OREANDA-NEWS. Canberra has given the go-ahead to the expansion at Australia's Abbot Point coal export terminal in north Queensland.

The approval — granted by the Department of the Environment yesterday — was the final major environmental hurdle needed by Indian energy and infrastructure firm Adani to proceed with its 60mn t/yr Carmichael thermal coal production and export project in Queensland's Galilee basin.

But the authorisation was granted under a number of strict conditions, including limitations to dredging and dumping of spoil. The terminal expansion will involve dredging no more than 1.1mn m? of spoil in confined pockets and areas near the Great Barrier Reef. This spoil must then be dumped on land in a dredge material containment area, the construction of which must not be undertaken between December and March.

The government rejected an original proposal for at least 3mn m? to be dredged and for the spoil to be dumped at sea.

When approving the proposal environment minister Greg Hunt said it "explicitly excludes the disposal of dredge material offshore in the Great Barrier Reef Marine Park and Great barrier Reef World Heritage property". The Abbot Point area is at least 20km from any coral reef and no coral reef will be affected, the ministry added.

The Galilee basin is a major battle ground for the pro-coal lobby and environmentalists, which remain critical of the plans. "Although we are pleased that the dredge spoil can no longer be dumped at sea, it is not appropriate to place it beside an internationally significant wetland, when there are better locations available further inland," Environmental group WWF said.

"Over the past 12 months, we have seen more and more banks abandon the sinking ship that is the Carmichael coal mine, which if built will feed the Abbot Point coal terminal expansion," it said. Several international banks have said they will not finance the Carmichael project amid concerns about greenhouse emissions and the financial viability of such a project given coal market projections.

Government subsidies will probably be required to develop the Galilee basin. But according to Adani, the benefits from the project will be felt locally and regionally, providing 10,000 direct and indirect jobs and generating around A$22bn ($15.8bn) in mining taxes and royalties to the state in just the first half of the project life. The basin has more than enough coal reserves to supply 200mn t/yr to the seaborne market.

The expansion of Abbot Point depends on the development of thermal coal mines in the Galilee basin by Indian infrastructure firms Adani and GVK, US investment group AMCI, Australia's Hancock Prospecting, Chinese state-backed Waratah Coal and China's Meijin, in addition to the most advanced project, the A$16.5bn Carmichael mine.

The decision to approve the Abbot Point project has been taken earlier than expected. The federal government had 40 working days from 27 October to review the Queensland government's environmental impact statement and was expected to delay the decision until after the Christmas-January holidays taken in Australia.