backing-for-miners-coal-projects, Korea Investment and Securities[25]https://twitter.com/AvalonStop/status/1299234983043723265, Industrial Bank of Korea[26]https://www.samoaobserver.ws/category/samoa/69641 and Mirae Asset Daewoo[27]https://www.marketforces.org.au/info/key-issues/theadanilist/#whos-out.
Longstanding security trustee Bank of New York Mellon resigned from its role in November 2021[28]https://www.theguardian.com/business/2021/nov/05/us-bank-bny-mellon-cuts-ties-with-adanis-carmichael-coalmine and bond arrangers Investec[29]https://www.afr.com/companies/financial-services/investec-ditches-adani-over-climate-change-20200618-p553ze and CLSA[30]https://www.afr.com/companies/mining/asian-lenders-shun-adani-s-abbot-point-terminal-20200803-p55i4r have pledged not to work with NQXT again.
Ownership and operation
NQXT links the Carmichael project to the broader Adani Group and Adani family via its ownership structure and operation. As mentioned above, money to repay NQXT’s debt maturing in 2020 came from internal Adani sources.[31]https://www.afr.com/companies/mining/asian-lenders-shun-adani-s-abbot-point-terminal-20200803-p55i4r Another significant tranche of debt is maturing in December 2022,[32]https://inqld.com.au/business/2021/08/03/moodys-paints-bleak-picture-over-adanis-us500m-debt-mountain/ with the source of funds to settle this debt as yet unknown. This means any funding for Adani entities risks supporting NQXT and the Carmichael thermal coal mine.
There are two key Adani companies involved with NQXT. NQXT Port Pty Ltd owns the 99 year lease for the port and Abbot Point Operations Pty Ltd operates the port day to day.
According to the Australian Securities and Investments Commission (ASIC) company extract, as of December 2021 the port is co-owned by Adani Ports and Special Economic Zone (Adani Ports) and Singapore-based Abbot Point Port Holdings PTE LTD. Reports from 2017 show that Abbot Point Port Holdings is owned by Cayman Islands-based Adani family company Atulya Resources, which is itself owned by a British Virgin Islands-owned company.[33]https://www.abc.net.au/news/2017-10-02/adanis-tax-haven-ties-to-british-virgin-islands-revealed/9007714
In 2016 Adani Ports purchased Abbot Point Operations Pty Ltd,[34]https://economictimes.indiatimes.com/industry/transportation/shipping-/-transport/adani-ports-agrees-to-buy-abbot-point-bulkcoal/articleshow/54432226.cms the company operating NQXT, from Glencore. According to the ASIC, as of December 2021 Adani Ports remains the sole owner of this operating entity.
Screenshot of part of ASIC company extract for NQXT Port Pty Ltd, showing ownership structure, accessed 1 December 2021. The information may have changed since that date. Current information is available from the ASIC website.
Screenshot of part of ASIC company extract for Abbot Point Operations Pty Ltd, showing ownership structure, accessed 1 December 2021. The information may have changed since that date. Current information is available from the ASIC website.
Because NQXT is an essential link in the chain that forms the Adani Carmichael coal export project, any financing of NQXT can be considered as support for the Carmichael project. Investors, banks and insurance companies who don’t want to risk their reputation by supporting a massive new thermal coal project in the midst of the climate crisis, must avoid any involvement with NQXT.
References