Adani ‘blindsided’ by Government over loan

ENERGY giant Adani has admitted it was blindsided and shaken by the Palaszczuk Government's sudden decision to veto a Federal Government NAIF loan for the mega-mine.

But the company's Australian boss Jeyakumar Janakaraj yesterday vowed it would not be beaten by environmental activists' relentless campaigning and that the central Queensland project would go ahead.

"There is no way they will win,'' the defiant chief executive said.

In his first interview since Premier Annastacia Palaszczuk's shock election campaign announcement of the veto, Mr Janakaraj said there was no warning or discussion with the Government beforehand.

"No one is prepared for bad news. Obviously it shook us," he said.

The loss of access to the loan, which could have been up to $900 million, had set the project back and moved the goalposts but would not delay the development.

It is now certain Adani will not meet its self-imposed deadline to have all its financing by the end of December, but while he would not comment on financing, he refused to accept that the Northern Australia Infrastructure Facility veto had affected the project's credibility.

Jeyakumar Janakaraj said he had not spoken with the Premier since the move but said the two offices were still talking. Picture: Tara Croser
Jeyakumar Janakaraj said he had not spoken with the Premier since the move but said the two offices were still talking. Picture: Tara Croser

"It has not affected the credibility of the project because that is delivered on its worth, on its economics, its fundamentals and coal demand,'' Mr Janakaraj said.

He said he had not spoken with the Premier since the move, which dominated the first half of the election campaign, but the two offices were still talking and there was no ill feeling. He rejected suggestions it had been a betrayal.

"Betrayal is a very strong word,'' he said.

"The goalposts have changed (but) we are focused on all our options. We are extremely committed. Every project the company has said it will deliver, it has delivered.''

He would not comment on the financing, but said the overall target to produce the first coal in 2020 had not changed and the company now had about 800 people working for it.

Adani's Indian-based parent has invested $3.3 billion in the project so far, and earlier this year allocated $400 million to get early works started.

It needs to raise a further $2.5 billion to build the mine and rail line.

The veto of the NAIF loan not only set back the project's timing but also forced Adani to scrap an agreement with Downer Group to build and operate the mine.

That followed announcements from China that none of its banks would fund the project, but Mr Janakaraj said there were other options open to it and the company was not going to give up.

"Money is continuously flowing into the project,'' he said.

"It is not a problem for us, but when there is a backstop (like NAIF), it is easier to make certain assumptions and go forward, and when the backstop is not there, obviously it changes the transaction.''

Adani has also been boosted by analysts stating that coal demand was going to rise in India and southeast Asia despite the growth of ­renewables.

And while Deputy Prime Minister Barnaby Joyce is pushing for Aurizon to receive NAIF funding for its own Galilee Basin rail line, Mr Janakaraj said using that scheme was not part of Adani's thinking or planning.

The NAIF veto was another challenge in a long line of hurdles thrown in front of Adani. It would have been producing coal next year on its original timeline but it has faced continued legal challenges to its approvals.

He said business in Australia had to be made simpler. "It does matter a lot that things should be more stable,'' he said.

Although China has now walked away from any financial involvement, Mr Janakaraj said there were other ways to raise funds and pointed to a recent $US2 billion ($A2.5 billion) deal Adani did in India, while it has also refinanced the debt held by its Abbot Point coal port.