Queensland Government dismisses Adani’s ‘royalty holiday’

The Queensland Government has unveiled a new resources policy on royalties, which will require Adani to pay all of its royalties for the Carmichael mine.

The policy focuses on development in the Galilee and Surat Basins and the North West Minerals Province, and generating employment and business opportunities in those areas

Under it, all approved greenfield projects will pay all royalties due to the state over the term of any agreement, with security of payment and no adverse budget impact to the state; any agreement with a company will not involve the direct expenditure of public funds in the project or in directly-related economic infrastructure for that project; and the company must provide a third party infrastructure or other acceptable economic infrastructure to the state.

The projects must also have significant regional employment, generate royalties and provide economic benefits to the state.

Queensland treasurer Curtis Pitt said the policy will apply to future resources developments proposals, replacing the ad hoc arrangements that were negotiated in the past.

“It is a transparent policy framework that will apply equally to project proponents looking to invest in these under-developed resource regions,” he said.

Queensland premier Annastacia Palaszczuk said the state cabinet unanimously agreed to the new policy approach for the three regions, and emphasised that Adani will have to pay all of its royalties.

“Under this new policy, the Adani Carmichael mine will pay every cent of royalties in full,” Palaszczuk said.

“There will be no royalty holiday for the Adani Carmichael mine.”

This comes after reports that Adani would receive a “royalty holiday” for the Carmichael project, to be developed in the Galilee Basin, which would see Queensland lose around $300 million in royalties.

Adani recently delayed its final investment decision in the $21.6 billion project, creating uncertainty over its development.

Deputy premier Jackie Trad said under the new policy, all royalties will be paid, and if they are deferred, will be paid with interest and with security of payment in place.

“There will be a new financial assurance model that ensures operators comply with environmental conditions and cover rehabilitation costs,” she added.

To keep up to date with Australian Mining, subscribe to our free email newsletters delivered straight to your inbox. Click here.