Bowen Coking Coal restarts Burton mine with 500 new jobs for Central Qld

The executive chairman of Bowen Coking Coal says the state government displays Venezuela-esque levels of mismanagement, but he’s betting big on coal, restarting mines and creating jobs.

Bowen Coking Coal executive chairman Nick Jorss. Picture: Zoe Devenport

After the imposition of the state government’s new coal royalties in June last year, Bowen Coking Coal boss Nick Jorss said at the time he went to sleep in Queensland and “woke up in Argentina”.

Now, nearly a year later, he thinks he didn’t go far enough.

“Maybe I should have used another example, like Venezuela, or another dictatorship,” he said.

“We are not in Kansas, that’s for sure.”

Coal companies are still fuming about the shock budget move from Treasurer Cameron Dick, which sharply increased royalties as coal prices move upwards.

Coal firms now pay 40 per cent on the dollar when prices go above $300 a tonne, the highest rate in the world.

Data from the Office of the Chief Economist’s quarterly report predicts the new regime will inject an additional $5bn into the government’s coffers this financial year instead of the $800m originally forecast.

Bowen Coking Coal has created some 500 jobs reopening the Burton complex, which is expected to produce up to 4.5Mt of primarily steelmaking coal for export when it reaches full capacity. Picture: Zoe Devenport

“You talk about Venezuela and Argentina, you are not seeing royalty regimes like that in any other jurisdiction,” Mr Jorss said.

But the coal baron, speaking before BCB’s reopening of the Burton mine west of Mackay this week, expressed a tension rippling through the sector: He decries the new regime and sees it as a threat to the viability of the sector, but he is also betting big on Queensland coal and ploughing ahead with new projects.

Alongside the restarted Bluff mine near the Capricorn Highway, the ASX-listed company is now digging and shipping coal from its Broadmeadow East holding, ramping up production at Burton and confident about its other prospects such as Isaac River and Carborough.

“We are still planning to crack on with these (projects) and we are excited about all of that,” he said.

“We are all optimistic we will be in a strong coal market.”

Mining majors like BHP are also sending mixed signals.

Bowen Coking Coal executive chairman Nick Jorss. Picture: Zoe Devenport

The behemoth has stated bluntly it will shut down further investment into Queensland in response to the royalties, but it is also bullish long-term on its high-quality metallurgical coal operations such as Peak Downs and Goonyella.

“The Queensland coal industry does have a strong fundamental future, but we have to get the policy settings right and that assumes we don’t kill it with over-regulation and taxes,” Mr Jorss said.

“There will be downturns and in the downturns mines will shut and that will cost jobs.

“You have got to set yourself up with a sustainable model through the cycle.”

Mr Dick confirmed this afternoon he would not reconsider his position.

“The government is satisfied with the impact and effect of coal royalties, with high prices delivering strong returns to both coal companies and the people of Queensland,” he said.

“The coal mining lobby’s $40m campaign against fair royalties will not have any impact on the government’s position.”

BCB has created some 500 jobs reopening Burton, which is expected to produce 4.5Mt of primarily steelmaking coal for export when it reaches full capacity.

The company will celebrate its reopening today alongside leading figures from the resources sector and political representatives such as Kennedy MP Bob Katter and Nationals Senator Susan McDonald.