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Wednesday, December 1, 2021

Bank of New York Mellon severed ties with the controversial Adani coal mine

The Bank of New York Mellon has severed its connection with one of the most controversial coal mines in the world, after the Financial Times reported that the bank’s Australian subsidiary was preparing to help finance the Carmichael project in Queensland.

The U.S. investment bank issued a statement on Friday saying that it has reviewed its relationship with the Adani Group, an Indian conglomerate that is developing the Carmichael mine, and “decided to withdraw from all legacy transactions with Adani, Australia.” The bank added that it will not trade with Adani in Australia in the future.

Adani has been working hard to attract bank funds for the Carmichael Coal Mine, which is expected to produce about 10 million tons of coal each year, and has sparked protests around the world.

Earlier this year, a Carmichael contractor stated that it was unable to purchase insurance for the project due to environmental issues.

A survey conducted by the Financial Times this week on bank financing of fossil fuel projects revealed that BNY’s Australian subsidiary BTA Institutional Services is preparing to cooperate with Adani on the Carmichael project.

At the same time, the bank is negotiating to join the former Bank of England governor Mark Carney’s net-zero climate initiative, which was vigorously promoted in the COP26 climate negotiations in Glasgow this week.

The e-mails and documents seen by the Financial Times described BTA as the “financier” and “party to Adani” for the project. BNY responded that although the contract has been prepared on the grounds of BTA’s participation, it has not yet been signed.

It also stated that it did not provide funding for the project, but did provide “administrative services” for Adani in Australia, including serving as a security trustee.

“The Bank of New York Mellon has determined that this business does not comply with our ESG principles,” the bank said in a statement announcing its decision to cut the relationship.

The bank added that it will continue to fulfill its contractual obligations during the dissolution of the transaction and until its role is terminated. It did not disclose what other services it provided to Adani outside of Australia.

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