Resource royalty uncertainty risks mine projects, jobs at a time of high Qld unemployment

A survey of Queensland resource companies has found an overwhelming majority of company chief executive officers believe their projects and the creation of thousands of jobs from those projects would be less likely to proceed if the Palaszczuk Government changes the rate of royalties.

Queensland Resources Council Chief Executive Ian Macfarlane said when asked if royalty uncertainty affected the likelihood of Queensland projects proceeding, 77% of respondents agreed.

“The Palaszczuk Government has a lot to thank the resources industry for when it comes to jobs. Our sector continues to do the heavy lifting with employment generating a new job every 57 minutes since the Queensland election in November 2017. Why anyone would want to stop the clock on this strong job creation by creating uncertainty in the resources industry is impossible to understand?”

“That is why the QRC and the CFMEU have jointly called on the Palaszczuk Government to rule out changes to royalties. To date, the Palaszczuk Government has refused to provide that certainty.”

“There could not be a worse time to create uncertainty for investment in Queensland. The State’s unemployment rate is now 5.9 percent and Queensland is the leader in unemployment on the east coast when it can and should be a leader in job creation.

“Queensland added 5,219 jobs in April with the resources sector contributing around 1 in 4 of those jobs or 25 percent after creating 10,000 new jobs in 2018.

Mr Macfarlane said the Palaszczuk Government was already receiving record royalty revenue, expected to receive $5.3 billion in 2018-19.

“There is a pipeline of more than $60 billion in resource projects across Queensland.”

“The Palaszczuk Government should be encouraging these projects through to development. The threat of changing the rate of royalties – already among the world’s highest – will only discourage investment and discourage employment in Queensland.”

“The world is watching Queensland. In February, an international survey found Queensland was less attractive to investors compared to other mining regions around the world.”

“If the resources sector loses this investment in new projects, it’s Queensland that loses. Queenslanders lose the opportunities for more jobs, more exports and ironically more royalties.”

Mr Macfarlane said to reinforce the point, the QRC survey also found that more than 85% of companies responded that Queensland would be more attractive for investment if royalty rates were fixed for the life of the project.

Earlier this week, the Palaszczuk Government announced the approval of the environmental impact statement (EIS) for the Olive Downs metallurgical project in central Queensland. Over its 79-year life, the project is estimated to return a massive $5.6 billion in coal royalties.

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