Despite ongoing debate around competitiveness and investment, Queensland’s coal royalty structure continues to place significant pressure on operators and contractors alike. With coal prices easing from previous highs, many in the sector argue the higher royalty tiers are now cutting deeper into margins and influencing long-term investment decisions.
That reality was front and centre at the Bowen Basin Mining Club’s February luncheon, where attendees heard a frank assessment of the situation from BHP Mitsubishi Alliance (BMA) Head of Operations Mariette Bylsma. Mariette leads operations across BMA’s network of metallurgical coal mines, port and rail operations in the Bowen Basin.
“Queensland continues to have one of the highest royalty regimes globally, making our state less competitive and less attractive for future investment,” said Mariette.
“To put it in perspective in FY25 BMA had an effective tax rate of 67%, returned 1% on capital employed, and paid around eight times more in royalties than we made in profit.
“Let me convert this into simple terms – what would your household budget look like if nearly 70 cents in every dollar was paid in tax? If your business rent went up to eight times what you make in profit, would you keep operating?”
Speaking to the 220 people in the room, Mariette called on attendees to add their voices to initiatives such as the Resource Industry Network’s Regions before Royalties campaign, emphasising that every voice matters in advocating for a fairer outcome.
“That petition calls for fairer, more competitive royalty settings for Queensland because sustainable investment means sustainable jobs, local business and thriving regions.
“The facts don’t lie. Queensland remains one of the highest coal royalty jurisdictions in the world – nearly four times the global average for metallurgical coal.
“And we don’t have to look too far for a stark contrast. Just over the border in NSW the maximum royalty rate is 10.8%. By comparison, it’s 40% here in Queensland.”
Mariette also pointed out that when the NSW Government proposed changes to its coal royalty rates, they took the time to engage with industry and sought to understand the impact these changes would have.
“The engagement was respectful with a focus on mutual understanding and collaboration. The outcome struck a balance between public needs and what was required to keep industry and NSW competitive.
“The lack of engagement with industry in Queensland has meant that BHP has had other opportunities to invest for better returns and lower risk elsewhere around the world and in other states like Western Australia and South Australia.
“And while the current settings – and indeed the challenge we all now facing – were imposed by the previous Government, we would argue it’s the current Government’s problem to solve. And we’re calling on the Crisafulli Government to do just that. We also encourage everyone to do the same and signing the Resource Industry Network’s petition is a great place to start.”
Bowen Basin Mining Club Director Jodie Currie said the frank discussion reflected the critical juncture facing Queensland’s mining sector.
“The people attending our luncheons represent the full mining value chain – from major producers to contractors, suppliers and service providers. When Mariette talks about needing competitive policy settings to secure investment, that message resonates across every business that depends on a strong mining sector.
“Queensland has world-class resources and world-class people. Now we need to look towards future policy settings that allow the industry to thrive and continue driving economic prosperity for Queensland and its communities.”
| To find out more to sign the Resource Industry Network’s petition head to: www.regionsbeforeroyalties.com.au |
Image caption: Bowen Basin Mining Club Director Jodie Currie and BHP Mitsubishi Alliance (BMA) Head of Operations Mariette Bylsma.
