Logistics, Ports & Terminals, Mining and Heavy Industries

McGowan softens stance after miners rattled

Laing O'Rourke works across a number of Australian sectors including rail. It worked on BHP's RGP5 Railway in the Pilbara, pictured here. Photo: Laing O'Rourke

Western Australian Premier Mark McGowan has looked to appease mining giants Rio Tinto and BHP Billiton over proposed multi-billion-dollar, up front, lump sum tax payments aimed at easing the state’s financial issues.

The premier worried miners on Sunday, reportedly suggesting the miners “buy out” the 25 cent lease rental fee they pay for every tonne of iron ore they mine, resulting in up-front payments worth around $150 million per year paid ahead of time.

Association of Mining and Exploration Companies chief executive Simon Bennison rejected the proposal, saying the miners didn’t like it, and it would not work out in the state’s favour.

“Every dollar raised through this ‘cashing out’ will head east via the Commonwealth Grant’s Commission’s redistribution,” Bennison said.

McGowan attempted to clarify his position on Monday.

“This is not some new tax,” he told ABC Radio. “It is whether or not an agreement is reached between mining companies and the government. I think it shows a government is prepared to work with industry to achieve outcomes.”

The premier didn’t seem confident the plan would come to fruition, however.

“The mining companies may well say in light of the furore that has been generated in the last couple of days they are not interested and if that is the case they will continue to pay the 25c per tonne forever more and we will get ongoing revenue,” he said.

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