Adani ties up $1-bn SBI loan for Oz coal venture

MUMBAI: Adani Enterprises on Monday said the State Bank of India, the country’s largest commercial bank, will lend up to $1 billion (`6,100 crore) to develop it’s $7-billion coal mine in Queensland, Australia, at a time when industry slump has pushed prices of the commodity to a five-year low.

Adani Mining signed an agreement with SBI for the credit facility, which will be subject to a detailed assessment of the mine project at Carmichael, Western Queensland, that has estimated reserves of 11 billion tonnes of thermal coal used in power projects. The Adani Group posted a revenue of $9.4 billion (`58,000 crore) last year and has a consolidated debt of ` 57,000 crore.

Queensland state on Monday cleared the project, which also includes a rail line and port infra- structure for shipping the mined coal to India.

“The MOU with SBI is a significant milestone in the development of our Carmichael mine. It aligns perfectly with our clear vision for delivering energy security in the Indian market,” said chairman Gautam Adani. Gautam Adani is currently in Australia as part of a business delegation for the G20 summit, which was attended by Prime Minister Narendra Modi.

The Adani Group plans to ship coal from the Queensland mine to Indian power plants, which are grappling with an acute shortage of coal due to inadequate production. Apart from the loan from SBI, the group will also have to scout for other financiers to fund the remaining part of the project.

Adani Mining said the government of Queensland has committed to invest in the rail component of the project, but didn’t elaborate.