Thursday 23 August 2012

GVK gets final green nod for Australian coal project

23 AUG, 2012, C R SUKUMAR, ET BUREAU
HYDERABAD:
In a major relief to India's GVK group and Australia's Hancock Prospecting, the Australian federal government on Thursday granted final environmental approvals to the GVK-Hancock joint venture's A$10b Alpha coal and rail project in Queensland state.

GVK owns 79% in the Alpha Coal project, while the balance 21% is held by Australia's richest person Gina Rinehart, who sold the majority stake in favour of the Indian firm in September last year.

In a setback to GVK, the project has been hanging fire for nearly three months after the federal government refused accord environmental clearances the project after the Queensland state government cleared it in May.

The Australian federal government, which had in June halted clearances following serious concerns expressed by the environmentalist led by global green watchdog Greenpeace, has now prescribed 19 conditions for GVK to protect the environment, while granting final clearances.

The Greenpeace led environmentalists have been raising concerns over the adverse environmental impacts on the fragile Great Barrier Reef and threatened species in the area by GVK's Alpha coal, rail and port project.

In a statement on Thursday in Hyderabad, GVK said the Australian federal environment minister Tony Burke granted approvals to construct and operate the Alpha coal mine and a railway line between the mine and the port at Abbot Point near Bowen. GVK said the coal mine and railway line projects would provide jobs to some 6,000 people and help the Australian government earn $1.5 billion a year in royalties and taxes at peak production.

The GVK group vice chairman GV Sanjay Reddy said, "This is another important milestone for our project which will provide significant benefits to the Alpha and Bowen regions, the state and the country."

Further, Reddy said the positive decision of the Australian federal government also paves way to ensure that more than 1.4 billion people, largely in Asia, that face a major electricity shortage are provided with an additional source of coal to enhance electricity supply to the region. The development also paves way to "improving quality of life of the people and overall economic development."

In September last year, GVK had bought 79% in the Alpha Coal and Alpha West projects and 100% stake in Kevin's Corner project, the three mines having an estimated 8 billion tonnes of coal resources, in Queensland state from Hancock Prospecting for $1.26 billion. GVK group had also acquired a 100% stake in the 500km railway line and a 60 million tonne a year port as a part of the 'pit-to-port' logistics solution.

GVK said the coal mining projects with superior quality low ash, low sulphur and low gas thermal coal will be reliably exported, largely to the Asian destinations and it expects to start project works early next year expecting first coal to be produced in 2015.

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