Standard Charter faces calls to quit 'carbon bomb' mine


Click to follow
The Independent Online

Greenpeace has renewed its demand that the emerging markets bank Standard Chartered walks away from what has become known as Australia’s “carbon bomb” as a rival lender severed its ties with the controversial project.

Commonwealth Bank of Australia walked away from its role as financial adviser to the A$16bn (£7.45bn) Adani Carmichael coal mine, whose planned location on the doorstep of the Great Barrier Reef in the state of Queensland has created an international outcry.

It would be the country’s biggest coal mine, and one of the biggest in the world, but environmentalists have argued that the project would require massive seafloor dredging and port expansion, resulting in hundreds more coal ships navigating through the Reef.

Greenpeace also said it would produce 121 million tonnes of carbon dioxide emissions yearly at maximum production, driving climate change – already a grave threat to the future of the Unesco World Heritage site.

A spokesman for Standard Chartered, a major lender to the project’s Indian developer Adani, said: “At our AGM back in May, we said we’d suspend work on the project, engage with all of our stakeholders and consider our wider energy financing position. That remains the case.”

But Greenpeace complained that the London-listed bank remained “the leading financial adviser to the project”.

Greenpeace campaigner Sebastian Bock said: “Seeing Australia’s largest bank walk away from this highly controversial project should make Standard Chartered and their investors think twice about their involvement. Standard Chartered is now standing alone as the only known financial institution that has not cut links with this uneconomical and destructive mine.”

The mine’s future is already under a cloud after its approval was declared invalid by Australia’s Federal Court because of advice about the possible impact on two vulnerable animal species – the Yakka Skink and the Ornamental Snake.

Greenpeace’s renewed attack on Standard Chartered – it raised the issue at the annual meeting earlier this year – came as the bank issued its first-half results which saw new chief executive Bill Winters further stamping his authority on the struggling bank.

Mr Winters, who has already shaken up its management team, slashed the interim dividend by a larger-than-expected 50 per cent to just 14.4 US cents (9.2p) a share. He said the cut was “to better reflect our current earnings expectation and outlook and to set a payout ratio consistent with our desire to continue to strengthen our capital position”.

He also gave the clearest indication yet that the bank will stay in London – thanks to the Chancellor’s decision to phase out the banking levy and replace it with a profit surcharge – saying bosses were “very happy with the Budget”.  He said it took one of the biggest issue over the London domicile “off the table”.

Standard Chartered reported a 44 per cent fall in pre-tax profit to $1.8bn, on revenues down 8 per cent to $8.5bn. Higher bad debt writedowns, currency fluctuations and regulation costs hit earnings.