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Queensland Coal Producers Feel the Pinch of Rising Royalty Taxes

Australian coal producers, particularly those operating in Queensland, are facing a significant financial squeeze due to recently implemented higher royalty taxes. These taxes, combined with other cost pressures, are impacting profitability and investment decisions.

Key Points:

  • BHP:
    • Queensland coal division earnings slumped 63% despite stable coal prices.
    • Higher royalty taxes blamed for the decline, with an effective tax rate of 62%.
    • Unit costs for Queensland met coal operations rose 29% due to various factors.
  • Coronado Global Resources:
    • Net income after taxes fell 79.8% due to high costs, royalties, and weather events.
    • CEO Douglas Thompson cited these challenges in the financial report.
  • TerraCom:
    • Royalty per tonne saw a significant increase compared to FY 2022.
    • Report highlights the impact of higher royalty rates.
  • Bowen Coking Coal:
    • Requested deferral of royalty payments due to financial strain.
    • This exemplifies the difficulties faced by some producers.
  • Industry Concerns:
    • Queensland Resources Council (QRC) criticizes excessive taxation.
    • Warns of negative impacts on investment, jobs, and the state economy.
    • Highlights government data showing higher than expected tax revenue.
    • Predicts total coal royalties to reach $12.8bn, exceeding initial estimates.


  • Reduced profitability: Higher royalties directly impact producer income.
  • Investment slowdown: BHP and others have reduced investment in Queensland.
  • Job losses: Potential negative impact on employment in the sector.
  • Economic slowdown: Reduced investment could affect the overall state economy.

Looking Forward:

  • The debate between government revenue generation and industry sustainability continues.
  • Potential for further adjustments to royalty rates or other policies impacting the sector.
  • The long-term impact on Queensland’s coal industry and economy remains to be seen.

Source: TheCoalTrader, AI generated