Councils backtrack on previous statements and say they do not own the site or have any say in how facility is built

Two Queensland councils that together contributed $34m to an airport serving Adani’s coalmine have contradicted previous statements and now say they do not own the site or have any say in how the facility is built.

Townsville and Rockhampton councils announced in October that they would spend $18.5m and $15.5m respectively on an airport hundreds of kilometres away at the Carmichael coalmine as part of a funding deal with Adani.

At the time, officials from Townsville council publicly stated the $34m was to “build and own the airport”.

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But after Queensland’s corruption watchdog referred allegations of wrongdoing to the state’s local government department, the councils have admitted that if the mine went ahead they would not own the airport.

The agreement with Adani, the councils said in October, would add millions of dollars and thousands of jobs to the two economies by making both cities “Fifo hubs” (fly in, fly out) for the mine.

The Queensland Crime and Corruption Commission has referred the funding deal to the state’s local government department because of “alleged corrupt conduct” relating to a tender to build the airport.

The allegation – prompted by a complaint made by the Townsville businessman Philip Batty – is that construction company Wagners was awarded the tender to develop the airstrip without council input.

Wagners – a publicly listed Toowoomba-based firm – made a statement to the Australian Stock Exchange this week, saying after a “competitive tender process” it was negotiating the “potential future construction” of the airport directly with Adani.

But a publicly available list of previously awarded tenders for the mine did not include the construction of the airport and Adani refused to answer questions put to it by Guardian Australia.

The complaint hinges on whether Townsville and Rockhampton councils own the airport or are funding its construction for Adani.

The CCC initially rejected Batty’s complaint on the basis of advice from the local government department that the councils did not own the airport and as such were not responsible for the tender.

But it agreed to refer it after Batty pointed to occasions where council officials had suggested otherwise. In October, the Townsville mayor, Jenny Hill, reportedly told the ABC the two councils would own the airport beyond the life of the mine.

“Councillors yesterday approved the investment of up to $15.5m over two financial years in a joint venture with Rockhampton City Council, to build and own the airport down in the Galilee basin,” she was quoted as saying. “Now this airport will not only be for this project but for all the projects that are destined to open up in the Galilee.”

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Others on Townsville council also believed the $18.5m was for the purchase of an airport.

Paul Jacob was the only Townsville councillor to oppose the airport deal with Adani because he did not think there was sufficient return on the investment, but he says he believed the council was entering into a shared ownership deal with Rockhampton.

“Both the CEO and the mayor said that we would own the airport, the money was like a half-ownership deal with Rockhampton,” he said. “But now the more I’m reading, it’s confusing even for me as a councillor. There’s mixed messages from both sides.”

In fact, both councils now say the airport is not theirs and would belong to Adani.

A spokesman for Townsville council told the Guardian that both the land and airport would be owned by Adani and the two councils would operate it “for the life of the mine via an exclusive long-term lease”.

“Council has nothing to do with the procurement process, that is entirely a contractual matter between Wagners and Adani,” the spokesman said.

Similarly, Rockhampton council told the Guardian it was a 30-year lease and that “any questions regarding ownerships or construction of the airport should be directed to Adani”.

But if not owning the airport means the councils avoid trouble with the CCC over the Wagners tender, it is cold comfort to Batty.

“It basically means we’re paying $18.5m for something we don’t own,” he said. “We’re paying Wagners on behalf of Adani when we don’t have a contract with Wagners. It’s really messy.”

The agreement between the two councils and Adani remains hidden, so other questions about the terms of the deal also remain hidden.



For example, asked whether under the agreement Adani could still fly workers in and out of other airports such as Brisbane, the Townsville council spokesman said there were “conditions in place to make sure the Fifo jobs, and positions in Adani’s headquarters, go to people living in Townsville”.

“There are also protections to ensure council doesn’t spend money on the airstrip if the mine does not go ahead,” the spokesman said.