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Adani terminates Carmichael coal mine contracts with Downer

Adani Enterprises Ltd. terminated contracts with Downer EDI for the development of the company's Carmichael coal project in Queensland, Australia, with mutual consent, The Australian Financial Review reported.

The company now plans to develop the mine on an "owner operator" model.

Adani hired Downer in December 2014 to undertake drilling, blasting and coal haulage at Carmichael, in a contract reportedly worth nearly A$2 billion.

The company noted that the scale of the project has been revised to a smaller footprint and the Downer contracts would be terminated after Queensland Premier Annastacia Palaszczuk vowed to block federal attempts to fund coal mine, rail and port project through the Northern Australia Infrastructure Facility, or NAIF.

"Following on from the NAIF veto last week and in line with its vision to achieve the lowest quartile cost of production by ensuring flexibility and efficiencies in the supply chain, Adani has decided to develop and operate the mine on an owner operator basis," Adani said.

Downer will continue to provide transitional assistance to the company until March 31, 2018.

The Indian miner, however, said that the contract termination was not a sign that the Carmichael project would soon be terminated as well, adding that it remains committed to developing the mine.

Adani has been struggling to secure funding for the development of the massive coal mine.