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Adani to pay full royalties on Carmichael coal mine under new Queensland policy

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Adani to pay full royalties on Carmichael coal mine under new Queensland policy

Premier of Queensland, Australia, Annastacia Palaszczuk, said Adani Enterprises Ltd. will have to pay full royalties on its preproduction-stage US$16.5 billion Carmichael coal operation under a new policy unanimously agreed to by the state's cabinet for the development of the Galilee and Surat Basins and the North West Minerals Province, Bloomberg News reported May 26.

However, an unnamed source told the news outlet that the new policy will enable the Indian group to defer royalty payments, with the length of such deferment to be announced later.

The Australian Broadcasting Corp. said the royalties could be deferred only in the first few years of production, which Adani would later pay in full with interest.

The company recently deferred a final investment decision on the project, seeking more clarity on royalties from the Queensland government. The company was expected to make a final investment decision on the mine and rail project towards the end of this month, with plans to start construction in August.

Australian Resources Minister Matthew Canavan also recently flagged that Adani may not proceed with the project unless it can strike a deal with the Queensland government on royalties.

Adani posted a profit of 2.21 billion Indian rupees for the fourth quarter of its fiscal 2017.