Coal news and updates

Adani in pact with POSCO for rail line in Queensland

July 18: India’s largest integrated private power, port and infrastructure developer, the Adani Group, on July 18, said its subsidiary, Adani Mining Pty Ltd, has entered into a binding agreement with POSCO E&C, a subsidiary of South Korean steel giant POSCO, to develop a greenfield non-electrified standard gauge heavy haul rail line to open up the Galilee Basin coal reserves in Queensland, Australia.

Construction of the 388-km North Galilee Basin Rail (NGBR) is expected to commence in early 2015 and once completed will have a capacity to haul 60 million tons of coal annually, the Adani Group said in a release.

The project will lead to the opening of the Carmichael mine project which will deliver in excess of 10,000 jobs, and also provide vital opportunities for the Australian coal industry, the release said.

The agreement gives exclusive rights to POSCO E&C to be the engineering, procurement and construction (EPC) contractor for the project. The binding agreement has set clear pathways for executing the final contract by the end of this year.

Commenting on the development, Adani Group Chairman Gautam Adani said: "The rail project will lead to opening up of the Carmichael mine project which will deliver in excess of 10,000 jobs and will also provide vital opportunities for Australian infrastructure development and contribute to the energy security of India..."

Adani Australia CEO and Country Head Jeyakumar Janakaraj said: “This is the first major step towards finalising the project’s construction contracts and we are proud to be associating with a partner of POSCO’s E&C standing. The binding agreement will enable us to develop a cost-efficient rail solution and this relationship gives Adani access to the Korean market, POSCO’s expertise and capital."

POSCO E&C is one of the world’s largest construction companies and has significant experience in developing rail infrastructure.

POSCO E&C President and CEO Tae-Hyun Hwang stated that the rail project will greatly benefit from this partnership. “This is the largest EPC project in the region for POSCO E&C and we will put in our best effort to maximise our engineering, procurement and financing capabilities to successfully complete the construction,” he said.

Adani and POSCO E&C will develop this project, which will be jointly managed by Adani and POSCO E&C.

The Queensland government has declared the rail corridor as a Strategic Development Area. This rail infrastructure is aligned with the Queensland government’s policy of strategic infrastructure being located to allow multi-user participation and will provide access to other miners, helping unlock further growth opportunities for jobs in Queensland.

The Adani Group is one of India’s leading business houses with revenue of over $9.2 billion.

Founded in 1988, Adani has grown to become a global integrated infrastructure player with businesses in key industry verticals - resources, logistics and energy. The integrated model is well adapted to the infrastructure challenges of the emerging economies.