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BHP slashes 750 jobs, says coal industry ‘approaching crisis point’
Updated ,first published
BHP has revealed it will cut 750 jobs from its Queensland operations, with the global mining giant blaming the state government’s coal royalties regime for edging the market towards “crisis point”.
The world’s biggest mining company has been vocal in lobbying Queensland to ditch its tax settings on the industry, which was overhauled by the former Labor government in 2022.
The current Crisafulli government has repeatedly said it would not amend the royalties regime, which has faced intense and continued scrutiny from the coal industry.
BHP had warned the royalties hike had deteriorated its operational prospects in Queensland and on Wednesday morning told workers and the market it was suspending low-margin operations.
The company’s Mitsubishi Alliance (BMA) in Central Queensland will cut 750 jobs, with its Saraji South mine in the Bowen Basin placed into a period of care and maintenance from November.
In a pointed message to the Queensland government, BHP said it would also review its FutureFit Academy in Mackay, a training facility with paid pathways in the mining industry, but would continue the academy’s WA division.
“BHP and Mitsubishi Development do not want to see operations paused or jobs lost, but these are necessary decisions in the face of the combined impact of the Queensland government’s unsustainable coal royalties and market conditions,” BMA asset president Adam Lancey said in a statement on Wednesday morning.
“The simple fact is the Queensland coal industry is approaching a crisis point.
“This is now having real impacts on regional jobs, communities and small businesses.”
Between 2022-23 and 2023-24, Queensland pocketed $31 billion from coal royalties following the overhaul, but the revenue has steadily declined in recent years.
In the Queensland state budget in June, the state had forecast to receive $6.2 billion this financial year before gradually decreasing to $5.3 billion in 2028-29 – a total of $30.2 billion over four years.
Following the announcement, Deputy Premier Jarrod Bleijie reiterated the state government would not overhaul the royalties’ regime – a position the LNP had taken to the 2024 Queensland election.
He insisted the government’s position on the tax had provided certainty to the sector, despite the open criticism from BHP, and again declared the LNP’s election victory in Queensland was a boon for the resources sector.
“We are doing everything we can as a government to make sure that Queensland is open for business, particularly in the mining sector,” Bleijie told reporters.
“We are not at war with the mining sector – we are approving leases and mining approvals far more efficiently and quicker [than the previous Labor government].”
But the deputy premier was scathing of the miner’s announcement it was considering ditching the centre of excellence academy in Mackay.
“I think that is un-Australian,” Bleijie said.
“They have made billions of dollars from the resources owned by Queensland taxpayers and Queenslanders, and they should keep investing in the future of young people who want a job in a mine or resource sector in Queensland.”
Former Labor treasurer Cameron Dick overhauled the three-tiered royalty scheme, with the government pocketing 7 per cent of the sales revenue up to $100 per tonne, then 12.5 per cent of the value between $100 and $150 per tonne and 15 per cent of any revenue generated above $150 per tonne.
Stuart Bocking, boss of industry lobby Coal Australia, said the LNP government was responsible for the job losses at BHP despite it inheriting the royalty settings from Labor.
“Queensland’s unsustainable coal royalties’ regime was not the creation of the Crisafulli government, but today’s job losses have occurred on their watch,” he said in a statement provided to this masthead.
“With global coal consumption at record highs, this could be a golden era for Queensland coal mining. And we look forward to urgently working with the Queensland government to make that a reality.”
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James Hall is the News Director at the Brisbane Times. He is the former Queensland correspondent at The Australian Financial Review and has reported for a range of mastheads across the country, specialising on political and finance reporting.Connect via X or email.