The cash-strapped state government this week surprised the industry by announcing it would lift the royalty rate for coal sold above $100 per tonne by 25% and would introduce a levy of 15% once the price hit $150/t – effectively a 50% increase.
It will rake in $1.6 billion over the next four years with the new measures.
Nasser defended the quality of resource companies from claims by Premier Campbell Newman that bad management was the cause of the recently announced mine closures and job losses and asked that governments stop using mining as a cash cow.
“If I look at the top team of BHP Billiton and with respect to all of the other natural resources companies around the world, I wouldn’t swap that team for any other team and that says something,” he told an Australian Financial Review seminar yesterday.
“We’re prepared to take the risk. To me, [governments] want to take the upside and want someone else to take the downside.
“They wanted to take out a shotgun and shoot some of the best athletes in the left foot.
“Now why would they want to do that when you have got an industry that could be globally competitive, that can generate so much flow-on research, investment, employment, really good-paying jobs and it’s sustainable over decades?”
Last month BHP said it would shelve its planned 2.5 million tonne per annum expansion of the Peak Downs mine in Queensland but would continue with the Caval Ridge project as it sought to ramp up overall production by 50% by 2014.
BHP chief executive Marius Kloppers said at the time: "In reality what we are talking about is just slowing the rate of [capital expenditure] growth going forward."
Nasser said the royalty increase was negative in the short term because it meant jobs would be lost and production would be slowed down or cease.
“In the long term, it reintroduces this level of uncertainty for long-term investments,” he said.
“At the moment, no change in taxation policy in Australia is a good change because it seems to me every time they change it is to the detriment of industry and economic growth.”
Nasser said governments needed to take a long-term view to working with resources companies over the duration of its growth cycle.
“There has to be a recognition that you invest for 20, 30, 40, 50 years and you would like to believe that there is a partnership and yes, things will go up, things will go down and there is no such thing as 100 per cent certainty,” he said.
“And I think maybe going through what we are going through now is a wake-up call to everybody – including people in the industry – that God didn’t intend for this to stay this way forever.
“It is a cyclical industry in a cyclical global economy.
“I don’t know whether we’ve reached the bottom of the cycle from a commodity viewpoint. We don’t try and pick cycles. They’re very difficult to pick.
“What we try and do is look at the long term and we feel very good about the long-term demand.”