Adani coalmine: Axis Capital withdraws bid to insure Carmichael rail line

Extract from The Guardian

Adani Group

Adani coalmine: Axis Capital withdraws bid to insure Carmichael rail line

Investor action group says the insurer joins 57 other companies refusing to support the Queensland coal project

Ben Smee

 @BenSmee

Thu 3 Oct 2019 14.00 AEST

 Axis Capital has withdrawn from the Adani coal project, as activist groups continue to target companies in their bid to stop the construction of Carmichael. Photograph: Dan Peled/AAP

Another major insurer, Axis Capital, has shunned the Adani Carmichael coal project and withdrawn a bid to underwrite the construction of the mine’s rail line.

The withdrawal, first reported by Reuters, follows announcements from 15 of the world’s leading insurers which say they either won’t support the Carmichael mine, or won’t insure thermal coal projects.

It also presents a clear opportunity to activist groups seeking to stop the construction of Carmichael. Those efforts have targeted companies – on their front pavement and in the boardroom – who might provide logistical or financial support to Adani.

Market Forces, an investor action group that has had significant success by corralling shareholders, said it had confirmation from Axis Capital that it was withdrawing, joining 57 other companies to refuse support for Carmichael. Guardian Australia has contacted Axis separately for comment.

The companies include AXA, a French insurer with an agreement to “partly cover the [Adani] railway asset” until next year. AXA has said it won’t renew that contract, leaving Adani to seek alternate arrangements.

John Quiggin, a professor of economics at the University of Queensland, has said the Carmichael project “can’t proceed” without insurance.

The Market Forces campaigner Pablo Brait said the group understood the withdrawal of Axis Capital left Adani with two options – Lloyds of London and Canopius Group – and that these insurers were in negotiations with a broker engaged by Adani. Brait said it was not known how the latest development would impact those negotiations.

“Adani continues to be abandoned by its corporate partners that don’t want to be associated with a destructive new coal project,” Brait said.

“Axis’ move, following engineering firm Aurecon’s severing of ties to Adani, shows the Carmichael coal project is toxic, not just for our climate but for a company’s brand too.

“To meet the Paris agreement’s targets and limit global warming to 1.5 degrees, no new coal mines can be built anywhere in the world. Insurance companies are already bearing the cost of extreme weather driven by global warming.

“Rather than continuing to exacerbate the crisis, other insurers such as Canopius, Lloyds and AIG need to follow in Axis Capital’s footsteps and give the Adani Carmichael project the wide berth it deserves.”

The effort to drive potential contractors and other project partners away has ramped up in recent months, with activists soliciting leaks from companies bidding for Adani contracts, and subsequently attempting to obstruct their operations.

In August, the global engineering and consultancy firm Aurecon severed a longstanding business relationship with the Adani Group.

In response, the resources lobby effectively threatened to blacklist companies which made similar decisions, issuing a statement saying it would “reconsider and prioritise reliability in ... engineering and procurement partners for multi-million dollar contracts in the face of increased pressure from a minority group of anti-jobs activists”.

An Adani Mining spokesperson said in a statement: “Details on insurance providers for the Carmichael project are commercial in confidence however we have the necessary insurance requirements in place consistent with our construction activities.

“We don’t routinely discuss who our contractors and business partners are in order to protect these businesses from becoming the targets of activists. Legitimate law-abiding businesses should be able to conduct their day-to-day business free of harassment.

“We are all for people having their say providing people do it in a respectful and legal manner. However these activists do not speak for everybody in the community.

“After more than eight years of working on our project we have repeatedly demonstrated that we will not be intimidated or deterred from delivering on our promises to Queenslanders and we continue to get on with the construction of the Carmichael project.”