German conglomerate Siemens AG will not pull out of a contract to help Adani Enterprises Ltd. develop the contentious preproduction-stage Carmichael coal mine in Queensland, Australia, amid protests from climate activists.

Adani awarded Siemens an €18 million contract in December 2019 to install signaling systems for the Carmichael rail line.

As bushfires continued to raze Australia, activists called on Siemens to drop the project. But Siemens President and CEO Joe Kaeser said that would be impossible. "There is practically no legally and economically responsible way to unwind the contract without neglecting fiduciary duties," Kaeser said in a Jan. 12 statement.

Kaeser said Siemens "should have been wiser" about the project, but the company must stick to its commitments.

While noting that Carmichael went through a strict permitting process, Kaeser said Siemens has the right to terminate the contract if Adani violates its environmental obligations.

Kaeser also reiterated Siemens' pledge to be carbon-neutral by 2030 and said the company will establish a sustainability committee, which will have the power to stop projects that could have a negative impact on the environment.