Those planning projects that come with environmental risks are increasingly encountering a lack of financial support, as with the case of a major coal mine in Australia
For an industry that promised tens of thousands of jobs, and billions of dollars to state and federal governments in Australia in the form of royalties, things are not turning out well. In late July, Indian energy company Adani quietly cancelled contracts with companies hired to begin work on its massive Carmichael mine in Queensland’s Galilee Basin, a $10bn project that would involve a train line to an upgraded port some 450km away, and increased shipping through the delicate Great Barrier Reef.
Carmichael – and similar projects proposed in north Queensland - have become a touch-point in the fierce debate raging in Australia about the country’s energy future. It’s a debate that pits the coal industry and the Federal government on one side against environmentalists and an increasing number of financial analysts on the other side, concerned about the environmental impacts or the risk of losing billions in so-called stranded assets.
It is the banks that find themselves in the middle. The coal industry, and prime minister Tony Abbott and his ministers – argue that “coal is good for humanity”, that it is essential to deliver electricity to hundreds of millions of people who have no access to the grid, and...