Australia is undergoing a large-scale expansion programme in its northern state of Queensland, the country’s largest economy. The government’s chief project is focused on developing the Port of Abbot Point, one of Australia’s most significant emerging bulk ports, located 25km north of Bowen.
The port, operated by Indian multinational conglomerate company Adani Group, is currently preparing for the construction of a new Terminal 0, which will be predominantly used to ship in thermal coal from Adani’s planned $16bn Carmichael mine, Australia’s biggest planned mining project.
The terminal expansion and new Carmichael mine will facilitate shipping coal from the Galilee Basin, considered to be one of the biggest untapped coal basins in the world.
The expansion plans, known as the Abbot Point Gateway Project, got the green light on 22 December 2015 from Federal Environment Minister Greg Hunt, after ardent opposition from both national and international environmental bodies, including the World Wildlife Fund (WWF), UNESCO, Mackay Conservation Group, advocacy organisation 350.org and the Great Barrier Reef Marine Park Authority (GBRMPA), among others.
Their common concern surrounds the proximity of the project to the Great Barrier Reef (GBR), the largest living structure on the planet and home to an estimated 1,500 species of fish and over 360 species of corals.
The reef is already facing immense pressure and narrowly avoided being “downgraded” by UNESCO in 2015 due to rapid degradation, with approximately 50% of its coral coverage having been lost in the past three decades.
Outcry from the international community pressured the Australian Government into setting up a set of strict environmental conditions which must be obeyed for the project to be approved. Despite their efforts however, opponents continue to fear extensive damage to the GBR.
The Abbot Point Gateway Project: building a new coal hub
The expansion at Queensland’s northern port takes place in preparation for what was expected to be millions of tonnes of coal going offshore. In its present form, Abbot Port spreads over 5,350 hectares and comprises rail in-loading facilities, coal handling and stockpiling areas, a single trestle jetty and conveyor connecting to two offshore berths and two shiploaders.
The project is anticipated by the Department of State Development to cost anywhere between $50-100m, with an exact figure to be established after the tendering process.
Central to the construction process is the capital dredging of approximately 1.1 million cubic metres in situ volume of previously undisturbed seabed, which will accommodate new berth pockets and ship apron areas required to support the development of Terminal 0.
The new terminal will more than double the port’s capacity, from the current 50 million mta to 120 million mta. The vast majority of this – 70 million mta – will be largely thermal coal, with an approximated value of between $6-7bn.
According to a list of lenders published by Market Forces, a campaign affiliated to Friends of the Earth, the State Bank of India invested the biggest sum to date, with $1.7bn, followed by the Commonwealth Bank with just over $1bn. Other investors included Standard Chartered, Westpac and ICICI Bank, to name a few.
The project was approved under a set of environmental conditions, which the Federal Government said were the toughest in Australia’s history.
Under the former Queensland Government’s plan, the dredged material was initially going to be dumped at sea, but a revision of the project settled the dredged material to be dumped on land instead. The ‘Conditions of Approval’ document also imposes a 97% reduction of dredge compared to the original proposal, along with 29 other conditions.
The environmental limitations are in tune with the Reef 2050 Long-Term Sustainability Plan, a commitment made by the Australian Government in order to avoid UNESCO removing the GBR from its protected heritage areas.
The Great Barrier Reef is under threat
Speaking on behalf of WWF following the project’s approval, spokesperson Louise Matthiesson said: “Although we’re pleased that the dredge spoil can no longer be dumped at sea, it’s not appropriate to place it beside an internationally significant wetland, when there are better locations available further inland.”
Similarly, environmental organisation Mackay Conservation Group states on its website: “If the proposed expansion of the Abbot Point coal port terminals goes ahead, Australia will be responsible for exporting massive amounts of greenhouse gas producing coal, and put at risk our much-loved Great Barrier Reef, and the turtles, fish, dugongs, whales, dolphins, coral and other species that depend on it.
“Such an outcome would not only risk a national ecological disaster, it could put at risk tens of thousands of jobs in the marine tourism industry in Queensland.”
At present, the GBR is an important asset not only to Australia, but to the world. Apart from serving as a habitat for a multitude of marine species, it also contributes to the employment of 69,000 people through tourism, recreation, fishing and research activities.
Direct expenditure on tourism and leisure activities surrounding the site amounts to a total of $6.9bn per year, according to Deloitte Access Economics.
Opening the government’s report on the reef’s current state of conservation, Hunt wrote: “The Great Barrier Reef remains the best managed marine ecosystem in the world.
“Through the projected $2 billion to be invested over the next decade and strong legislation, the Australian and Queensland governments are committed to the ongoing preservation of this natural wonder.”
However, the same report shows that 25 of the 41 elements which represent the general health and condition of the reef have been marked as “poor”. Compared to the reef’s original assessment in 1981, 61% of the elements making up the reef’s well-being have been in steep decline, with dwindling populations of seabirds, marine turtles and fish, as well as the deterioration of coral reef habitats and seagrass.
The WWF also included the GBR among the world’s heritage sites currently under threat by harmful industrial activities.
Furthermore, as former GBRMPA director Jon C. Day pointed out in an editorial in Australian publication The Conversation, the government’s latest environmental impact statement only limits “the disposal of ‘capital’ dredge spoil in the Marine Park”, leaving out “‘maintenance’ dredging which occurs periodically at most ports.”
“Nor does the proposed ban extend to port areas that are not part of the Marine Park,” Day writes. “It would only apply in the legislated Great Barrier Reef Marine Park, which is smaller than the World Heritage Area, and which includes port areas outside the park such as Townsville, Abbot Point, Mackay, Hay Point and Gladstone.”
Abbot Point expansion awaits final approval
Although the project looks like a sure bet, a number of conditions are yet to be met before dredging and construction works can start.
Recently, a financial hurdle arose when global rating agency Standard and Poor’s (S&P) revised Adani’s credit rating from “stable” to “negative” in May 2016. This came as bad news for the company and dampened the project’s prospects to a certain extent, as one of the key conditions for approval is to demonstrate that the project is commercially viable.
Meanwhile, Queensland’s tourism operators, who had previously kept quiet about the reef’s endangered status, finally broke their silence and joined the opposition debate in May, spelling out their worries about the site’s future. In an open letter, operators urged regional politicians to detract investment in Abbot Point’s expansion, as well as rule out any new coal mines.
Moving forward, the Queensland Government must issue a number of permits for operational works and material change of use for the Port of Abbot Point.
Furthermore, the Commonwealth Environment Minister must also approve a dredge material management plan, as well as an onshore environmental management plan ahead of the commencement of any construction activities.