The Queensland Resources Council (QRC) said today that Glencore‘s decision to withdraw from plans to develop a $2 billion coal mine south-west of Emerald is a portent of things to come following the Queensland Government‘s decision to impose unreasonable new royalty charges on coal producers.
Glencore’s Valeria project, located south-west of Emerald, was expected to provide 1400 construction jobs and 1250 operational jobs over 37 years.
QRC Chief Executive Ian Macfarlane stated that Glencore stated that the Queensland Government’s royalty increase played a role in its decision to discontinue the project.
“Companies take into account a broad range of factors when considering multi-decade, large-scale investments in projects like this, and regulatory stability is one of those factors,” Macfarlane said.
According to Macfarlane, Glencore has stated that ‘abrupt decisions like the Queensland super royalty hike have damaged investor confidence, increased uncertainty and raised a red flag with key trading partners’, which is consistent with the QRC’s position from the start – this royalty hike will affect long-term investment in Queensland.
Previous Queensland governments, according to Macfarlane, have provided stable and consistent investment environments for resource projects, but this is no longer the case in Queensland.
“The Queensland Government does not appear to appreciate the impact of its decision to lift coal royalty taxes to the highest rates in the world,” Macfarlane said.
Macfarlane stated that short-term political actions like this make it more difficult for corporations to invest here and send a signal that they should move their focus to other locations that offer higher returns to investors.
Macfarlane added that the QRC has frequently cautioned the government of the long-term consequences of its choice to over-tax coal producers on investment in all resource projects, not just coal. He added that their worries have unfortunately gone unheeded.
“We now have a situation where major mining companies such as BHP, Peabody and Glencore are rethinking their investment plans for Queensland, which means every Queenslander loses out in terms of new jobs and business opportunities and the flow-on benefits from that,” Macfarlane stated.
Macfarlane added: “Japan’s Ambassador to Australia Yamagami Shingo has also made it clear the relationship between Queensland and Japan has been damaged by the way in which the royalties were unilaterally introduced, without any consultation with industry or investors.”
According to Macfarlane, sudden changes in investment restrictions discourage investors from investing in future job-creating projects, which should be a primary concern for any government.
Macfarlane stated that the QRC would continue to be open to engaging with the government to seek a more balanced strategy to assist the Queensland economy without jeopardising the industry’s future.
 said today that Glencore's decision to withdraw from plans to develop a $2 billion coal mine south-west of Emerald is a portent of things to come following the Queensland Government's decision to impose unreasonable new royalty charges on coal producers.){kind=link}