NSW coal royalties have contributed less to the state than the government had expected, dropping by approximately $270 million in this year’s state budget.
The royalty income generated $1.161 billion compared to $1.431 billion the same time last year.
The budget papers, released on Tuesday, attribute the drop in royalty income to “weaker US dollar coal prices and slower growth in exports, partly offset by a lower Australian US dollar exchange rate”, a report by the Newcastle Herald states.
It went on to say, “Royalties in the four years to 2018-19 are now expected to be around $1.7 billion less than in the 2015-16 Budget, largely due to lower US dollar coal prices and a reduction in coal exports.”
Over the last three years, benchmark prices for thermal coal have fallen to around $US55 a tonne in 2016/17 compared to last year’s estimated $US70 per tonne.
The state is now estimating royalty revenues of $1.34 billion in 2017/18 and $1.41 billion in 2018/19.
Queensland’s state budget upheld a commitment not to raise royalties but has not provided funding for geo-science programs and exploration, in contrast to Western Australia’s budget which announced $30 million in funding for the Exploration Incentive Scheme.