Media release: Adani could get free coal costing Qld budget as much as $1.2 billion
Following media report that the Queensland Government and Adani are negotiating a discount on the royalties the company would pay to extract the state/s coal resources, The Australia Institute has calculated the potential cost of a 'roylaty holiday' to the taxpayer.
The Courier Mail reported that the government and Adani working on this deal:
Premier Annastacia Palaszczuk on Saturday spoke with Mr Adani by phone and held a brief one-on-one meeting, discussing the structure of state royalties. Both parties are said to be comfortable with the royalty arrangements being thrashed out.
This negotiation echoes the Newman Government royalty holiday, which outlined:
A ramp-up to full royalty for an initial period, on the normal coal royalty payable and based on a sliding scale.
If the Palaszczuk Government settles on a royalty holiday similar to that used earlier by the NSW government, The Australia Institute has calculated the cost to Queenslanders will be $1,159 million in lost revenue. This policy would give Adani free coal for five years and discounted coal for another four.
The Australia Institute has submitted a Right-to-Information request on the royalty deal.
“If the deal, which ‘both parties are comfortable with’ is the kind of royalty holiday that we’ve seen before in NSW, it will gift Adani over $1 billion in free coal,” said Research Director Rod Campbell.
“The economic case for Adani’s mine keeps getting worse. Taxpayer-subsidised loans, free water and now the Premier is in secret discussions to give away the state’s coal.”
The Adani project and government assistance:
- 50,000 megalitres of free groundwater annually, worth $100 million over the life of the project
- $900 million dollar concessional loan to build a coal-only railway to the mine
“Like giving lollies to one child at a party, the problem with giving Adani free coal is that all the others will want some. It won’t take other miners in Queensland and NSW long to work out that they are missing out on Adani’s subsidies,” Campbell said.
Media Contact: Tom Burmester – 0468 926 833