Bob Katter warns mining giant Glencore’s $600m taxpayer funded lifeline is a ‘band-aid on a compound fracture’
Maverick MP Bob Katter has issued a stark warning over a $600m joint state and federal lifeline to mining giant Glencore that allowed for 17,000 Queensland jobs to be saved.
More than 17,000 Queensland jobs have been saved and half of Australia’s copper smelting capacity shored up with a $600m taxpayer-funded lifeline — at least for the next three years.
But the longer-term future of the Mount Isa copper smelter and Townsville refinery hinges on Swiss mining giant Glencore ensuring the viability of the sector, attracting investment, and creating more jobs.
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The reprieve has been warmly welcomed by workers and stakeholders, though federal MP Bob Katter warned the lifeline was a “Band-Aid on a compound fracture”.
“It might staunch the bleeding but it ain’t going to fix your leg,” he said.
The deal comes after eight months of negotiations between the federal and state governments and Glencore, with Federal Industry Minister Tim Ayres saying seeing the plan through would require “a lot of hard, collaborative work”.
The $600m lifeline will be funded equally by the Crisafulli and Albanese governments, and involves payments of $200m a year.
The third payment is contingent on Glencore meeting requirements like completing a transformation study on how to further develop industrial capabilities in the region.
The Swiss company had initially asked for $2.2 billion over ten years.
But Mr Ayres, in an interview with this masthead, said the government’s approach was to safeguard Australia’s metals manufacturing industry with discipline.
“We’re using public revenue to secure a public policy outcome in the national interest,” Mr Ayres said.
“It’s important though to adopt a tough posture to secure the right outcome for the country. But it’s also important to try and develop a shared view.”
Mr Ayres said he expected the company to “only continue with these investments if they’ve got an expectation of future profitability, that’s the reality of how the market works”.
It won’t make the operations profitable in the next three years according to Glencore, which expects to continue operating at a loss. The Swiss miner confirmed it would still invest $2.5bn over the coming years into the region.
The Mount Isa copper smelter — commissioned in 1953 — and the Townsville refinery employ a combined 600 people. But thousands of jobs, including the survival of smaller mines, and rail and road transport jobs among others depend on the smelter staying open.
Smelter and refinery workers had experienced months of anxiety about their future, and there was significant relief on Wednesday.
It also holds half of Australia’s copper smelting capability — producing a metal crucial to the nation’s renewable energy transition.
Mr Ayres told this masthead that after eight months of negotiation, seeing the plan through would require “a lot hard, collaborative work”.
“We’ve worked hard to get on the same page as Glencore. But I do want to drive a process that’s collaborative across the region, that delivers some real accountability and charts a course,” he said.
He said there was no reason why north west Queensland shouldn’t be the “silicon valley of critical minerals in Australia”.
“And securing this asset is an important part of securing a future made in Australia,” he said
A key part of how the smelter becomes viable is tied with energy prices, but Mr Ayres said the government was working to secure the county’s gas advantage.
Mount Isa’s energy future will also hinge on Queensland’s revamped plan, set to be unveiled by state energy minister David Janetzki on Friday.
Kennedy MP Mr Katter warned the lifeline would only limp Mount Isa to the next election.
“This proposal is a Band-Aid on a compound fracture,” he said.
Glencore chief operating officer Troy Williams said the package was an “important lifeline” that would allow the company to “sit back, monitor the market, and make sure that we work together to find solutions for the region”.
“We believe three years gives us time to monitor the market’s reaction, and it gives us an important opportunity to support 600 workers.”
Queensland industry minister Dale Last, who travelled to Mount Isa with Mr Ayres to make the announcement, said the government would keep their “finger on the pulse”.
“We’re going to work with Glencore. We’re going to make sure that we are there every step of the way over this next three years to ensure the continued operation of this smelter,” he said.
Townsville Enterprise chief executive Claudia Brumme-Smith said the announcement “gives hope for the new industries that are definitely wanting to come to Australia and to our region”.
The federal coalition accused the government of launching “another corporate bailout because of their reckless energy policy”.
“Corporate bailouts are nothing more than hospital passes which paper over Labor’s failure to address their terrible trifectaof soaring energy prices, high taxes and rigid regulation,” they said.
Originally published as Bob Katter warns mining giant Glencore’s $600m taxpayer funded lifeline is a ‘band-aid on a compound fracture’
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