Qld Budget 2022: BHP seeks alliance with ETU to fight royalty hike

In an extraordinary move, one of the world's biggest miners is seeking an unlikely ally to fight Queensland’s mining royalties hike.

One of the world’s biggest miners, BHP, is warning the Queensland Government’s royalty hike will cost regional jobs, with its position being revealed for the first time, as it appeals to the union movement to help push back against the controversial plan.

In an extraordinary move, BHP is seeking an unlikely ally in the Electrical Trades Union.

Brisbane-based BHP Mitsubishi Alliance asset president Mauro Neves has reached out to the head of the ETU in Queensland, Peter Ong, warning that the tax regime will undermine the industry’s ability to deliver jobs.

BHP Mitsubishi Alliance has revealed it will rollout driverless vehicle technology over the next two years at the Goonyella Riverside mine site. Picture: Christian Sprogoe Photography

The State Government has said the move will deliver $1.2 billion in additional revenue for Queenslanders and that it was fair for mining companies to pay more after an unexpected boom in prices recently.

Regional Queensland jobs are most at risk, Mr Neves said in a letter to the union, with the mining executive telling the union the royalty rise was another challenge “to what we are both trying to achieve”.

In the letter Mr Neves sought to open a face-to-face dialogue with the ETU’s state secretary Peter Ong.

The new mining royalties regime kicks in from Friday.

The Courier-Mail has obtained a copy of the letter, which paints a stark picture of BHP Mitsubishi Alliance’s view of the government’s tax rise.

“The bottom line is that the tax increase will undermine our ability to continue to deliver jobs and investment in our industry, especially regional Queensland,” Mr Neves wrote.

He referred to the tax increase making “Queensland the highest royalty regime for coal in the world” which will make it “even more difficult to secure financial capital in an increasingly competitive market”.

BMA operates seven mines in the Bowen Basin, as well as the Hay Point Coal Terminal near Mackay.

While there have been record high coal-prices in recent times, Mr Neves said in the letter there had also been a series of challenges in the past 12 months.

“China export bans, Russia-Ukraine war, and climate impact challenges. This decision on royalty taxes adds one more challenge to what we are both trying to achieve in bargaining,” he wrote.

The ETU's Peter Ong. Photographer: Liam Kidston

He proposed discussions with the union on “alternatives that could deliver a positive impact”, including working with the government on investment opportunities in regional Queensland and extending the Resource Community Infrastructure Fund.

Mr Ong said he had yet to see the correspondence.

Premier Annastacia Palaszczuk has previously defended the move, saying it was “only just” discussions about a royalties tax occur amid record coal prices.

The Budget papers argued the “exceptional surge in coal prices” last year and now meant the state’s current royalty structure did not “provide a fair return to Queenslanders” during boom periods.

Originally published as Qld Budget 2022: BHP seeks alliance with ETU to fight royalty hike