October 31, 2013
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IFC, World Bank rejects damning report on Tata Mundra, sparks civil society reaction

The International Finance Corporation's (IFC) Compliance Advisor Ombudsman (CAO) has delivered the results of its investigation into the 4000 megawatt (MW) Tata Mundra coal power plant in India, validating the complaints of affected fisherfolk regarding violations of the bank's own standards, and serious adverse impacts on affected communities. Despite these findings, IFC Management dismissed the report and World Bank President, Dr Jim Yong Kim, supported Management's response, thereby rejecting the findings of the report. The response from the Bank contradicts their rhetoric calling for urgent action on climate change and has sparked outrage amongst civil society groups in India and around the world who are condemning this failure to act. (Compliance Advisor Ombudsman, IFC Response to Compliance Advisor Ombudsman, Bank Information Centre) (Also see ‘Take Action”)

top news

Australia: Two board members of the Great Barrier Reef Marine Park Authority, an independent government agency charged with protecting the reef, have links to companies that could benefit from the development of new coal and gas export port developments. Both were present at a board meeting which substantially softened the board’s position on proposed new port developments. The federal Minister for the Environment has ordered an investigation. (ABC, Minister for the Environment)

Australia: A report by an anti-corruption agency found that the administration of coal policy in New South Wales was so defective that “it was almost inevitable that corruption would occur at some point.” The report, which was prompted by complaints over the allocation of lucrative coal areas in the Hunter Valley, has prompted the Lock the Gate Alliance to call on the state government to exclude ‘no-go areas’ from being included in exploration licences. (Independent Commission Against Corruption, Lock the Gate)

Bangladesh: The London-based Global Coal Management has announced a restructuring of the board in an attempt to win government support for the controversial Phulbari coal project. GCM has promised the Malaysia-based Mettiz Capital Limited that they will be awarded a directorship of the company if they get government approval for the mine by the end of the 2013. (Financial Express)

Burma: Mining at the Pawklo coal mine has been suspended by provincial Karen authorities following protests by villagers concerned about damage to agricultural land and water supplies. However, the Thai company East Star is reported as still having a mining permit issued by the central government. (Burma News International)
Canada: Hundreds of people protested against Port Metro Vancouver’s proposed expansion of coal exports through the Fraser Surrey Docks. Following the rally Surrey Council voted unanimously to oppose the port expansion. (CBC, CBC)

India: The Gujarat High Court has ordered the Gujarat Pollution Control Board to shut down coal-based gasifiers used in over 200 ceramic and 15 silicate plants near the city of Morbi unless they convert to liquid natural gas. The court was a responding to public interest case brought over the pollution impacts of the plants. (Times of India)

Indonesia: 449 coal exploration concessions covering over 39,000 square kilometres have been granted in central Kalimantan. The largest concession, covering 350,000 hectares, is the IndoMet Coal Project, owned by a joint venture of BHP Billiton (75%) and Adaro Energy (25%). At risk are large swathes of forests and local communities. (Guardian)

United States: The US Treasury guidelines restricting US support for coal projects at the multilateral development banks have been cautiously welcomed, although concern has been expressed about loopholes. The guidelines will affect how the US votes at the World Bank Group (WBG), Asian Development Bank (ADB), African Development Bank (AfDB), and European Bank for Reconstruction and Development (EBRD). (Reuters,  Huffington Post)


Australia: Cement company cans coal mine expansion after legal loss.

Burma:  Villagers oppose a plan to build a coal mine on confiscated land.
Kenya: Twenty six bids submitted for the construction of a proposed 500MW coal plant.

Mozambique: Clashes between factions, increasing risks and costs for coal companies.

"The coal mafia [in India] is not outside the government. It exists within the ministry of coal, coal companies, trade unions, state administrations and local political leadership … Dealing with the coal mafia requires strong political commitment at central and state government level and ability to effectively enforce law and order, which does not exist,”

the Times of India reported then-coal- secretary P C Parakh wrote in a letter in 2005 to the cabinet secretary.

companies + markets

Shenhua profit fall: China Shenhua Energy Company, the largest coal producer in China, has announced a 22% fall in profit for the September quarter. In the first nine months of the year coal prices have fallen by approximately sixteen per cent due to sluggish demand. (Reuters)

Push to expand role of private miners: In December the Indian Ministry of Coal plans to call for expressions of interest from private companies interested in public-private coal mining partnerships. The new policy is aimed at reducing reliance on Coal India to increase domestic production, while limiting dependence on expensive coal imports.  (Economic Times)

Adani losses grow: Adani Power, which is developing major coal power projects, reported a US$175 million loss for the September quarter. The company blamed its loss on factors including the devaluation of the rupee and the “higher import of coal due to limited availability of domestic coal.” Adani Power’s parent company is seeking to develop major coal mines in the Galilee Basin in Australia. (Financial Express,  Adani Power)
Met coal prices unsustainable, says Teck: The metallurgical coal, copper and zinc mining company Teck reported a 41% drop in profit in the September quarter. Don Lindsay, the president and CEO, stated that “the current price for steelmaking coal remains below what we believe is required to sustain adequate production in the industry in the long term.” Lindsay said that Teck was reducing capital spending and “reviewing the timing of our various development projects.” Teck is the world’s second largest exporter of metallurgical coal to the seaborne market. (BNN, Teck)


Energy (R)evolution: A Sustainable Poland Energy Outlook, Global Wind Energy Council, European Renewable Energy Council, Greenpeace International, October 2013. (Pdf)

An outline of how Poland, a coal stronghold in Europe, could rapidly shift towards renewables.

NSW Independent Commission Against Corruption, Reducing the opportunities and incentives for corruption in the state's management of coal resources, October 2013. (Pdf)

This detailed report makes detailed recommendations aimed at preventing corruption in the allocation of coal licences. While solely focussed on New South Wales’ issues, elements of their analysis have broader application.

take action

Open letter to World Bank on Tata Mundra findings

Sign an open letter from civil society groups opposing World Bank's rejection of The International Finance Corporation's Compliance Advisor Ombudsman findings on Tata Coal Plant, and demanding an explanation for why the findings of the report were rejected. Contact: Nicole Ghio at the Sierra Club <Nicole.Ghio@sierraclub.org>

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