Adani Coal Project: Cost-Benefit Analysis and Environmental Impact

The report aims to present the proposal of Adani Coal project considering the cost and the benefit and different final aspects involved in the case. It has been found that Adani Coal mine will lead to different consequences, which are discussed in report. The analysis shows that it will work as revenue for Australia but on the same side, it will not be beneficial for the people who are leaving in Australia due to high environmental issues.

Financial Reporting
9 / 1 8 / 2 0 1 9

Financial reporting
1
Executive summary
The report aims to present the proposal of Adani Coal project considering the cost and the
benefit and different final aspects involved in the case. It has been found that Adani Coal mine
will lead to different consequences, which are discussed in report. The analysis shows that it will
work as revenue for Australia but on the same side, it will not be beneficial for the people who
are leaving in Australia due to high environmental issues. The government will be able to
improve the financial, economic, and other development in Australia. However, the impact on
the environment will not give an agreement on this project. Also, the project leads to an impact
on the environment, Great Barrier Reef, land, Aboriginal people, and many others. However, this
proposal will lead to a rise in the Indian market for companies and need of people will be
achieved.

Financial reporting
2
Contents
Introduction.....................................................................................................................................3
Revenue streams..............................................................................................................................4
Conflict of interest.......................................................................................................................4
Australian government extinguish native title for the Adani coal mine..........................................5
Light of the environmental impact statement on project.................................................................6
Contribution of Adani Coal in different aspects..............................................................................7
Contribution to carbon emissions................................................................................................7
Impact on Aboriginal people.......................................................................................................7
Impact of water pollution on the Great Barrier Reef...................................................................8
India’s appetite for energy grows....................................................................................................8
Conclusion and recommendations.................................................................................................10
References......................................................................................................................................11

Financial reporting
3
Introduction
The report aims to propose the Adani Coal project being the financial accounting student. In the
current environment, Adani Coal is putting efforts to form the coal mine that is considered as the
largest mine in the world. This project is majorly a set to form the power for 100 million people
in the market of India. The project has been stuck in conservationist and the traditional owners of
the land. The report involves the revenue streams that will be received from the State and Federal
Government with the approval of the project. Further, the discussion is related to the steps that
the government should take such as extinguish native title, environmental impact statement, and
others. The impact of the Adani Coal has been considered towards the aboriginal people, Great
Barrier Reef, carbon emission and many others. The project will lead to the benefits for the
companies who are working in the Indian market as they get the source of energy.

Financial reporting
4
Revenue streams
If the Adani Coal mine project gets approved then the major revenue stream for the company is
that they will be able to find the investment from Adani that is approx. $21 billion in the field of
mining, rail and port infrastructure which leads to the rise in the jobs and economy (Australian
Resource & Energy group, 2017). One of the revenue streams of Australia State and Federal
government is when they provide the approval of water and mining as this requires a license for
which the Adani will pay the bulk amount. It is expected that the licence fee for the water is
approx. $18.5m. Along with this, the tax will be payable by Adani that works as the revenue for
the government if the projects are approved.
The federal government will find the revenue from the investment in infrastructure by Adani.
The 400-km rail line would get a link to Carmichael coalmine in Queensland's Galilee Basin to
the port at Abbot Point, north of Bowen town. Along with this, Adani Company will sign 74
million dollar landmark deal with the steel group of Australia to purchase steel. The company
will also provide the jobs to around 10,000 people with broad opportunities for the small and
medium businesses that will contribute to improve the economy of the country (Sengupta,
Williams and Chandrasekhar, 2019). The supply of the energy to the people in India will provide
the revenue to the Adani group, which will allow the State and Federal government to attain the
revenue from the people.
Conflict of interest
The approval of the Coalmine might lead to the conflict of interest among the income streams of
the government and safeguarding the environment for the future generation. The coal mine

Financial reporting
5
approval might lead to the high consequence on the environment that is not accepted by the
people who protect their environment due to which they might go against the government who
actually approved for the deal for their benefits in terms of income that they were supposed to
get from the Adam Coal mine (First Post, 2017).
Australian government extinguish native title for the Adani coal mine
The government should not extinguish the native title. The land is the symbol of traditional as
well as ancestor’s land that is the only identity of the people. The aboriginal people are not
willing to give their land for the Adani Coal Mine because they know that this will lead to the
destruction of their land. Adani will clean the entire land and also destroy it for their benefit and
lead to a rise in environmental issues (Doherty, 2019).
Further, the decision, which will by the government, might affect the native people in Australia
because they might extinguish the native title for the revenue. The people will say that
government calling to rule out transfer of their land and this lead to the argument that they had
never given their consent for Adani to occupy their country. It will give power to Adani that has
engaged the police of Queensland as well as threatened them (Doherty, 2019). However, it has
been found the government should also think about the environmental consequences that are
faced by the company. The damage towards the environment is more due to which the
government should think first before making the decision. As per my views, the government
should not allocate extinguish native title for the Adani coalmine. This will contribute in
conserving the environment effectively, which is essential for Australia. However, the
government can try to convince the Aboriginal people for giving their land irrespective by taking
anything in return of this. In addition to this, the revenue that is attained by the government will

Financial reporting
6
make them extinguish the right of the native people (Robertson, 2019). The extinguish people are
less in numbers and government is not getting benefit out of that land due to which they don’t
want to continue with it and might be for the profit they will extinguish native title.
Light of the environmental impact statement on the project
The approval of the Adani coal project will make the company dump the sediment from the
Black coal on the doorstep of the Great Barrier Reef. This shows that the environment including
the exploitation of water resources and also the wetland animals and plants who resides in the
Great Barrier Reef. Considering the fact, there will be no permission to continue with the project
majorly in light of the environmental impact statement. The environmental impact statement
majorly works to reduce the actions that lead to an impact on the environment (Reside, Mappin,
Watson, Chapman and Kearney, 2016). The coalmine project leads to an impact on the water
resources and underwent a full assessment of the environment. The impact of the carbon
emission will affect the environment, which not affect the atmosphere but also improve the
consequences of the issues related to the health of people within the area. The approvals of
coalmine will also affect the land of Aboriginal people, which are exploited in terms of the entire
resources, and the nearby land and other areas get affected (Slezak, 2018). Also, the setting of
certain parameters for the Adani coal company related to their impact on the environment will
safeguard the environment if the proposal is accepted by the government of Australia. The
government and company can take the proper initiatives to safeguard their environment and its
resources.

Financial reporting
7
Contribution of Adani Coal in different aspects
Contribution to carbon emissions
Coal from the Adani’s proposed $16 billion Carmichael project will lead to the annual emission
that is similar to those from the countries like Austria and Malaysia. The research shows that
Adanu Carmichael mine will significantly contribute to improve the contribution to the
international emission of carbon. The mining and burning of Coal from this project are likely to
create a predicted 4.7 billion tonnes of the greenhouse gas emission (Taylor, 2015). This will be
more than 0.5% of the residual worldwide carbon budget for preventive threatening to 2oC. The
predicted average emission of annual of approx. 79 million tons of the carbon that is equal to the
project of Adani comparable to emission from different countries that include Malaysia and
SriLanka.
Impact on Aboriginal people
The Adani group also leads to the impact on the aboriginal people, Wangan and Jagalingou
peoples who are traditional owners of land in the area of Queensland Galile Basin (Wangan and
Jagalingou, 2019). The impact is that the land of these people is taken by the Adani group, which
is their ancestral that affects them emotionally. This includes the 28,000 hectares of land on
which the mine would produce 60 million tonnes every year. The people believe that they lose
their rights, native title, ancestral lands and waters. Thus, the owners have to leave their land and
they do not be able to avail the benefit out of their land that is the reason behind their livelihood.
Impact of water pollution on the Great Barrier Reef
The project of Adani leads to an impact on water that affects the Greef Barrier Reef that is one of
the ecological support systems of the country (Horn. 2018). Considering the water population

Financial reporting
8
due to high chemicals, the government need to take the required step for the survival of the Great
Barrier Reef. The water pollution limit has been exceeded by Adani by 800% at the Abbot Point
Coal Terminal that affects the Great Barrier Reef. The company has released the releasing highly
polluted, coal-laden water that has affected the wetlands that are essential for the natural
occurrence (Australian Marine Conservation Society, 2019). The major split water loaded with
coal dust and the remaining particles that affect the water, the source for some animals that
further affects their health (Australian Marine Conservation Society, 2019). The project is alone
lead to the rise to 520 ships travelling through Great Barrier Reef each year which lead to the rise
in the level of risk that affects the oil spills, chemical spills and other incidents in Reef.
India’s appetite for energy grows
The approval of the project will contribute in improving India's appetite for the energy that
improves and its ability to meet the demand for the energy from the domestic sources that are
majorly faced by the Indian companies to look abroad to meet their requirements. The flow of
the energy in India will be possible with the approval of the project of Adani Coal in Australia.
The approval will lead to a rise in the operations of the related field which include agribusiness,
real estate, defence and many others that will help the Indian government to contribute to their
economy.
India will be able to meet the needs of companies towards the energy for their operations that
contribute to the growth and development of the country. The supply of energy will allow the
company to meet the growing demand of people not only within the domestic but also in the
international market. This approval will bring vast changes in the operations of India and there
will be an improvement in the lives of people. A maximum number of people will get the

Financial reporting
9
employment for conducting the operations that will reduce the poverty and make India a better
place for the companies who want to make their investment in the Indian market (Economic
Times, 2019). Thus, this will make the Indian market financial strong and they will be able to
make a strong decision.

Financial reporting
10
Conclusion and recommendations
In the end, it can be concluded that the proposal of the project shows that the Australian
government will be able to get a high amount from the project of Adani Coal. The revenue
streams are majorly the license amount that will be paid by Adani. Along with this, thee high
coal mine include the high taxes and other infrastructure investment which is beneficial as it is
revenue for the government. The light of the environmental statement shows that there will be a
major impact on the environment that might affect the resources of the country and affect future
generations. This report shows that the project will lead to carbon emission, affects the aboriginal
people, and pollutes the Great Barrier Reef. However, the Indian market will get the energy that
is one of the major benefits for the companies dealing in the Indian market. It is recommended
that government should think from the environmental point of view before making any decision
for this proposal. The revenue is high but environmental impact is also high. The government
can set certain environmental parameters if they approve the proposal.

Financial reporting
11
References
Australian Marine Conservation Society (2019) Adani fined for releasing polluted water into
wetlands [Online]. Available from: https://www.marineconservation.org.au/adani-fined-polluted-
water-caley-valley-wetlands/ [Accessed on 18th September 2019]
Australian Marine Conservation Society (2019) Stop Adani Wrecking Our Reef [Online].
Available from: http://www.marineconservation.org.au/stop-adani-wrecking-our-reef/ [Accessed
on 18th September 2019]
Australian Resource & Energy group (2017) Time To Fully Understand The Benefits Of Adani’s
Carmichael Project [Online]. Available from: https://www.amma.org.au/news-media/media-
center/time-fully-understand-benefits-adanis-carmichael-project/ [Accessed on 18th September
2019]
Doherty, B. (2019) Queensland extinguishes native title over Indigenous land to make way for
Adani coalmine [Online]. Available from:
https://www.theguardian.com/business/2019/aug/31/queensland-extinguishes-native-title-over-
indigenous-land-to-make-way-for-adani-coalmine [Accessed on 18th September 2019]
Economic Times (2019) Australia state says final approvals for Adani's coal mine to be decided
within three weeks [Online]. Available from:
https://economictimes.indiatimes.com/industry/indl-goods/svs/metals-mining/australia-state-
says-final-approvals-for-adanis-coal-mine-to-be-decided-within-three-weeks/articleshow/
69476768.cms?from=mdr [Accessed on 18th September 2019]

Financial reporting
12
First Post (2017) Adani gives final approval for $4 billion Carmichael coal mine, rail projects in
Australia [Online]. Available from: https://www.firstpost.com/business/adani-gives-final-
approval-for-4-billion-carmichael-coal-mine-rail-projects-in-australia-3521771.html [Accessed
on 18th September 2019]
Horn. A. (2018) Adani prosecuted over release of coal-laden water near Great Barrier Reef
[Online]. Available from: https://www.abc.net.au/news/2018-09-05/adani-prosecuted-over-
release-of-sediment-near-barrier-reef/10204374 [Accessed on 18th September 2019]
Reside, A., Mappin, B., Watson, J., Chapman, S. and Kearney, S. (2016) Four environmental
reasons why fast-tracking the Carmichael coal mine is a bad idea [Online]. Available from:
https://theconversation.com/four-environmental-reasons-why-fast-tracking-the-carmichael-coal-
mine-is-a-bad-idea-67449 [Accessed on 18th September 2019]
Robertson, J. (2019) What we know about Adani's Carmichael coal mine project [Online].
Available from: https://www.abc.net.au/news/2019-04-26/what-we-know-about-adanis-
carmichael-coal-mine-project/11049938 [Accessed on 18th September 2019]
Sengupta, S. Williams, J. and Chandrasekhar, A. (2019) How one billionaire could keep three
countries hooked on coal for decades [Online]. Available from:
https://economictimes.indiatimes.com/industry/indl-goods/svs/metals-mining/how-one-
billionaire-could-keep-three-countries-hooked-on-coal-for-decades/articleshow/70711634.cms?
from=mdr [Accessed on 18th September 2019]

Financial reporting
13
Slezak, M. (2018) Adani water project bypasses full environmental impact assessment against
advice [Online]. Available from: https://www.abc.net.au/news/2018-11-07/adani-water-project-
bypassed-full-assessment-against-advice/10457670 [Accessed on 18th September 2019]
Taylor, L. (2015) Coal from Carmichael mine 'will create more annual emissions than New
York' [Online]. Available from: https://www.theguardian.com/environment/2015/nov/12/coal-
from-carmichael-mine-will-create-more-annual-emissions-than-new-york [Accessed on 18th
September 2019]
Wangan and Jagalingou (2019) Stop Adani destroying our land and culture [Online]. Available
from: https://wanganjagalingou.com.au/our-fight/ [Accessed on 18th September 2019]