I wonder if Liberal and Nationals MPs and senators remember that Adani's corporate structure in Australia is allegedly also geared towards siphoning money into tax havens?

The Guardian, 16 August 2017:

A global mining giant seeking public funds to develop one of the world’s largest coal mines in Australia has been accused of fraudulently siphoning hundreds of millions of dollars of borrowed money into overseas tax havens.

Indian conglomerate the Adani Group is expecting a legal decision in the “near future” in connection with allegations it inflated invoices for an electricity project in India to shift huge sums of money into offshore bank accounts.

Details of the alleged 15bn rupee (US$235m) fraud are contained in an Indian customs intelligence notice obtained by the Guardian, excerpts of which are published for the first time here.

The Directorate of Revenue Intelligence (DRI) file, compiled in 2014, maps out a complex money trail from India through South Korea and Dubai, and eventually to an offshore company in Mauritius allegedly controlled by Vinod Shantilal Adani, the older brother of the billionaire Adani Group chief executive, Gautam Adani.

Vinod Adani is the director of four companies proposing to build a railway line and expand a coal port attached to Queensland’s vast Carmichael mine project.

The proposed mine, which would be Australia’s largest, has been the source of years of intense controversy, legal challenges and protests over its possible environmental impact.

Expanding the coal port to accommodate the mine will require dredging an estimated 1.1m cubic metres of spoil near the Great Barrier Reef marine park. Coal from the mine will also produce annual emissions equivalent to those of Malaysia or Austria according to one study.

One of the few remaining hurdles for the Adani Group is to raise finance to build the mine as well as a railway line to transport coal from the site to a port at Abbot Point on the Queensland coast.

To finance the railway Adani hopes to persuade the Northern Australia Infrastructure Facility (Naif), an Australian government-backed investment fund, to loan the Adani Group or a related entity about US$700m (A$900m) in public money.

Adani family’s Australian corporate structure…..

ABC News, 14 March 2017:

Up to $3 billion from Adani's planned Carmichael coal mine will be shifted to a subsidiary owned in the Cayman Islands if the controversial project goes ahead, an analysis of company filings shows.

An "overarching royalty deed" gives a shell company rights to receive a $2-a-tonne payment, rising yearly by the inflation rate, beyond the first 400,000 tonnes mined in each production year for two decades.

The company with this entitlement is ultimately owned by Atulya Resources Limited, a secretive entity registered in the Cayman Islands, and controlled by the Adani family.

"In plain English, the upshot for the Adani family is [that] if the mine goes ahead, they receive a $2-a-tonne payment, so up to $3 billion, via a Cayman Islands company, a company owned in a tax haven," says Adam Walters, principal researcher and Energy Resource Insights.

With a production capacity of 60 million tonnes or more a year, that amounts to about $120 million per annum in payments, increasing each year in line with the CPI, potentially flowing offshore.

"I would describe it as a structure that means that the Adani family enriches themselves if the mine goes ahead but that other shareholders are impoverished," associate professor Thomas Clarke, director of the Centre for Corporate Governance at UTS told the ABC.

"The worry is that this may be just the beginning.

"That the Adani family have the ability to shift cash and assets around at will and in the future they may well do so at the cost of shareholders and the Queensland economy."

He said the billions flowing to the Adani private company would come at the expense of minority shareholders in the company listed on the Bombay stock exchange which ultimately owns the Carmichael mine.

How Adani acquired the right to this multi-billion-dollar revenue stream is a tale in itself.

In 2010, Adani Mining Pty Ltd bought the coal tenement that is set to become the Carmichael mine from the now defunct Linc Energy.

Part of the sale involved Adani Mining giving Linc Energy an "overriding royalty deed" which entitled it to receive $2-a-tonne for all coal mined beyond the first 400,000 tonnes in any production year.

Linc Energy informed investors at the time could be worth "over $120 million per annum" and up to $3 billion over the course of the royalty right.

But in August 2014, in dire financial straits, Linc Energy agreed to sell the royalty deed back to Adani at a fire sale price: just $150 million.

The obvious course would have been to extinguish the royalty deed, because it represented a multi-billion-dollar liability for the mine which is ultimately owned by Adani Enterprises Ltd, the Bombay-stock exchange listed company.

Instead, the royalty deed "was assigned by Linc Energy Limited to Carmichael Rail Network Pty Ltd as trustee for Carmichael Rail Network Trust," notes in financial reports of Adani Mining Pty Ltd say.

Carmichael Rail Network is one of a group of companies behind the proposed North Galilee Basin rail line, which Adani is currently seeking a subsidised loan of up to $1 billion from the Federal Government's Northern Australia Infrastructure Facility to build.

"What this means is that one of the companies currently seeking up to $1 billion in public subsidy is going to profit to the tune of up to $3 billion if the mine goes ahead," Mr Walters said.

Adani Mining Pty Ltd, the proponent of the Carmichael mine and the holder of its environmental approvals, appears to have lent Carmichael Rail the funds to buy the royalty deed.

BACKGROUND

The Guardian, 21 August 2015:

We know that Abbott loves coal and thinks that it is “good for humanity”. Is that why he is prepared to back a financially risky project?

Is it the “10,000” jobs that government ministers say will come from the project (remembering that Adani’s own consultant has said that those numbers were vastly overblown and that Carmichael would result in less less than 1500 jobs).

Could it be the prospect of cash from coal royalties? Maybe.

Does the substantial media coverage from the mine just give the Abbott Government another opportunity to tell the public that all environmentalists are economic saboteurs who want to take away people’s jobs and come in the dead of night to steal your babies? Possibly.

But could there be another causal factor that has contributed to the way Australian politicians have forcefully backed Adani for so many years?

Could that other factor be the close relationships that the company has managed to forge at the highest levels with Australia’s political leaders?

Whenever an Australian leader sets foot in India, it seems that a meeting with Gautam Adani is never more than a figurative (and sometimes literal) flight in a private jet away.

There’s evidence of this going back at least as far as October 2010 and its there in the records of trade missions tabled before parliaments.

Let’s peruse together.

In October 2010, Queensland’s then Premier Anna Bligh travelled to India on a trade mission to promote the state’s bid to host the Commonwealth Games and “strengthen Queensland’s position as an ally and destination for future trade and investment in the eyes of the Indian market and nation leaders”.

A report tabled to the Queensland Parliament shows that Bligh’s first official meeting with Indian figures was with Adani, where the company’s owner Gautam Adani and his international development executive Harsh Mishra got to quiz the Premier about policies relating to rail lines, underground coal gasification and support for mining in the Galilee Basin.

Bligh also “agreed to attend the opening” of Adani’s offices in Brisbane later that month and extended an invitation for Adani to meet with its co-ordinator general when they were next in Brisbane.

After Campbell Newman won power for the Liberal National Party in Queensland, he led a trade mission to India too.

While there, Newman joined former Labor Resources Minister Martin Ferguson and a 76-strong business delegation for a tour of an Adani port and a power plant, reportedly getting there on a private jet.

The report on the trade mission, tabled to Parliament, shows that Mr Adani then hosted a lavish reception at his home for the entire delegation.

Judging by one freelance photographer’s images, the event was quite an affair with much handshaking all-round.

The event was part of “OzFest” – Australia’s “largest cultural festival” for which Adani was a “platinum sponsor”

In 2013, the Queensland Government was again in India for a trade mission led by then Deputy Premier Jeff Seeney and, again, the Adani company was on hand.

Seeney’s delegation travelled with Adani executive Harsh Mishra to visit an Adani-owned port and power station before Seeney had a private lunch with the company.

Later that same day, Seeney met with Gujarat Chief Minister Narendra Modi (now the Indian Prime Minister) and… Gautum Adani.

Mr Adani then hosted a private dinner with Seeney “which included Adani Group senior executives and members of Mr Adani’s family”.

But it’s not only Queensland politicians who have sought out Adani company bosses while on missions to India.

Former New South Wales Premier Barry O’Farrell met with Gautam Adani during a trade visit to India in December 2013.

Current NSW Premier Mike Baird also went on a trade mission to India earlier this year. You can probably guess by now the name of one Indian billionaire he met with.

Gautam Adani is also a co-chair of the Australia-India CEO Forum – an initiative of the Australian High Commission.

Trade minister Andrew Robb attended the last meeting in New Delhi. I don’t know if they had dinner (but if I was a betting man….)

Left unchecked the gas & coal mining sectors will be the death of the Great Artesian Basin and what is left of the Great Barrier Reef

According to an August 2016 Report Commissioned By The Australian Government And Great Artesian Basin Jurisdictions Based On Advice From The Great Artesian Basin Coordinating Committee the Great Artesian Basin (GAB) is one of the largest underground freshwater reservoirs in the world. It underlies approximately 22% of Australia – occupying an area of over 1.7 million square kilometres beneath arid and semi-arid parts of Queensland, New South Wales, South Australia and the Northern Territory. Approximately 70% of the GAB lies within Queensland…..

The first people to make use of GAB water were Indigenous tribes for whom it was critical to survival. Indeed, there is evidence that the GAB sustained Aboriginal people for thousands of years prior to European settlement.

The natural springs of the GAB provided a critical source of fresh water, and supported valuable food sources including birds, mammals, reptiles, crustaceans and insects, creating an abundant hunting ground for local tribes. The plants and trees around the artesian springs were used for food, medicine, materials and shelter.

The springs provided semi-permanent oases in the desert and supported trade and travel routes which evolved around them. The springs also played a key part in the spiritual and cultural beliefs of Aboriginal people. Ceremonies and other events were held at spring wetland areas which remain precious cultural and sacred sites. Numerous Creation stories feature a connection to groundwater.

This underground freshwater reservoir holds 65,000 million megalitres much of which fell as rain 1 to 2 million years ago, but not all of this water is in accessible layers.

For assessment purposes the GAB is divided into four regions – Carpentaria, Central Eromanga, Western Eromanga and the Surat Basin.

In 1878 the first bore was sunk to draw water from the Great Artesian Basin.

In modern Australia its economic values are shared by towns, agriculture, cattle & sheep grazing and industry/mining across the four basin regions.

The Courier map based on a 22 August 2016 report

Economic output of groundwater dependent sectors in the Great Artesian Basin 

                                                                                                                                              

The report points out that Water has historically been extracted from the GAB at a greater rate than recharge and this creates a problem for 21st Century Australia.

Professor of Environmental Sciences Derek Eamus, University of Technology, 18 June 2015:

As the pressure in the GAB has declined and the water table drops, mound springs (where groundwater is pushed to the ground surface under pressure) have begun to dry up in South Australia and Queensland. Associated paperbark swamps and wetlands are also being lost and it gets more and more expensive to extract the groundwater for irrigation and other commercial applications.

On average, rates of groundwater extraction across Australia has increased by about 100 per cent between the early 1980s and the early 2000s, reflecting both the increased population size and commercial usage of groundwater stores.

Despite the strain on water resources, the gas and coal mining industries are allowed virtually unlimited water extraction from within the Great Artesian Basin and where the few limits are placed on extraction it is poorly policed by government agencies.

This is a graph of coal seam gas, conventional gas and petroleum industry water use 1995-2015:

Source:.DNRM 2016, p. 62.

The Adani Group’s most recent water licence for the Carmichael coal project issued in April 2017 allows it to take a virtually unlimited volume of groundwater each year for the next 60 years, plus surface water – with minimum oversight.

The Environmental Defender’s Office (Qld) states that: It is expected that Adani may require up to 9.5 billion litres of groundwater every year for the Carmichael project.

Poor management by Adani of its Abbot’s Point coal waste has already led to a smothering of the vibrant, nationally important Caley Wetlands with run-off via its estuarine system expected to reach adjacent waters of the Great Barrier Reef World Heritage Area.

Satellite image of Caley Wetlands after emergency water release by Adani - now covered in coal waste.

A picture of the Abbot Point coal loading facility showing coal water run-off moving north-west into the wetlands and coal dust on the beaches. The Age, 12 April 2017, Photo: Dean Sewell

Coal dust on the beaches next to the Abbot Point coal loading facility  Photo: Dean Sewell/Oculi

Great Barrier Reef Blog

On 10 March 2015 ABC News reported:

Hundreds of square kilometres of prime agricultural land in southeast Queensland are at risk from a cocktail of toxic chemicals and explosive gases, according to a secret State Government report.

A study commissioned by Queensland's environment department says an experimental plant operated by mining company Linc Energy at Chinchilla, west of Brisbane, is to blame and has already caused "irreversible" damage to strategic cropping land.

The department, which has launched a $6.5 million criminal prosecution of the company, alleges Linc is responsible for "gross interference" to the health and wellbeing of former workers at the plant as well as "serious environmental harm".

The 335-page experts' report, obtained by the ABC, has been disclosed to Linc but not to landholders.

It says gases released by Linc's activities at its underground coal gasification plant at Hopeland have caused the permanent acidification of the soil near the site.

Experts also found concentrations of hydrogen in the soil at explosive levels and abnormal amounts of methane, which they say is being artificially generated underground, over a wide area.

The region is a fertile part of the Western Darling Downs and is used to grow wheat, barley and cotton and for cattle grazing, with some organic producers.

Other documents, released to the ABC by the magistrate in charge of the criminal case, show four departmental investigators were hospitalised with suspected gas poisoning during soil testing at the site in March.

"My nausea lasted for several hours. I was also informed by the treating doctor that my blood tests showed elevated carbon monoxide levels (above what was normal)," one of the investigators said.

High levels of cancer-causing benzene were detected at the site afterwards.

On 9 February 2017 ABC News was still reporting on the contamination:

Flammable levels of hydrogen have been found at a number of locations near the site of a controversial gas project that has been blamed for contaminating huge swathes of prime Queensland farm land.

The ABC understands an ongoing Environment Department investigation has confirmed that the contamination is much more widespread than previously thought.

The Queensland Government has dispatched Environment Department officers to the Hopeland community, near Chinchilla in the state's south, and is setting up a call centre to help explain the situation to landholders…..

Due to fears about possible hydrogen explosions, the Government has been enforcing a 314-square kilometre "excavation caution zone" around the Linc plant, with landholders banned from digging any hole deeper than two metres.

The ABC understands further investigation by the Environment Department has now found flammable levels of hydrogen at locations outside the current caution zone.

The hydrogen has been detected underground and the department says it dissipates quickly in the open air.

Government sources have stressed the gas is not of an explosive concentration but landholders will be encouraged to exercise caution.

Left unchecked the mining industry will bring the Great Artesian Basin closer to collapse.

It is not as if either federal or state governments ever fully realise the supposed financial gains allowing this environmental degradation was supposed to bring to their treasuries.

In 2007-08 the Australian Taxation Office released taxation data which showed that 68.8 per cent of all mining companies on its books paid no tax in that financial year. In 2009-10 the percentage of mining companies paying no tax had risen to 73.1 per cent and in in 2010-11 the percentage of mining companies paying no tax was 72.2 per cent. By 2013-14 a total of 60 per cent of publicly listed energy and resources companies did not pay tax and again in 2014-15 60 per cent of all energy and resources companies paid no tax.

Add to this the fact that Adani in Australia in estimated to have paid only 0.008 percent in tax on their total income in 2014-2015 and is structured in such a way that its tax burden is artificially lowered and a significant proportion of its profits move offshore to the Cayman Islands tax haven.

It isn’t hard to see a pattern developing here.

Maximum environmental, cultural, social and economic risk for Australia with minimal financial return on risk.