Australia’s largest coal producer has been approved to clear 136 hectares of koala habitat by the Queensland government.
But mining giant BHP Mitsubishi Alliance (BMA) says it is walking away from its central Queensland project because the state’s coal royalties are too high.
The Saraji East mining project proposed in the Bowen Basin south-west of Mackay was granted conditional approval by Queensland’s environment department this week.
The mine expansion would still need federal government approval.
But the mining giant issued a statement which said it would not invest in any expansion or growth of operations in the state.
BMA will require federal environmental approvals for the project. (ABC South West: Anthony Pancia)
A spokesperson said that was because Queensland had an “unsustainable royalty regime”.
Queensland’s coal royalties’ scheme – which has brought billions into state coffers – works on a sliding scale starting from a rate of 7 per cent when coal prices are below $100 per tonne to a peak of 40 per cent when prices are over $300/t.
The system was introduced by the previous state government at a time when coal prices were at a record high, but prices have dropped since.
In September, BMA cut 750 jobs in the Bowen Basin and suspended its Saraji South mine blaming the royalty scheme and low coal prices.
The Saraji South mine was shut by owners BMA in November. (ABC Rural: Kim Honan)
A spokesperson for Natural Resources and Mines Minister Dale Last said the government was not considering a change to royalties.
Habitat at risk
The Saraji East mine expansion, first proposed in 2013, was expected to create 1,000 construction jobs and 500 ongoing positions over the mine’s more than 20-year life span.
The environmental impact statement (EIS) found that the project site would clear 136 hectares of koala habitat and significantly impact 33.55 hectares supporting greater glider populations.
The Queensland Department of Environment ordered BMA to offset the losses of habitat with conservation efforts.
More than 130 hectares of koala habitat was going to be cleared if the mine extension proceeded. (ABC News: Brendan Esposito)
It also requested more evidence about how it would be able to offset 18 million metric tonnes of direct greenhouse gas emissions from the project over its life span.
Conservation group, Lock the Gate Alliance, said Queensland needed to prioritise renewable energy over coal mines.
“Regional Queenslanders need a plan for the future that puts them in the driver’s seat and embraces the opportunities of the energy transition,” said Lock the Gate Alliance Queensland coordinator Maggie McKeown.
“They don’t need more polluting coal mines that prioritise corporate profits over communities while fuelling climate change that is destroying what we love most about our beautiful state.”
Fears overstated
The state environmental approval for Saraji East comes within days of Chinese-backed company Yancoal pushing to extend the life of its Yarrabee coal mine to 2070.
That is despite grave warnings from industry figures about an investment slowdown in Queensland’s coal sector.
BHP sacked 750 workers across its Brisbane and Bowen Basin operations in September. (ABC News: Donna Field)
Minelife senior resources analyst Gavin Wendt said the industry had clearly been pressuring the state government.
“We’re talking about a relatively recent history here of companies going public with respect to not only their opposition to the coal royalties, but also with firm decisions mothballing or closing operations,” Mr Wendt said.
He said companies want certainty and security about the future of projects.
“They want to know they can make decisions with regards to long-term planning on these significant investments and know they have a strong operational life ahead of them.”