‘Labor does not rip up contracts, and we don’t create sovereign risk,’ leader says, in cooling of recent comments

Shorten says Adani mine decision will be made when Labor is in government

Bill Shorten says Labor will make a decision about the future of the controversial Adani coalmine when it next wins government rather than taking any concrete position imminently, and will not rip up contracts or create sovereign risk.



In a significant cooling of his recent public signalling on the Adani project, a statement issued by Shorten’s office on Thursday says, “if there are decisions to be made in government, Labor will make them in the national interest, based on relevant laws, and the best and most recent information before us”.

Labor prepared to revoke Adani coalmine licence if elected, says Cousins Read more

“Labor does not rip up contracts and we don’t create sovereign risk,” the statement says.

The Labor leader’s indeterminate position will infuriate the environment and activist groups that have attempted over the summer to persuade Shorten to adopt a stronger stance on Adani – a lobbying effort that was triggered by Shorten himself.

The Labor leader reached out to the environmentalist and businessman Geoff Cousins last December, signalling he wanted to take a tougher line against the project, which resulted in the two men visiting the Great Barrier Reef and the Adani mine site in late January.

The statement from Shorten’s office does not deny Cousins’ detailed account of events from last December through to last weekend which the former president of the Australian Conservation Foundation shared with Guardian Australia on Wednesday.

It confirms that Shorten requested a briefing from the Australian Conservation Foundation and Cousins on the Great Barrier Reef and their views on the proposed Adani coalmine. “This occurred in Queensland last month,” the statement says.

“They provided a valuable perspective on the reef and the mine. Bill really appreciated the time and effort they gave informing him of all the environmental issues”.

“The visit renewed Bill’s convictions on the importance of protecting the reef and the environment”.

Cousins says Shorten reached out in December and then remained in contact throughout January and this month. According to Cousins, Shorten signalled his support for Labor revoking Adani’s licence based on concern about the impact of the project on the reef, on groundwater and endangered species.

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Again, according to Cousins’ account – not contradicted by the Labor leader – Shorten first signalled to him that Labor would adopt that position imminently, and then asked for more time because he’d met internal resistance, before declining to clarify what position the ALP would adopt.

The statement from Shorten’s office reiterates the fact the Labor leader is “deeply sceptical of the proposed Adani coalmine”.

“He believes if it cannot stack up environmentally or commercially, it should not go ahead. So far it hasn’t, and he doesn’t believe it will,” the statement says.

The statement also downplays the input from Cousins and the ACF. “Bill has sought lots of feedback on the proposed mine”.

“He’s spent a lot of time in regional Queensland hearing different views – from coalminers, conservationists, landowners and scientists,” the statement says. “He also held three town hall meetings last week in Townsville, Mackay and Rockhampton to hear from locals”.

The Turnbull government has gone on the offensive against Shorten for delivering different messages to different constituencies, and for being “two faced” – and the Greens will also attack Labor in the Batman byelection, which is due on 17 March.

The Greens leader, Richard Di Natale, said on Thursday Labor needed to adopt a clear position on the project, as Bob Hawke did on the Franklin dam. “Shorten needs to make an unequivocal statement, that Labor won’t let that mine proceed, and we are prepared to rip up contracts,” the Greens leader said.

“That’s what Bill Shorten needs to say”.

Labor has been divided internally about how hard to go against Adani. Some favour the Cousins position, others think that will cost Labor political support in Queensland.

As well as the political calculations, there have also been internal concerns about the viability of legal avenues to stop the project.

Legal advice sought by the Australian Conservation Foundation argues the commonwealth environment minister has discretion to revoke the Environment Protection and Biodiversity Conservation (EPBC) Act approval for Adani “on at least two grounds”.

The first ground would be “new information of the consecutive bleaching of the Great Barrier Reef, indicating increased sensitivity to greenhouse gas emissions” and the second would be “new information of the insufficiency of offsets for the endangered black-throated finch, indicating a threat to the continued survival of the species from the Carmichael project”.

The legal advice from the Environmental Defenders Office in Queensland argues the revocation would not trigger a sovereign risk issue, or leave the government exposed to a compensation claim from the company, because the power in section 145 of the EPBC Act to revoke an approval “is clear and unambiguous, and is essential for the minister to protect the environment from significant impacts not assessed prior to an approval being granted”.

The ACF advice says the power of revocation under section 145 of the EPBC Act “is not properly considered the acquisition of property and therefore does not attract the obligation to pay compensation”.

But some in Labor think that legal opinion is overly optimistic, and there has been internal resistance to inserting a “climate trigger” within the EPBC Act because that could be a mechanism to shut down the coal industry in Australia.

The CFMEU warned Shorten against adopting a hardline on Adani on the basis that it would trigger a divisive debate inside the party and the labour movement about the future of coal.