BHP slams Queensland investment regime; seeks dialogue with new LNP government

The boss of global mining giant BHP has slammed Queensland as an unattractive investment destination compared with jurisdictions such as Chile and Canada.--

BHP has put new Queensland Premier David Crisafulli on notice.

The boss of BHP has criticised Queensland as an investment ­destination, putting newly elected Premier David Crisafulli on notice that the mining giant will seek changes to the former Labor ­government’s super-profits coal royalties scheme.

BHP chief executive Mike Henry said the company would lobby the new LNP government to get a better deal for the mining sector. Mr Henry warned that his ­priority was returns to BHP shareholders and that the Palaszczuk-Miles ­government’s unheralded hikes had made competing ­resource-rich jurisdictions such as Chile and Canada far more ­attractive for future investment.

“The reality is that BHP is a global business and we have a responsibility to our shareholders to seek the best return” Mr Henry said on the sidelines of the company’s annual general meeting in Brisbane on Wednesday.

“What we’re seeing in Queensland right now does not make ­investments attractive for us, relative to the opportunities we have in Chile, Canada, some of the states in Australia and elsewhere.”

Former Labor treasurer Cameron Dick raised coal royalty rates in his 2022 budget following a ­decade-long freeze, after promising no new or increased taxes ­during the 2020 state election campaign. “We were disappointed in the way the authorities rolled out (the royalties regime) previously, and there was a real compare and contrast between what happened here versus what happened in Chile,” Mr Henry said.

“But we see this as being an anomaly rather than the norm, which is one of the reasons we were so strong in putting our views at the time.”

The three-tier coal royalty scheme, which includes the highest taxing rates in the world – with a top tier of 40 per cent for prices above $300 a tonne – delivered an extra $9.4bn to state coffers from 2022 until the last budget in June.

In May, this year the scheme was enshrined in law, with the support of Mr Crisafulli and the LNP. A vote in parliament will now be required to change the coal royalty rates.

Mr Crisafulli has previously vowed not to make changes to royalty rates for at least four years because revenue has already been committed across the budget’s forward estimates, but he has refused to rule out axing the regime after mid-2027.

In the past two years, the ­resources sector has spent millions of dollars in advertising ­attacking the coal royalty hikes, describing them as a cash grab that will stifle the state’s ability to attract new investment.

BHP Mitsubishi Alliance, a joint venture between BHP and Mitsubishi Development, operates five coal mines in the Bowen Basin.

BHP chief executive Mike Henry at the company’s AGM in Brisbane

BHP chairman Ken MacKenzie said the company worked cooperatively and collaboratively with “governments of the day” and was “looking forward” to engaging with the LNP government.

Mr Henry said that despite a push to raise copper royalties in Chile, where BHP operates some of the world’s biggest copper mines, its government sought to engage industry, and struck a balance between public needs and what was required to keep industry and the country competitive.

“Our approach to them (the new LNP government) will be the same as many other approaches to government,” Mr Henry said.

“We will seek to work together with them, make sure that they are well informed, and understand BHP and industry’s perspective and what changes could elicit more by way of investment attractions. Our position is agnostic of government. I’m sure that governments over time will look at how they go about attracting more investment into the state, or into the country, and you would expect policies to evolve in response to that.”

Mr Henry would not be drawn on whether the company had met any members of the incoming Queensland government.

Climate change protesters from Lock the Gate Alliance hold a small rally outside BHP’s annual general meeting

Originally published as BHP slams Queensland investment regime; seeks dialogue with new LNP government