Greens bill to scrap mine could force compo payments, Adani warns
The risk Queensland might need to pay compensation to miners if it scrapped all projects in the Galilee Basin must be balanced against the devastating effects of climate change, Greens MP Michael Berkman says.
Mr Berkman has introduced a private member's bill to ban all coal mining in the Galilee Basin, including Adani's Carmichael mine, and rip up all existing leases, with no compensation to be paid.
"The Queensland government is sovereign and can make decisions of this nature," he told a committee hearing into the bill.
"No matter how many billions of dollars these companies might want to throw around as the amount they've spent as compensation they should be entitled to, there is no basis to claim any future profits they might have made.
"If the committee is concerned there is a genuine risk of some compensation being paid, let's consider that in the context of the cost to Queensland, the cost to our communities of climate change."
However, Adani Mining Australia chief executive Lucas Dow said the bill would create sovereign risk for Queensland and create questions about the "investability" of Queensland.
"The natural extension of this is, if this was to apply to the Galilee Basin, then clearly the rest of the industry would be concerned about the potential flow-on effects, particularly the retrospective nature of the bill," he said.
Asked about a potential compensation claim, Mr Dow said Adani had already invested more than $1.4 billion in road and rail projects.
"If this legislation was to be ... enacted, clearly there'd be a legal recourse to this, not only for costs incurred but obviously for the future profits that would have been foregone as well," he said.
"So that would be a sizeable compensation."
At full operating capacity, Mr Dow said the royalties the Carmichael mine would pay would "run into the billions".
Queensland Resources Council chief executive Ian Macfarlane said scrapping existing mining leases without compensation would harm international confidence in Queensland.
"The impact on sovereign risk would be not only on potential future investments in mines but, in fact, potential future investments in Queensland per se," he said.
"Because it would be seen as a move by the government of the day to not offer the level of certainty that you would expect from a developed country such as ours, a First World country."
Committee member Jim Madden questioned whether the Queensland government would have to pay compensation of $660 million for three exploration permits accepted in the Galilee Basin, using calculations from a case in NSW.
However, Mr Berkman said the cases were different.
Mr Berkman said the bill was a "drastic step" and unconventional because it "takes away the rights of massive mining companies and rips up Adani's mining lease".
"The best-available science leaves absolutely no room for doubt that the climate cannot afford for us to exploit new coal resources, especially on the scale proposed in the Galilee," he said.
"Any politician without a plan for an orderly phase-out of thermal coal with good jobs, housing and security for workers is not serious about climate change or Queensland's future."
Mr Berkman said the bill would have no impact on Queensland's budget because royalty revenues from the projects were not yet factored into forecasts.
Department of Natural Resources, Mines and Energy deputy director-general policy Benn Barr said scrapping all mines in the Galilee Basin could impact investor confidence and service providers.
Treasury officials confirmed the Queensland government had not yet signed a royalties agreement with Adani.