Mining firms hit hard by Budget

THE Newman Government has been accused of using the mining sector as a "bottomless pit" after raising coal royalties in yesterday's state budget.

Coal mining companies operating in the Bowen Basin are set to be taxed the highest in Australia with industry groups fearing job cuts and mining projects will be abandoned and moved offshore.

Treasurer Tim Nicholls said Queenslanders deserved more from the resources sector, increasing royalty rates increase to 12.5% for coal valued between $100 and $150 a tonne, and rise to 15% if the price rises higher.

Queensland Resources Council chief executive Michael Roche was blindsided saying the rise is effectively 25% more in royalties for coal priced $100 a tonne, rising to 50% for coal priced $150 a ton.

"Of all the coal regions, the Bowen basin is the one that will bear the huge burden of the royalty increases," he said.

"Today's announcement of a coal royalty increase is worse than ever feared, it means job losses, it risks further mine closures and there are many coal projects which will never get off the drawing board."

The royalty rise will net the state $1.6 billion over the next four years, Mr Nicholls said.

Mr Roche said the rise would hurt coal mining cities in central Queensland.

"The knock-on consequences for decisions to put more projects on hold as a result of the royalty increase will flow on to decisions around port and rail infrastructure, for dams," he said.

"That's going to cost jobs as well.

"The areas that are the heartland for coking coal around Moranbah, Mackay but right through central Queensland, anywhere where you are producing coking coal for every dollar above $100 you are paying 25% more."

Along with the royalty rise, Mr Nicholls unveiled a cabinet committee aiming to cut red tape and reduce approval times for new mines.

Smaller "farm-in" miners have been relieved of transfer duty, costing the government $5 million.

"This will reduce costs and help ensure projects are up and running, employing Queenslanders and contributing to our economy."

Mr Roche said the new committee should meet weekly to ensure those promises are kept.

"We have a long list to take to that committee and we expect action over the next 100 days to seriously address cost issues and production issues in our industry that can be addressed by government policy, legislation and regulation."

Mining and Exploration Companies regional manager Bernie Hogan said the royalty rise came as no great surprise.

"It's never a good time to have additional costs to miners, especially our members being mid-tier miners and exploration companies, particularly in a time now when there is a drop off in the international prices, it's never good to see that," he said.

Topics:  mining queensland budget 2012

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