Australian mine contractor fails to obtain insurance on ESG concerns

24th May 2021 by Emma Goring

A controversial Australian coal mine contractor said he was unable to insure the project due to environmental issues and emphasized how the country’s fuel funding was depleted.

The BMD Group working on the Carmichael mine at Adani Enterprise appeal A parliamentary investigation said that the government might have to ask for insurance.

BMD claims 12 from companies warning that suspension of lending to the sector due to environmental, social and governance concerns risks destroying Australia’s A $ 20 billion (US $ 15.5 billion) annual coal export industry. It was one of more than one submission.

BMD is building a section of Railroad Carmichael’s 10mton annual steam coal project that has impacted the world Climate protest.. According to the former submission, BMD was rejected by at least 33 underwriters of the project’s public liability insurance in partnership with Adani.

The BMD said that if customers cannot get insurance, they need to absorb the risk on behalf of the contractor or the government needs to provide insurance from public funds.

“If we don’t take action, very few contractors will be willing to work on these critical infrastructures,” says the group.

The BMD said it was exposed to activities from climate change protesters and anti-coal groups, including the threat of violence against group owners and families.

Environmental activists oppose the Carmichael mine proposed by Indian miner Adani outside the Parliament building in Brisbane, Australia AP

Australia’s investigation into the treatment of the export industry in the financial sector was conducted after Keith Pitt, the Minister of Resources, the accused banks and pension funds were “corporate activities”.

“This is exactly why I asked for this inquiry and I am looking forward to the results,” Pitt said of the BMD submission. “How could a company building a railroad track that could carry cattle, grain, people, and other things be denied insurance because it was carrying coal? , Does not affect construction risk at all. “

Adan owned by a big Indian Gautam Adani, Banks and insurance companies Complete withdrawal from coal By 2030, this will have a “dramatic and negative impact” on the industry.

Adani told the Financial Times that he had the necessary insurance for the entire Carmichael project.

Coal company New Hope Group said the impact of a financial company’s withdrawal from the sector would be “disastrous.”

Apia, a leading group in the oil and gas industry, said banks and pension funds are increasingly informing companies that ESG concerns have prevented them from investing in projects. However, “the positive role that oil or gas can play in providing energy security in the decarbonizing world economy” is often not considered, it claimed in the submission.

The Australian Insurance Council said in a study that its members recognized the importance of the country’s export industry and noted the efforts of investors and regulators to address the risks posed by climate change.

“The general insurance industry continues to support and enable effective risk management for Australian exporters … In line with regulatory guidance and a modern understanding of legal definition,” the council said. It was.

BMD did not respond to a request for comment on the insurance status.