Queensland election: Adani royalties agreement ‘removes barnacles’

The Palaszczuk government has signed the long-stalled royalties agreement with Adani over its coalmine project in central Queensland.

Queensland Premier Annastacia Palaszczuk. Picture: Stewart McLean

The Palaszczuk government has signed the long-stalled royalties agreement with Adani over its coalmine project in central Queensland.

Only days out from the beginning of the state election campaign, the Indian conglomerate and Treasurer Cameron Dick have struck a deal over the $2bn mine, expected to go into production next year.

Sources said the new royalties deal was negotiated in haste over the past few weeks amid concerns it would become an issue ahead of the October 31 election, with Labor under threat in several marginal regional seats.

“(Labor) is removing barnacles off the ship before it goes into the campaign,” a source said.

Adani’s Carmichael mine has dominated Queensland politics for the past five years, with Labor’s Left faction leading a cabinet revolt that scuttled an earlier royalties deal — involving a deferred payment schedule — ahead of the 2017 state election.

The Palaszczuk government then withdrew support for a proposed $1bn federal loan for the project’s rail line, across the burgeoning Galilee Basin coal province, and after its re-election demanded new environmental reviews that delayed final approval of the project.

Labor’s poor results in regional Queensland at last year’s federal election were blamed on community outrage over the delays.

After the federal election, Premier Annastacia Palaszczuk ordered the fast-tracking of approvals for the mine, which will initially produce 10 million tonnes a year. Construction of the mine — 780km northwest of Brisbane — began in July.

Mr Dick confirmed the royalties deal was finalised this week but refused to give details of the agreement, which is believed to have retained a deferred payment scheme. “I can confirm the Queensland government has settled terms for a royalty agreement under the resource regional development framework with Adani for its coalmine,’’ he said about the deal, believed to have been agreed to on Wednesday.

Construction work on the controversial mine.

“These terms are consistent with the Resource Regional Development Framework that formed the basis of the royalties agreement with the Century Zinc mine last year, but I can assure you Adani will pay every dollar in royalties they have to pay to the people and taxpayers of Queensland, with interest.

“It is absolutely locked in now, and that is something we have now concluded as a government.”

Asked if he could provide details, he said “No”.

The RRDF was introduced by the state government in May 2017 to encourage development in the northwest minerals province and the Galilee and Surat basins.

It has since emerged that the royalties deal with Century Zinc has not gone ahead, with the company saying the government later changed the “underlying operational requirements ... such that we were unable to proceed with the agreement.”

In 2017, The Australian revealed that the government had struck a deal with Adani that would delay the payment of $360m in coal royalties for five years after it opens and pay interest at the government bond rate.

Late on Thursday, an Adani spokesperson said they were waiting on the government to sign the deal. “We can confirm we have agreed to terms for the royalties agreement and Adani has signed the agreement,’’ he said.

A spokesperson for Mr Dick said the government signed the deal on Thursday evening.