Treasurer reveals blocked gold mine’s $200m NSW budget hit

Daniel Mookhey says a gold mine blocked by Tanya Plibersek should go ahead, but has stopped short of backing a disallowance motion, saying it’s not a matter for the NSW government.

NSW Treasurer Daniel Mookhey. Picture: Newswire / Gaye Gerard

Treasurer Daniel Mookhey has revealed the NSW government will lose a potential $200 million in royalties if the McPhillamys Gold Mine project in Blayney does not go ahead, but stopped short of supporting a disallowance motion in the Senate.

Under questioning from opposition upper house leader Damien Tudehope during a Budget Estimates hearing on Thursday, Mr Mookhey said royalties would not be paid until the mine was operational.

However, he confirmed Regis had expected to be paying $200 million to the government once the mine was up and running.

“And so it’s fair to say that the royalties assumptions that are contained within the budget are reflective of the expected extractions of operating mines over the next four years,” he said.

“The applicant has made the point that, should such a mine operate, they expect to be paying circa $200 million in royalties.

The area in the gold mine proposal that has been opposed to put a tailings dam due to it being of cultural significance. Picture: Rohan Kelly

“Given the mine has not got approval to proceed, as is in respect to its tailing dams, the impact on the economy spans the impact in the construction phase, the operational phase, the export phase, as well as an impact on the state’s royalties income.”

Mr Mookhey told the hearing that he supported the expansion of gold-mining “so long as it’s done in accordance with the law”, and that he agreed with Premier Chris Minns that the mine should be proceeding.

The entrance to McPhillamys Gold Project, Regis Resources Limited. The entrance pictured on Dungeon Road Kings Plains. Picture: Rohan Kelly

But grilled on why he would not be supporting a disallowance motion, Mr Mookhey said it was not a matter for the NSW government.

Instead, the government would continue to engage with the proponent to determine whether there was an alternative solution to the tailings dam, he said.

“I’ll leave the Senate to its own deliberations,” he said.

“We’re getting the balance right between being clear about where we think the federal government could do better, but equally taking our responsibility to ensure that the practical steps that we can take are indeed undertaken.

“I think we’ve made our view crystal clear. I think the premier has been and the Minister for Natural Resources and the other ministers who are responsible from the New South Wales Government matter in this respect, have been very clear about what the New South Wales government’s position is on (the mine).”