The Guardian - Joshua Robertson
Oil Change International argues there is a compelling case for six proposed Queensland projects to be axed in 'managed decline' of fossil fuel
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| A coalmine in the Galilee basin in central Queensland. A new report shows that existing fossil fuel projects worldwide are enough to push global warming beyond 2C. Photograph: Andrew Quilty/Greenpeace/AAP |
Miners seeking the green light to dig up Queensland's Galilee basin
should be stopped as a priority, according to a new report showing
existing fossil fuels projects worldwide are enough to push global
warming beyond 2C.
The report by the research and advocacy group Oil Change International
argues there is a compelling case for the six Galilee coalmining
proposals in the hands of Australian regulators to be axed in line with a
"managed decline" of global coal, oil and gas supplies already on tap.
It shows the embedded carbon emissions from operating fields and
mines worldwide, if run to the end of their projected lifetimes, would
drive warming beyond the 2C limit laid down by last year's Paris
agreement. Developed oil and gas reserves alone would take warming
beyond the aspirational 1.5C target.
The report shows that if Australia fully exploited its untapped coal
reserves – the third largest in the world behind the US and Russia – the
resulting emissions would blow almost a third of the world's carbon
budget for 1.5C.
About a fifth of these emissions (24 gigatonnes) would come from the six Galilee mining hopefuls who have applied for permits.
The largest is Adani's Carmichael mine, which over its lifetime would
contribute more than half of these emissions through 5 bn tonnes of
coal.
The China First mine proposal by Clive Palmer's Waratah
Coal,
which like others in the Galilee appears to hinge on Adani paving the
way with rail infrastructure, is the third largest at 1bn tonnes.
The report singles out Australia and the Galilee as being on the
"frontline of expansion" of the global coal industry and stopping this
development "must be a priority".
"The consequence of our analysis is that no new extractive or
facilitating infrastructure should be built anywhere in the world," it
says.
Fellow coal giants China and Indonesia have enacted temporary bans on
new coalmines and the US has a limited moratorium on new mines on
public land.
That leaves Australia as one of just "two countries that are
currently proceeding with major coalmining development", along with
India, the report says.
India, with its urgent need for economic uplift and relatively low
contribution to historical emissions, could be given a "generous support
package" funded by wealthy countries to pursue low-carbon development.
But the "hard choices" by governments about phasing out existing
projects should start in the developed countries such as Australia, the
report says.
Adani, an Indian conglomerate, has argued its Australian mine would
be pivotal in helping the Indian electricity sector move towards making
cheap energy available to the impoverished. The "energy poverty"
argument is
contested by Adani's critics.
The company, which has been embroiled in a long series of legal challenges in
Queensland
from traditional owners and conservationists, has reportedly downsized
the first phase of its mine and put off an investment decision till the
end of 2017.
The mine would now cost $4bn to get off the ground and initially
produce 25m tonnes a year, with 80% slated for its sister energy company
Adani Power, the
Australian Financial Review reported.
Tim Buckley at the Institute for
Energy
Economics and Financial Analysis said Adani's scaled-down plans
remained "unbankable" for a company that held US$2.6bn net debt beside a
market capitalisation of just US$1.2bn.
Adani Power was in even worse "financial distress", with net
debts of more than US$7.3bn against market capitalisation of US$1.4bn,
Buckley said. It was also yet to build most of the large power stations
in western India which Carmichael would supply.
"Lacking economies of scale, this low-quality thermal export coal
proposal lacks strategic relevance in India where the installed cost of
solar is now lower than that of imported thermal coal," he said.
This casts doubt on broader development prospects in the Galilee
basin, which Buckley said was "still stranded 400km inland from the
coast without any industrial-grade power, road, water, aviation or rail
infrastructure in place".
The report's author, Greg Muttit, said there were "only three
possibilities" to consider in the future of fossil fuels extraction.
"We can manage the decline of our existing fields, shifting to clean
energy and redeploying workers," he said. "Or we continue to develop new
reserves that then have to be shut down suddenly, stranding assets,
costing investors, and causing havoc in fossil fuel extraction-dependent
communities.
"Or we just carry on as we are – and wreak economic, ecological and human catastrophe on the world."
Stephen Kretzmann, the executive director of
Oil
Change International, said: "If the world is serious about achieving
the goals agreed in Paris, governments have to stop the expansion of the
fossil fuel industry.
"The industry has enough carbon in the pipeline – today – to break through the sky's limit."
The report says the study was the first to examine the climate change
implications of potential emissions from current oil, gas and coal
operations in light of the Paris agreement. It draws on industry data
from the oil and gas consultancy Rystad Energy and carbon budgets
derived from the Intergovernmental Panel on Climate Change.
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