Qld coal needs confidence

QUEENSLAND’s ambitious exploration program is commendable but will count for nothing if potential investors in coal mining projects do not have confidence to invest in the state.
Qld coal needs confidence Qld coal needs confidence Qld coal needs confidence Qld coal needs confidence Qld coal needs confidence

For this reason, Hogsback found it disturbing the state had lost ground in the latest global survey of mining companies and investors, falling two places to number 15 in the world for investment attractiveness.

The Fraser Institute Annual Survey of Mining Companies sent a clear message that Queensland could not become complacent in a field of intense global competition.

Queensland Resources Council CEO Ian Macfarlane reckons the survey shows Queensland's resources "superpower" cannot be taken for granted.

"World class and abundant mineral resources are not enough," he said.

"These results show that Queensland must work harder to attract international investment in the projects that create jobs and support regional communities."

Queensland is well clear of both Victoria, at 43 and New South Wales at 47. However, Queensland should be looking at the survey leader, Western Australia or even South Australia at 6 and Northern Territory at 13 for inspiration.

Exploration is the lifeblood of the coal mining industry. Cut this off and you can expect the industry to come to a spluttering halt down the track.

The 2020 Queensland Exploration Program will open more than 7000 square kilometres of land for coal as well as gas and petroleum exploration.

Queensland mines minister Dr Anthony Lynham said the Queensland exploration program brought the next wave of resources investment and gave advance notice to landholders about potential resources activity in their areas.

This may be true, however, there are worrying signs from Lynham's cabinet colleague treasurer Jackie Trad that the Queensland government may be ready to upset the apple cart by hiking coal royalties.

The Queensland government is considering increasing coal mining royalties to pay for a deficit caused by the coronavirus and government overspending.

Queensland government expenses have increased 11% in the past two years, while revenue has grown 6%.

Mining companies paid $4.4 billion in coal royalties to the state government during 2018-19.

Trad is under pressure to increase royalties in the April 28 budget for the first time in eight years.

Hogsback reckons you cannot expect mining companies to commit to long-term exploration projects when the political climate is so uncertain.

It would be to the detriment of the coal industry's future if investors were spooked by rash decisions from state governments wanting to hike coal royalties to paper over their overspending.