This month there is only one story on our news page and it is the one that has been taking over the headlines in Queensland – royalties.

Across the state, there has been a big dispute brewing between the coal industry and the state government, all centered on royalty rates – basically the share the government takes when coal is sold.

In 2022, after about a decade of nearly frozen royalty rates, the government introduced a progressive tiered royalty system which industry groups say was implemented without adequate consultation.

Basically, the higher the price of coal per tonne, the higher the percentage royalty companies must pay.

Under the scheme, mining companies pay 20% for coal prices above $175 per tonne, 30% for prices above $225 per tonne and 40% for prices above $300 per tonne. The rates are well above comparable states, for example, New South Wales has a top coal royalty rate of 10.8%.

According to the Minerals Council of Australia, the 2022 royalty changes contributed to Queensland’s royalty revenue increasing from $7.7 billion in 2021–22 to $14.8 billion in 2022–23, while production volumes were broadly stable. Queensland’s share of national royalty payments rose from 32.5% to 47.2% in the same period. Revenue has since declined as coal prices have fallen.

The royalties were reaffirmed in September 2024, when the Queensland Government passed the Progressive Coal Royalty Protection (Keep it in the Bank) Bill 2024, amending the Mineral Resources Act 1989. The legislation introduced a coal royalty rate floor, meaning progressive coal royalties cannot be reduced or amended without prior approval from the Queensland Parliament.

The state government argues this system is fair because it ensures Queenslanders benefit when coal prices are high – funding for hospitals, schools, regional infrastructure and more.

On the other side, coal companies and industry groups say the rates are now too high and are not sustainable.

They warn that the high royalty burden makes operations less viable. They argue it hurts investment, forces layoffs, threatens mine closures and makes Queensland less competitive internationally.

Last month, companies including BHP Mitsubishi Alliance (BMA), Anglo American and QCoal announced full or partial closures of several coal mines, with more than 1,000 jobs affected. This follows Bowen Coking Coal going into administration at the end of July.

All these companies cited high royalties and falling coal prices as part of the reason for cutting jobs and suspending operations.

As of now, the government has stood firm: no rollback on the royalty structure is planned during its current term despite industry pressing for reform. The government maintains the system provides stability, fiscal benefit, and that Queenslanders have a stake in keeping it.

Speaking in parliament, Premier David Crisafulli acknowledged that the previous government had created uncertainty by setting mining taxes without consultation but insisted Queensland remains a safe place for resources sector investment saying, “Our government is working to restore confidence in our resources industry. The days of the government at war with the industry are over”.

With companies pointing to closures, job losses and diminished competitiveness, and the government holding firm on its revenue stance, it may not resemble open warfare, but it is far from peace. The debate over royalties continues to play out like a protracted standoff, with both sides claiming to act in Queensland’s best interests.

There is also a secondary issue that often gets lost amid the industry-government standoff: the people who actually live in coal-producing regions.

Historically, coal mining communities in Queensland have expressed concerns about receiving a fair share of the revenue generated from coal royalties. While the state has implemented various funding initiatives, these communities argue the allocations are insufficient relative to the economic contributions they make and local leaders have long advocated for a better return of coal royalties to support essential services such as housing, health and critical infrastructure

The impact of extracting revenue without reinvestment is clear. When Glencore wound down operations at its Newlands mine, Glenden’s future hung in the balance, saved only by a determined community campaign. Drive along the Bruce Highway and the need for upgraded infrastructure is impossible to miss – literally – have you seen those potholes!

These communities rely heavily on coal mining for employment and local economic activity, and as mines close or scale back, their future becomes uncertain. In effect, they are the ones putting the money into government coffers yet often see little returned to sustain their towns.

There are plenty of loud voices in the debate and some of those perspectives you will hear from on the following pages. But you may also hear viewpoints from people not always recognised as affected.

As for @ The Coalface’s opinion? Let’s leave you with an analogy.

In the late 1960s and early 70s, psychologists at Stanford University ran what became known as the marshmallow experiment. Children were offered a treat and told they could eat it immediately or wait until the researcher returned to receive a second treat. Some ate the treat right away, while others waited.

Years later, researchers followed the children into adolescence and adulthood and found that those who delayed gratification often had better outcomes, including academic performance and other measures of personal development. The study became a well-known illustration of patience and self-control: sometimes waiting for a bigger reward can lead to better outcomes in the long run.