Insight

Adani royalty purchase highlights Galilee risks

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Report summary

In August Adani Group entered into an option agreement with Linc Energy to buy back a private royalty associated with its Carmichael project in Australia's Galilee Basin. The purchase clearly demonstrates Adani's commitment to developing the project and it appears to have secured the royalty stream at a sizeable discount to our base case valuation. But the degree of uncertainty facing Galilee Basin coal developments suggests Linc have secured a good price.

What's included

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  • Document

    Adani royalty purchase insight data.xls

    XLS 137.50 KB

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    Adani royalty purchase highlights Galilee risks

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Table of contents

  • Executive summary
  • Background to the royalty deal
  • Assessing the risk
  • Adani's perspective

Tables and charts

This report includes 4 images and tables including:

Images

  • Production and royalty earnings assumptions
  • Risks to royalty value
  • The impact of discount rate on royalty value
  • Implied probability of project development

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