Adani’s dig now, pay later deal – but Dick says ‘they will pay every dollar’

The Queensland Government has signed a deal with mining company Adani to defer payment of royalties on its Carmichael mine in central Queensland for an unspecified period of time.

Oct 02, 2020, updated Oct 02, 2020
Adani is understood to have secured a $1 billion loan from the Bank of India, which is now under scrutiny. (Photo: Adani)

Adani is understood to have secured a $1 billion loan from the Bank of India, which is now under scrutiny. (Photo: Adani)

Treasurer Cameron Dick revealed the Government had locked in a deal with Adani this week.

The deal with Adani is the second agreement reached in Queensland that allows a resources company to defer its royalties payments.

Dick said both when the company will start to pay royalties, and how much revenue the state would collect was commercial in confidence.

“But I can assure you that Adani will pay every dollar in royalties that they have to pay to the people of Queensland — with interest,” he said.

“That’s absolutely locked in now, and that is something that we’ve concluded as a government.

“These terms are consistent with the resources regional development framework that formed the basis of the agreement with the Century zinc mine last year.”

Dick said the deal set out how much the controversial $2 billion Carmichael mine is required to pump into the Queensland economy, once the mine is up and running.

The agreement is more than a year overdue, which the Treasurer said was the result of negotiating a good deal.

“We spend a lot of time negotiating royalty agreements, not just in relation to this mine, but in relation to many mining projects across Queensland,” he said.

In 2017, the ABC reported the Government had proposed a deal that would see Adani pay just $2 million a year in royalties once the project began operations, with the rate to increase after several years.

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The agreement was negotiated by the treasurer at the time, Curtis Pitt.

‘Dodgy secret deal’

The Carmichael project has approval to become one of the largest coal mines in Australia once fully operational.

Adani said the mine would produce between 10 and 15 million tonnes of thermal coal a year, with an option to increase production to 27 million tonnes a year.

Greens MP Michael Berkman called on Dick to reveal the terms of the royalty deferment.

“We’re in the middle of a historic recession and Queensland Labor are giving a multinational coal corporation a tax break with a royalties holiday,” Berkman said.

“Cameron Dick should reveal just how many millions of dollars will be cut out of the Queensland budget as a result of this dodgy, secret deal.”

– ABC / state political reporters Stephanie Zillman and Allyson Horn

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