The Palaszczuk Government would secure an extra $5 billion in coal royalties for all Queenslanders, from the Olive Downs mine near Moranbah in central Queensland it approved today, if it maintained royalty rates at current levels.
Queensland Resources Council Chief Executive Ian Macfarlane said the approved Environmental Impact Statement (EIS) for Olive Downs metallurgical coal mine project would generate royalties over the 79-year life of mine worth $5.685 billion (or $1.117 billion at present value), in addition to creating 500 jobs in construction and 1000 jobs once the mine is operational.
To put the projected royalties windfall into context, the Government has estimated the cost of its priority infrastructure project, Cross River Rail in south-east Queensland, to cost $5.4 billion.
"On behalf of the 315,000 Queenslanders already working in the resources industry across the State, we welcome the Palaszczuk Government's decision to approve the EIS for Olive Downs," he said.
"At a time when Queensland's unemployment rate is increasing and it is among Australia's highest, the approval of Olive Downs coal project is a commitment of confidence amid attacks and threats of increased tax on coal."
"At a time when there are calls for Queensland mine workers to reskill, the industry is creating jobs and has more than 1000 vacancies to fill."
Mr Macfarlane said QRC has already projected coal royalties would be a record $4.46 billion this financial year (2018-19).
"The approval of projects like Olive Downs provides the opportunity for more jobs, more exports and more royalties for Queenslanders," he said.
"Increasing royalty rates increases uncertainty. Uncertainty undermines confidence, undermines jobs, undermines exports and undermines future royalty payments."
The economic assessment report for Olive Downs states that:
"the Project would generate total royalties of $5,685M ($1,117M present value at 7% discount rate). Royalties were calculated as per the the following Government royalty rate per tonne of product coal:
• First $100/t - 7% of value
• Next $50/t - 12.5% of value
• Balance - 15% of value"
