Calling a snap media conference on Friday afternoon, Ms Palaszczuk accused the LNP in Canberra of a "smear" campaign against her and her partner, PricewaterhouseCoopers infrastructure advisory director Shaun Drabsch.

The apparent smear campaign related to a rumour circulating among LNP senators about Mr Drabsch's work, Ms Palaszczuk said.

PWC acted for Adani on its application to the federal government's Northern Australia Infrastructure Facility for an almost $1 billion concessional loan for its rail link.

Ms Palaszczuk said her partner assisted PWC's work as a member of its national infrastructure advisory team, only at a federal level, and that was after Adani's mining leases were approved by the Queensland government.

The Premier said when Mr Drabsch took the role, PWC's managing partner in Brisbane wrote to her to assure her they would avoid conflicts of interest in Mr Drabsch's role and in her role as premier.

"Let me make it absolutely clear - I guard my integrity most dearly," Ms Palaszczuk said.

"I want to put beyond any doubt that this is nothing more than an LNP smear."

Ms Palaszczuk said she did not know her partner was working on the Adani project for PwC.

"Shaun has always told me he has worked at PwC, working on infrastructure, and that is it," she said.

Ms Palaszczuk said the "rumours" were a "new low in Australian politics" and trying to allege there was a "massive conflict of interest" in the midst of an election campaign.

"I have done everything by the book, my partner Shaun has done everything by the book," she said.

Ms Palaszczuk said her government had no role to date in the federal government's NAIF loan assessment process for Adani and would now have no role in the future.

To action her decision, she said she would write to Prime Minister Malcolm Turnbull to notify him that her government would exercise its veto to not support the NAIF loan and "remove doubt about any perception of conflict".

"As we are in caretaker mode, a decision like this requires the support of the Opposition Leader (Tim Nicholls)," Ms Palaszczuk said.

"I will be asking Mr Nicholls to endorse my decision."

Ms Palaszczuk said her chief of staff, David Barbagallo, informed her of the rumours on Tuesday night and she then sought advice from the Integrity Commissioner.

The commissioner advised the Premier she should excuse herself from cabinet budget review committee deliberations regarding any NAIF projects.

"I've only just received that advice this afternoon," she said.

The move would not necessarily stop a NAIF loan to the Adani mine, as it could be granted via a different process, but it would remove the state government's involvement.

Ms Palaszczuk said Adani representatives had been on the public record numerous times indicating they did not need NAIF to proceed with the project.

"I want to stress that the NAIF is a federal government initiative, we are not the decision-makers, it's the federal government," she said.

Ms Palaszczuk said she still supported the mine and the jobs it would deliver.

Adani had not yet been informed, at the time Ms Palaszczuk informed the media.

Ms Palaszczuk has been dogged by anti-Adani protesters at the start of her re-election campaign, and the announcement will likely we welcomed by the groups.

Greens candidate for South Brisbane Amy MacMahon said the announcement was "what happens when the the Greens are breathing down the necks of the major parties".

Ms MacMahon called on Labor to cancel Adani's mining lease and royalty deal, and said she was still concerned the NAIF loan could still go ahead through other means.

Comment has been sought from the LNP.

Timeline

• June 16, 2015 - PwC confirms to the Premier that her partner Shaun Drabsch has been recently employed in the company's infrastructure advisory team. PwC assures the Premier her partner will not be involved in any engagements with the Queensland government, its agencies or infrastructure developments as a direct participant.
• July 15, 2015 - Department of Premier and Cabinet director-general writes to the Integrity Commissioner seeking advice on ethics and integrity matters relating to Shaun Drabsch's employment.
• July 17, 2015 - Acting on that request, the Integrity Commissioner advises that based on PwC's undertakings, he sees no reason for the Premier or government to put in place any further measures in anticipation of further conflict.
• April 3, 2016 - Queensland Department of Natural Resources and Mines approves mining leases for Adani's Carmichael project in the Galilee Basin.
• May 2016 - Through his employment with PwC, Shaun Drabsch is engaged as part of a team to work on Adani's application for funding through the Northern Australian Infrastructure Facility.
• December 2016 - Adani submits its NAIF application. PwC continues to be engaged by Adani in regards to its application.
• October 31, 2017 - Mr Barbagallo advises Premier he had verified as part of Mr Drabsch's employment with PwC, he has been working on Adani's NAIF application. The chief of staff's inquiries allegedly occurred as a result of rumours being circulated by LNP senators in Canberra.
• November 1, 2017 - Premier writes to the Integrity Commissioner advising of her awareness of Mr Drabsch's engagement, notifying the Commissioner of her intention to exclude herself from any deliberations, including by the CBRC, in relation to the NAIF application, and seeking the Commissioner's advice regarding the appropriateness of this and any other actions.
• November 2, 2017 - The Integrity Commissioner writes to the DG of the Department of Premier and Cabinet requesting further information.
• November 3, 2017 - The Integrity Commissioner writes to the Premier advising that the preferred course of action was for her to exclude herself from CBRC deliberations regarding any NAIF projects. The Premier announces her intention to write to Opposition Leader Tim Nicholls seeking his agreement to exercise the Queensland government's right of veto over Adani's application for NAIF funding for the Carmichael mine rail line.