Tony Abbott's Government is cheering on a proposal environmentalists say would do irreparable damage.

The Great Barrier Reef is one of the natural wonders of the world. The 2300km-long coral reef is home to a stunning array of sea and bird life and is a mainstay of the Queensland tourism industry.

So you'd think any government would do what it could to protect this valuable asset.

Yet in the topsy-turvy land that is Australian public policy, it's the big banks that are trying to save the Barrier Reef from destruction, while Tony Abbott's Government cheers on a proposed coal mine that environmentalists say would irreparably damage the reef.

A few days ago National Australia Bank (owner of Bank of New Zealand) became the latest bank to say it would not back the A$16 billion ($17.6 billion) coal mine which Indian multinational Adani Group wants to build in North Queensland.


NAB said that, along with the usual business considerations when assessing a loan, it also looked at environmental, social and governance risks.

"We have a role to play in transitioning to a low-carbon economy. We also believe we have the responsibility to fund projects that will secure Australia's energy needs now and into the future and coal has an important role to play in this," the bank said.

Part of Adani's plans involved a massive expansion of a coal terminal in close proximity to the reef so the company could ship out the coal for use in India.

The plan involves dredging in Great Barrier Reef waters, though earlier plans which included dumping of potentially toxic seabed in reef waters and sensitive wetlands were scrapped amid public outcry.

The Adani mine has been stuck in the approvals process for five years and another setback came last month when the Federal Court set aside the Environment Minister's approval for the project after an appeal from environmental groups.

Abbott and his Government were dismayed and promised to pass legislation to ban environmental groups from challenging projects in the courts.

Abbott's Attorney-General, George Brandis, said he was "appalled" by the decision that was a result of "vigilante litigation". Only in topsy-turvy land does the country's chief legal officer get upset by the rule of law and chastise those who seek legal remedies.

It was another death blow for the project.


Many of the world's major funders of coal projects including Citigroup, Deutsche Bank, Morgan Stanley, RBC, Credit Agricole, BNP, Barclays, Goldman Sachs, JPMorgan, Societe Generale and HSBC, have already said they would not fund the development of a coal project requiring export facilities to be built so near the Great Barrier Reef.

True, NAB's recent decision was not all good corporate citizenship. There are some hard-headed business reasons for refusing to back the mine.

Public opinion has turned against the mine and NAB would have wanted to avoid a consumer backlash. Tumbling coal prices have also thrown the profitability of the project into doubt.

In fact, those of a cynical disposition might note that the NAB decision came as news emerged that Korean industrial giant LG said it would not be purchasing coal from the project, leaving the proposed mine with just one external customer.

But the fact remains that the banks have recognised the reality that coal will become an increasingly uneconomic source of power as green energy technologies improve and as, bit by bit, the world moves away from fossil fuels.

Tony Abbott. Photo / NZME.
Tony Abbott. Photo / NZME.

Abbott, by contrast, remains an enthusiastic backer of the coal industry, now and in the years to come.

"Coal is good for humanity, coal is good for prosperity, coal is an essential part of our economic future, here in Australia, and right around the world," he said at the opening of a coal mine in Queensland.

"Energy is what sustains our prosperity, and coal is the world's principal energy source and it will be for many decades to come."

Abbott is dismissive of climate science and believes that Australia has to choose between economic growth and fighting climate change.

He has as good as killed off Australia's nascent green energy sector by cutting the Government's target for the amount of renewable energy the country should produce.

His attempts to disestablish the Clean Energy Finance Corporation - a publicly underwritten "green bank" established by the previous Government - was stymied by the Senate.

This is not to say that the Government should shut down all coal mines as some of the more radical environmentalists would have it do. Coal-mining is still a major employer and source of export earnings.

But it will not be forever.

By sticking his head in the sand and not acknowledging the world's energy demands are changing, Abbott is doing Australia a disservice.

We have the chance to start a gradual transition to a low-energy and green-energy economy, in our own time and in our own way. If we don't the change will be forced upon us in the years to come - and it will be a lot more painful than if we started today.