Quotes of the Week

“The Turnbull government is at war with the people. This is a government which hates their own constituents. The Liberal Party has lost touch with what it stands for and will be decimated unless it changes tack. Across the next electoral cycle the Liberals will lose power federally and in every state with the exception, perhaps, of Tasmania.”  [Former Liberal Party of Australia state director in Queensland & South Australia, Geoffrey Greene, quoted in The New Daily on 27 April 2017]

“We are a prosperous country with wretched revenue.” [David Marr on ABC TV The Insiders on 30 April 2017]

Just because it is beautiful...........(27)

Green Tree Python (Morelia viridis) 

non-venomous protected python species, forest dweller

found in Cape York Peninsula in Queensland, Australia.

Also found in New Guinea and various islands in Indonesia

Credit: Shannon Wild, Australian wildlife photographer

Pictures that tell 1,000 words

Pictures that tell 1000 words pic.twitter.com/Gy2olRH8Lz

— Laura Tingle (@latingle) April 26, 2017

 Left to right: Ivanka Trump, Managing Director International Monetary Fund Christine Lagarde, German Chancellor Angela Merkel caught by a photographer as Ms. Trump states that her father U.S. President Donald Trump has a long history of advocating on women's issues. 

Problems with tax collection from Australian resource and energy sector due to aggressive avoidance strategies

It would appear that successive federal and state governments have allowed the resource and energy sector to take Australia for everything except the gold fillings in its teeth……..

2 Office of the Chief Economist, Resources and Energy Quarterly, December 2016; Office of the Chief Economist, Resources and Energy Quarterly, December 2015; Office of the Chief Economist, Resources and Energy Quarterly, December 2014.

[Australian Taxation Office (ATO) 30 March 2017 submission to Senate Standing Committees on Economics, Inquiry into Corporate Tax Avoidance]

The Sydney Morning Herald, 29 April 2017:

Multinational gas companies will soon sell an annual $50 billion worth of Australian liquefied natural gas to foreign markets, but the nation will have to wait more than a decade for any revenue boost and some projects will never pay a cent in tax for the resources they extract.

A report prepared for the Turnbull government into the petroleum resource rent tax has confirmed fears, first revealed by Fairfax Media in 2015, that revenue from offshore gas will continue to flatline until at least 2027.

Despite that, Treasurer Scott Morrison insisted on Friday that Australians were not being shortchanged, but said the government would consider some changes to the system.

The review of the PRRT by former treasury official Mike Callaghan has acknowledged there are systemic problems and recommended changes to toughen the system for new LNG projects.

But, in a clear victory for the $200 billion industry, he shied away from urging any major changes for projects already past the investment stage, including Chevron's giant Gorgon and Wheatstone ventures and Shell's Prelude project.

The Callaghan report was released amid the political wrangling over east coast gas supply and on the same day the Senate inquiry into corporate tax avoidance grilled LNG bosses in Perth.

The Sydney Morning Herald, 26 April 2017:

Foreign-owned gas companies have legally avoided paying significant tax on billions in earnings from their Australian operations because of loopholes, according to a study. 

The loopholes have allowed the companies to write off interest payments for the borrowings of offshore subsidiaries, it has been claimed.

The study, by academic accountants at the University of Technology School of Accounting, and left-leaning campaign group GetUp, looked at the available balance sheet data of gas giants ExxonMobil and Chevron. It found the two companies have achieved colossal revenue flows from their Australian operations but paid little if anything in petroleum resource rent tax in recent years.

The practice is known as "debt loading" or "thin capitalisation".

Over the two years 2013-14 and 2014-15, Chevron earned more than $6.12 billion in revenue, but paid nothing in PRRT, according to the assessment.

It found ExxonMobil achieved revenue of almost three times that at $18.08 billion in the same period, but paid only $803.5 million.

The study concluded that between the operation of the company tax rules and the petroleum resource rent tax regime these enormous multinational resources companies can "load up" their balance sheets with excessive debt, thereby reducing taxable income to the point where the tax liability is low or non-existent.

The report, Investigation into the Petroleum Resource Rent Tax and Debt Loading in Australia – 2012 to 2016, found 95 per cent of oil and gas projects in Australia paid nothing in PRRT in 2014-15.

Australian Petroleum Production & Exploration Association (Appea) Ltd, Submission to the Review of Commonwealth Petroleum Resource Taxes, February 2017: 

APPEA does not consider a case exists for any changes to be made to the existing PRRT provisions.

Oil and gas corporation Santos Limited currently seeking to establish coal seam gas fields in NSW stated in a 3 February 2017 written submission to the current Senate inquiry into tax avoidance:

Santos has participated in a number of offshore and onshore oil and gas projects during the period of operation of PRRT, from 1 July 1986 (see attachment). Based on our experience with petroleum projects in which Santos has an interest it is our view that PRRT has operated as intended and that therefore the existing design features are appropriate…..

The declining revenues are a function of changes to the industry and currant commodity prices rather than changes or faults in the original design of PRRT.

Santos Limited with a total income of $3.38 billion in 2014-15 declared it had no taxable income in that financial year. The previous financial year its tax liability was $3.14 million on a declared taxable income of $27.34 million out of a total income before tax of $4.35 billion.

“The Adelaide-based Santos has long been accused of being a major contributor to the tight gas supply situation in eastern Australia due to the reliance of its Gladstone LNG project on third-party suppliers.”

BACKGROUND

The Australian, 25 August 2012:

SOME of Australia's biggest oil and gas players expect to pay little or no additional tax on their multi-billion-dollar onshore energy projects, putting federal government hopes of billions of dollars of additional revenue in doubt.

The admissions by Woodside Petroleum, Santos and Origin Energy indicate the government is unlikely to receive any significant additional funds in the foreseeable future from the expanded petroleum resources rent tax.

Parliament of Australia, Corporate Tax Avoidance:

On 2 October 2014 the Senate referred an inquiry into corporate tax avoidance to the Senate Economics References Committee for inquiry and report by the first sitting day in June 2015.

On 15 June 2015, the Senate granted an extension to the committee to report by 13 August 2015. On 12 August 2015, the Senate granted an extension to the committee to report by 30 November 2015. On 23 November 2015, the Committee was granted an extension to report by 26 February 2016. On 22 February 2016, the committee was granted an extension to report on 22 April 2016.

On 2 May 2016, the Senate granted the committee a further extension to report by 30 September 2016.  

The inquiry lapsed at the end of the 44th Parliament.

On 11 October 2016, the Senate agreed to the committee's recommendation that this inquiry be re-adopted in the 45th Parliament. The committee is to report by 30 September 2017……

On 1 December 2016, the committee resolved to broaden the scope of the inquiry to include Australia's offshore oil and gas industry.

The committee has asked to receive submissions on the treatment and/or payment of:

i. royalties;

ii. the Petroleum Resource Rent Tax (PRRT);

iii. deductions; and

iv. other taxes

by corporations involved in Australia's offshore oil and gas industry, including matters relating to the collection of these moneys by government.

University Of Technology Sydney, Ross McClure et al, Analysis of Tax Avoidance Strategies of Top Foreign Multinationals Operating in Australia: An Expose, 19 April 2016:

Multinational corporations are in a unique position to engage in tax aggressive strategies, as they are generally large in size and highly profitable, they exhibit low levels of debt in their capital structure, and have operations across national borders that generate foreign income streams. The overall group is made up of multiple entities across a number of tax jurisdictions and most multinational corporations have at least one subsidiary in a tax haven.

These characteristics have been associated with tax shelter activity in the U.S. (Wilson 2009) and with aggressive tax planning strategies such as abusive transfer pricing in Australia (Richardson et al. 2012). The information technology, pharmaceutical and energy sectors are both dominated by large multinational corporations and provide strong mechanisms that allow these corporations to divert profits away from where value and profits are created in order to reduce their tax liabilities.

News.com.au, 17 March 2017:

Gas on the east coast of Australia is controlled by a handful of companies and the lack of competition means they can charge higher prices locally.

At the moment, supply is controlled by six companies: Santos, Exxon, BHP, Origin, Arrow Energy and Shell. Some of these companies also control pipelines used to transport gas around the country, also adding to inflated prices……

He [energy analyst Bruce Robertson] said the global glut of gas, which is predicted to continue until 2030, has also put more pressure on companies to make money domestically.

The more they restrict supply locally, the more money they make.

It’s created the bizarre situation that sees Australian gas being sold in Japan for a wholesale price that is cheaper than the price it’s available for in Australia.

Santos, Shell and Origin Energy have to stick to long-term contracts they signed with Japan amid a global glut, but the lack of competition in Australia means they can restrict supply locally and drive up prices.

Australians are now paying a price higher than the international price for gas.

There’s even talk about Australia importing its own gas back because this would be cheaper.

Australia is also not profiting as much as we could from selling our gas overseas.

Japan reportedly puts a tax on the gas it imports from Australia, which will deliver it $2.9 billion over the next four years.

In comparison, Australia will not receive any money from its petroleum resource rent tax from gas projects over the same period. We get $0 in tax from selling our gas overseas.

Most of the $800 million we do get from the tax every year comes from established oil operations in the Bass Strait, rather than from LNG producers.

National Rural Health Alliance welcomes Labor commitment to National Rural Health Strategy and implementation

Medianet Release
26 Apr 2017 7:24 PM AEST - Welcome commitment to National Rural Health Strategy and implementation The National Rural Health Alliance today welcomed the commitment of the Federal Opposition to the development of a dedicated National Rural Heath Strategy and Implementation Plan. The commitment was made by Shadow Minister for Health Catherine King in the opening session of the 14th National Rural Health Conference, which started in Cairns today. Alliance Chair, Geri Malone, said today that the commitment by Ms King represented an important breakthrough for the seven million people who live in rural and remote Australia. "The Alliance has been encouraging broad, non-partisan support for a national strategy for rural and remote health and wellbeing," Ms Malone said. "For too long, Australia has been without an overarching strategy and implementation plan which is dedicated to bridging the health divide between the city and the bush. "There is overwhelming evidence which shows that where you live impacts on your health and wellbeing – that the further you are away from a capital city, the worse your health, and your access to services, tends to become. "But we are now in a rare period in decades of rural health planning and reform where we do not have a current National Rural Health Strategy, and that needs to change." Ms Malone said the first National Rural Health Strategy was released in 1994.   "There were various updates and revisions of the strategy over the ensuing years, with the last being the National Strategic Framework for Rural and Remote Health, endorsed by Health Ministers in November 2011.    "At the time, the Alliance called for a National Rural and Remote Health Plan to be developed to operationalise the goals set out in the Framework, but it never eventuated. "So the Framework has not been actioned in a consistent, comprehensive way, there are no national reports on progress against the Framework, and no action has been taken to update it." Ms Malone said the Alliance recognised the effort being put into health workforce programs, including for rural and remote Australia. "We also know workforce is only one part of a more complex equation about what's different and what needs to be done to fix the divide in health outcomes for rural Australia," she said. "We constantly seem to have to remind the non-believers in our cause, be that politicians and funders, metro centric decision makers and influencers, that firstly as 30 percent of the Australian population, we are entitled to equity in health service provision.  "This does not mean doing the same. One size does not fit all. We know there are many ways of achieving the same end result, but that requires adaptation and contextualization to make it work – contextualized to place, place-based and individualised care. "It is not an easy task and it can become somewhat disheartening to have to plead our case repeatedly.  "We therefore see a national rural health strategy and plan not as ends in themselves but rather they provide the framework within which policies should be developed, planned, implemented and measured. Distributed by AAP Medianet JN#:877826
	© Australian Associated Press, 2017

Is Pauline Hanson failing to fully comply with state and federal electoral laws - again?

It almost beggars belief. Is Pauline Hanson failing to fully comply with state and federal electoral laws – again?

ABC News PHOTO: Pauline Hanson stands in front of the plane that former One Nation members say Bill McNee funded. (Supplied: One Nation)

The Saturday Paper, 29 April-5 May 2017:

One Nation risks deregistration in Queensland following the failure of Pauline Hanson to advise the Electoral Commission of Queensland about a botched incorporation that has left it with a noncompliant constitution. The party secretly switched legal structures last November without telling members, using a draconian clause in its superseded governance rules that allowed One Nation state executive members to do whatever they chose without question. Former insiders have said a principal purpose for the incorporation was to put in place a corporate veil so the entity rather than members of the executive would be the subject of legal action.

The method of incorporation and the failure to consult is consistent with a trend of centralising all of One Nation’s power in Queensland, which has in the past been illustrated by attempts to close branches across the country through the use of proxies to forcibly remove “troublesome” state leaders, attempts to close bank accounts over which the One Nation national committee had no authority, and the initiation of complaints to police to intimidate a sub-branch in the Northern Territory.

At the same time, the party neglected to observe mandatory rules contained in Commonwealth and Queensland electoral laws, which must be included in its constitution for One Nation to be a political party with legal standing. Breaches of provisions that specify which clauses must appear for a constitution to be compliant under law are grounds for the cancellation of a party’s registration under Section 78 of Queensland’s Electoral Act.

Neither Senator Hanson nor the deputy registered officer – party treasurer and Hanson’s brother-in-law Greg Smith – informed the electoral commission of the changes in legal structure of the entity. There were two reporting deadlines missed by One Nation – notification of the changes should have been delivered seven days after December 31 and March 31. 

News of One Nation’s constitutional high jinks follows revelations over the past six months related to the party’s preselection and disendorsement processes during the West Australian election, questions about its compliance with goods and services tax legislation, and doubts about the donation and declaration of an aeroplane to Pauline Hanson for campaigning purposes.

It also follows a network-wide ban of the ABC, announced in a Facebook video posted by Hanson after the April 3 airing of a Four Corners report that highlighted a range of issues faced by One Nation. The program, criticised by Hanson and her colleagues as a media “stitch-up”, has resulted in a formal investigation by the Australian Electoral Commission, related to the donation of the two-seater plane.

Pauline Hanson’s One Nation is the business name of One Nation Queensland Division Incorporated, which was an unincorporated association since it registered on January 23, 2001. That changed last year when the entity was incorporated with the same ABN. 

The entity is regarded as the same for tax purposes and the name of the unincorporated body has transitioned into the incorporated form……

Crikey.com.au, 5 April 2017:

And that’s where the law comes in. The facts as we know them are that Ashby has a plane, in which he flies Hanson around the country on what is clearly One Nation business. Hanson herself has made numerous public statements, including on the party website, asserting that the plane belongs to One Nation. It is literally plastered with her name and face.

One Nation is a registered political party. The Commonwealth Electoral Act requires each party, and each of its state branches, to lodge an annual return with the Australian Electoral Commission, within 16 weeks after the end of each financial year. The annual return must include disclosure of all amounts received by, or on behalf of, the party from any single source totalling more than $13,000 (for the 2015-2016 year).

Donations are expressly defined as including the value of a gift. There is no room for doubt that, if a generous supporter gave an aeroplane to an official of the party, so that that official could fly the leader of the party around the countryside on party business, then the gift of the plane (or the cash to buy the plane, if that’s what happened) would be required to be disclosed in the party’s next annual return to the AEC.

Queensland has its own political donation disclosure laws, which are tougher than the federal regime. Returns are required to be lodged six-monthly, all gifts over $1000 must be disclosed, and any gift worth more than $100,000 has to be reported within seven business days.

One Nation’s Queensland Electoral Commission return for the relevant period in 2016 discloses nothing about the aircraft purchase or gift, but it does include an expenditure item of $1187.09 paid by the party to “Jabiru Aircraft Service”. There are numerous payments to Ashby’s companies for printing services, totalling some $17,000 in the same period. Who was paying for the running costs of the aircraft is a mystery.

But it’s pretty simple, really. Whoever paid for Hanson’s plane — however they paid for it and who legally or beneficially owns it — it was, in form and substance, a gift to the direct benefit of her eponymous political party, and she has treated it and talked about it as exactly that for the past two years…..

The Australian, 2 May 2017:

One Nation’s Senator Hanson shifted her story again on Monday night and said a $106,000 plane “came from” party donor Vicland’s Bill McNee to be used by her chief of staff James Ashby, but it was not a donation.

“So the plane came from Bill McNee, but it was not for the party it was to James for his business?” Sky News’ Andrew Bolt asked.

“Correct,” she answered……

Last night Senator Hanson said the Victorian businessman had allowed Mr Ashby to use the plane.

“He didn’t donate the plane to James Ashby. Having met James, they became friends,” Senator Hanson told Sky News.

“Bill’s a developer and he actually has a lot of business that he does in Queensland, and Bill was continually looking around for a plane.

“He found out James was a pilot (and) he thought: “Here’s a great opportunity to actually have a plane and to actually ¬use it as well.’ ”

The Australian, 3 May 2017:

Pauline Hanson’s controversial chief of staff says he has a “crossover” business relationship with the Melbourne property developer and political donor at the centre of a disclosure row over the purchase of the light plane used by the One Nation leader for election campaigning.

But James Ashby, whose iron-fisted control of Senator Hanson’s office has created ructions inside the party, insisted yesterday that he bought the $106,000 Jabiru 23-D aircraft in 2015 for recreational use and for his printing business in Queensland.

Senator Hanson raised further questions about the status of the plane on Monday when she confirmed on Sky News it had “come from” Bill McNee, but was for Mr Ashby’s firm, not her travel for One Nation.

This conflicts with the media-shy businessman’s assertion that he had no knowledge of the aircraft or how Mr Ashby acquired it. Mr McNee’s company, Vicland, is the Hanson party’s biggest donor, though in a rare interview last November he told The Australian he was stopping all political donations because “it’s something I don’t believe in any longer”.

Pressed on whether he had provided funds to Mr Ashby to buy the plane two years ago, Mr McNee said: “My God, if I am going to buy a plane, I would buy one for myself.” He hung up when contacted yesterday.

The Australian Electoral Commission is investigating whether the acquisition of the plane by Mr Ashby and its use to fly Senator Hanson to campaign events in Queensland before her re-election to federal parliament last July subverted financial disclosure laws.

BACKGROUND

The Guardian, 20 August 2003:

The fiery redhead, renowned for her garish wardrobe, had pleaded not guilty to fraudulently registering One Nation in the state of Queensland. She also denied dishonestly obtaining A$500,000 (£206,000) in electoral funds used for the campaigns of 11 politicians elected to the Queensland state parliament….

Prosecutors had accused Hanson and Ettridge of passing off a list of 500 supporters as genuine, paid-up members of One Nation in order to register the party and apply for electoral funding.

The Sydney Morning Herald, 20 August 2003:

Former One Nation leader Pauline Hanson and party co-founder David Ettridge have been jailed for three years each after being found guilty of fraud charges by a Brisbane District Court jury.

Judge Patsy Wolfe made no recommendation for parole.

           

Hanson, 49, and Ettridge, 58, had pleaded not guilty to fraudulently registering One Nation in Queensland on December 4, 1997.

Hanson had also pleaded not guilty to dishonestly obtaining almost $500,000 in electoral reimbursements after the 1998 state election.

But a Brisbane District Court jury found the pair guilty on all counts after more than nine hours of deliberations.

ABC Radio, PM, 6 November 2003:

MARK COLVIN: But first, the freeing of Pauline Hanson and David Ettridge. The One Nation co-founders have won their bid to get out of jail, after successfully overturning their convictions and their three-year sentences for electoral fraud.

Eleven weeks ago, Hanson and Ettridge were both sentenced to three years jail, after a jury found that they'd fraudulently registered the One Nation Party which they'd founded. Hanson was also found guilty of fraudulently obtaining nearly half a million dollars in electoral funding.

But they'll soon be released from jail, and family and friends were elated by the decision when it came down at Queensland's Court of Appeal this evening.

How soon will Adani go broke in the Galilee Basin?

Reading the information set out below leads me to wonder how the Federal Government and Queensland Government will cope, both politically and economically, if the Adani Group's Carmichael Mine and Rail Project leads to a massive derelict mine site with its twenty-six Australian subsidiaries under administration or in receivership.

INSTITUTE FOR ENERGY ECONOMICS AND FINANCIAL ANALYSIS (IEEFA)*:

2013

Remote Prospects: A financial analysis of Adani's coal gamble in Australia's Galilee Basin

The Adani Group is highly geared:

 Against an external market capitalisation of US$5.17bn, The Adani Group has an estimated US$12bn of net debt, a significant portion of which is US$-denominated with limited hedging.

Adani Power is of particular concern, being loss-making with net debt over 300% of its current market capitalisation.

2015

19 May The Latest Prospects for Adani's Coal Project? More Remote Than Ever

The project would require a massive and improbable infusion of debt, but a growing number of global banks key to most major coal-mining investments have eschewed it, mostly because of the risk it would pose to the Great Barrier Reef. (The 11 banks that have taken a public pass on the project include Deutsche Bank; HSBC; Royal Bank of Scotland; Barclays; Morgan Stanley; Citigroup; Goldman Sachs; JP Morgan Chase and most recently Societe Generale, BNP Paribas and Credit Agricole. In May 2015 Bank of America announced it would move to exit coal lending entirely.

15 September The Latest Prospects for Adani's Coal Project? More Remote Than Ever

With the Carmichael coal proposal commercially unviable at current or forecast thermal coal prices, the project is increasingly unbankable. Fifteen of the world's largest financial houses have either ceased working on this proposal or ruled out involvement, including both CBA and Standard Chartered, where advisory mandates have expired.

Continued momentum in technological developments underpins the scaled up commercial rollout of renewable energy and energy efficiency globally. As such, the strategic 'moment' for large-scale export-focused greenfields coal mines has passed.

2017

25 April Adani: Remote Prospects - Carmichael Status Update

Shareholders and financiers of Adani Enterprises face substantial risks due to the company's continuing development of the controversy-plagued Carmichael coal project in the face of major adverse structural shifts in market conditions.

The proposed mine, in Australia's remote Galilee Basin, remains a high-cost, high-risk project that is reliant on substantial public subsidies for it to be remotely financially viable. Even with concessional loans, IEEFA analysis shows the project is likely to be cash flow negative for the majority of its operating life.

Shifts in Indian energy policy and pricing have materially increased the risk of Carmichael becoming a stranded asset. Legal challenges and community opposition to the project persist and are likely to escalate if the project moves to construction.

With a market capitalisation of just US$1.9bn and net debt of US$2.5bn, Adani Enterprises Ltd will struggle to contribute equity for this A$5bn project. The project risks over-extending the balance sheet of Adani Enterprises to an extreme degree, creating a high level of financial risk to both shareholders and potential financiers……

In the years since Adani purchased the lease for the Carmichael mine, Indian government energy policy has shifted radically. Energy Minister Piyush Goyal has stated repeatedly that it is government policy to cease thermal coal imports—a policy that brings into question the very point of the proposed mine…..

* The Institute for Energy Economics and Financial Analysis (IEEFA) conducts research and analyses on financial and economic issues related to energy and the environment. The Institute's mission is to accelerate the transition to a diverse, sustainable and profitable energy economy.

The Institute for Energy Economics and Financial Analysis receives its funding from philanthropic organizations.  We gratefully acknowledge our funders, including the Rockefeller Family Fund,  Energy Foundation, Mertz-Gilmore Foundation, Moxie Foundation, William and Flora Hewlett Foundation, Rockefeller Brothers Fund, Growald Family Fund, Flora Family Fund, Wallace Global Fund,  and V. Kann Rasmussen Foundation.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

The Hindu, 5 May 2016:

"PSU banks are owed about Rs 5 lakh crore by corporate houses and of this roughly Rs 1.4 lakh crore are owed by just five companies, which include Lanco, GVK, Suzlon Energy, Hindustan Construction Company and a certain company called the Adani Group and Adani Power," he said.

The amount owed by this group "called the Adani Group" both in terms of its long term and short term debt on Thursday is around Rs 72,000 crore, he added quoting reports.

"Yesterday it was mentioned that the entire amount that the farmers need to pay as crop loans is Rs 72,000 crore. The Adani Group itself owes to the banks Rs 72,000 crore," he said.

The Hindu, 8 May 2016:

The billionaire Gautam Adani's Adani group, with Rs 96,031 crore debt [est. AUD $1.9 billion], is under pressure to sell its stake in the Abbott Point coal mines, port and rail project. The Adani Group's debt stands at Rs. 72,000 crore [est. AUD $1.4 billion]. Last year, Standard Chartered bank had recalled loans amounting to $2.5 billion as part of its global policy of reducing exposure in emerging markets. Global lenders have backed out from funding the $10-billion coal mine development project. State Bank of India has also declined to offer a loan despite signing an MoU to fund the group with $1 billion. An Adani spokesperson declined to offer any comments on the issue.

India Infoline News Service, 19 May 2016:

S&P Global Ratings revised its outlook on Adani Ports and Special Economic Zone Ltd. (APSEZ) to negative from stable. 

ABC News, 22 December 2016:

The business behind the planned Carmichael coal mine in North Queensland is facing multiple financial crime and corruption probes, with Indian authorities investigating Adani companies for siphoning money offshore and artificially inflating power prices

Companies under scrutiny for the alleged corrupt conduct include Adani Enterprises Limited — the ultimate parent company of the massive mine planned for the Galilee Basin.

Two separate investigations into allegations of trade-based money laundering by Adani companies are underway — one into the fraudulent invoicing of coal imports and the other into a scam involving false invoicing for capital equipment imports.

"They are very serious allegations and they are being conducted by the premier Indian government agency investigating financial crime," Australia's foremost expert on money laundering, Professor David Chaikin of the University of Sydney, told the ABC.

"The allegations involve substantial sums of money with major losses to the Indian taxpayer."

Adani denies wrongdoing.

Rediff, 10 January 2017:

For the past year, Adani Power has been undergoing an overhaul for its debt, including measures such as equity infusion and refinancing. These have helped the company survive the rough times since proceeds from the compensatory rates are yet to come by. 

The firm expects its recent equity infusion, debt refinancing and the compensatory rate to lead to a turnaround in its financial position….

On December 6, the Central Electricity Regulatory Commission granted a compensatory rate for Adani Power's Mundra unit on the grounds of changes in Indonesian coal policy and shortage of domestic coal. 

In the address to analysts, after the September quarter results, the management said: "Once we have clarity in the form of CERC orders, we would obviously have the reason to work with the rating agencies and then we will make our plans."

The CERC order, however, has not led to any change of credit ratings so far for the company as its implementation hinges on the required Supreme Court approval for the same. 

CatchNews, 14 February 2017:

Earlier this year, the State Bank of India reportedly approved a loan of around $1 billion (Rs 6,600 crore ) for the company's coal mine in Australia. However, after much hue and cry in the media due to the highly stressed balance sheet of the public sector bank, the approval was withdrawn.

Hindustan Times, 11 April 2017:

The Supreme Court on Tuesday set aside an order by the Appellate Tribunal For Electricity allowing compensatory tariff to Tata Power Ltd and Adani Power Ltd, sending down shares of both companies.

Shares of Tata Power reversed early gains to fall as much as 6.78%, while Adani Power slumped up to 20% to its lowest since February 21.

The tribunal, in April last year, had said the two companies needed to be compensated as the change in Indonesian laws on coal export prices were outside the control of these companies.

Financial Review, 11 April 2017:

Indian billionaire Gautam Adani has told Malcolm Turnbull his company will seek a taxpayer-funded concessional loan of up to $1 billion to support his proposed $21.7 billion coal mine in Queensland......

Following a meeting with Mr Adani and his executives in New Delhi on Monday night, Mr Turnbull cautioned the loan – to help build a $2 billion railway line to link the mine to the coast – would have to be approved on its commercial merits by the independent board which administers the $5 billion Northern Australia Infrastructure Fund.

The Northern Star, 16 April 2017:

Shares for Adani Power Limited, the Adani Group subsidiary energy provider in India, were trading at 44.25 rupees (AU$0.9) on Monday, but dropped to 32.90 rupees by the end of trading on Friday.

Adani Enterprises, the subsidiary connected with the Carmichael Coal project, traded on Monday for 120.10 rupees ($AU2.46) a share, but has also dropped, reaching 116.85 by the end of Friday.

Westpac Bank, Climate Change Position Statement and 2020 Action Plan, April 2017:

….the International Energy Association’s (IEA) modelling indicates that under a two degree scenario thermal coal demand will peak in the current decade and decline thereafter…..

However, for new thermal coal proposals we will: Limit lending to any new thermal coal mines or projects (including those of existing customers) to only existing coal producing basins and where the calorific value for that mine ranks in at least the top 15% globally. We define the top 15% as having a specific energy content of at least 6,300 kCal/kg Gross As Received. This value is referred to as the Newcastle high energy coal benchmark.