Adani mine must stand on its own two feet, Labor's Jason Clare says

Paul Karp
A subsidised loan for the coalmine’s rail line isn’t ‘make or break’ for Adani, Jason Clare says. Photograph: Mead Gruver/AP

Adani should not receive a $900m concessional loan for a rail line from its proposed Carmichael mine because the company claims the project is commercially viable without taxpayer funds, Jason Clare has said.

Speaking on Radio National on Wednesday, the shadow resources and northern Australia minister said it would be “terrific” if the project went ahead and created jobs but it should “stand on its own two feet”.

The comments come after Malcolm Turnbull met the mining magnate Gautam Adani on his visit to India, explaining that the loan would need to be independently assessed but assuring him that native title issues would not stop the $16bn project.

On Tuesday the Nationals leader, Barnaby Joyce, said the proposed $900m loan from the Northern Australia Infrastructure Facility was a “tipping point” issue for Adani, defending the subsidised loan for a railway line from the mine to the port.

Clare said Joyce was wrong on the point of whether the loan was necessary for the project to proceed.

Adani has said this funding is not critical, they’d love to have … a concessional loan from the commonwealth paid by taxpayers, but they’ve said that it’s not make or break.”

He noted that one of the rules of the infrastructure fund was that it can “only provide funding if a project unlikely to go ahead without it” and the rail line therefore did not meet the requirements.

Clare argued that although Turnbull had said the proposal would be “assessed scrupulously and independently”, Joyce was essentially “directing the board to fund it”.

Asked if federal Labor was increasingly isolated on the issue, he said he could understand why Queensland Labor and unions including the Australian Workers’ Union wanted to develop the north but questioned whether spending 20% of the NAIF’s $5bn on one project was the best use of funds.

Clare said if Adani spent billions on the project it could also fund the rail line, as BHP Billiton, Rio Tinto and Fortescue had done for rail lines in the Pilbara.

Asked about Joyce’s comments the loan would open up the Galilee basin as a precinct and could be used by other miners, Clare said this was “new information” and suggested the government was pushing Adani and the NAIF to make the proposed rail line multi-use, although the company had asked for exclusive access.

Clare acknowledged the need to create jobs in northern Australia, explicitly linking unemployment to the rise of One Nation, saying the party received up to 30% of the vote in some areas “because people are struggling”.

He said coal would be part of the energy mix “for decades to come”, as China and India now get 70% of their electricity from coal and the figure would still be 50% by the middle of the century.

It was important “to make that coal used for electricity as low emissions as possible”, noting that Adani would source coal from elsewhere if not from the Carmichael mine.

Asked about Turnbull’s comments that native title would not impede the mine, Clare said the issue of 120 Indigenous land use agreements being thrown into uncertainty by a federal court decision was “not about Adani”.

Clare said Labor was keen to work with the government to “fix the problem created by this court case”, but criticised the attorney general, George Brandis, for additions to the bill that the government had not consulted Indigenous groups about.

The Coalition has already drafted legislation to bypass the native title decision, which Labor says it supports in principle.

Greenpeace has argued the Carmichael mine does not meet the requirements of the infrastructure fund because it is not “of public benefit”, may not be able to repay the loan, and Adani has said it does not need the funds.

The Australian Conservation Foundation cited legal advice by the Environmental Justice Australia that the mine may not qualify because of financial risks from climate change.

“The Adani coalmine will fuel the global warming that is making the reef sick, threaten 70,000 tourism jobs that rely on it, and divert urgent investment from renewable energy,” said ACF’s president, Geoff Cousins.

“If NAIF board directors burn $1bn of public money on coal infrastructure that will help destroy the reef and jobs, then absolutely they should be held to account.”

By using Yahoo you agree that Yahoo and partners may use Cookies for personalisation and other purposes