Photo by: Reuters
PERTH (miningweekly.com) – Indian major Adani has awarded a A$74-million contract to embattled South Australian steel producer Arrium Mining and Materials for a railway line.
Adani will source 54 000 t of hardened rail from Arrium for its 400 km North Galilee Basin rail link from the proposed Carmichael coal mine to the Abbot Point port, in central Queensland.
Adani Australia head of country and CEO Jeyakumar Janakaraj said the group could have sourced the rail cheaper from overseas, but that it had chosen to support local industry with the award of the contract.
The order is one of the largest placed with Arrium, which went into administration 12 months ago, in recent years.
“Australia needs a strong local steel industry just as it needs a strong coal and resources sector. Today’s announcement strongly supports both,” Janakaraj said.
He said the railway line was a “landmark deal” for the Galilee projects.
“The North Galilee Basin rail project is an essential open-access, multiuser element to open the Galilee basin not only for the Carmichael mine, but other projects.
“Our commitment to the Carmichael projects, and the benefits that will flow to regional Queensland, and India, is clearly demonstrated by this deal. There is more work to be done but this contract is a major step forward.”
The $16.5-billion Carmichael project will comprise an opencut and underground mine, running for a period of 90 years and producing an average 60-million tonnes a year of thermal coal. However, the project has been controversial from the start, with environmental groups heavily opposed to the development.