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Category: Mining Industry / States and Territories / Government and Politics

Rio Tinto, BHP Billiton 'still looking' at mining tax buyout: Barnett

Friday, 7 Oct 2016 05:47:01 | Jacob Kagi

Iron ore being loaded onto a ship in Port Hedland in Western Australia's Pilbara region 2 July 2014 (Supplied: BHP Billiton)

West Australian Premier Colin Barnett is refusing to give up hope of negotiating a buyout of Rio Tinto and BHP Billiton's ongoing lease rental payments, despite the major iron ore miners publicly rejecting the idea.

Mr Barnett insisted discussions would continue on the idea his Government pitched to the two miners, even though BHP and Rio have both said they were not interested in taking up the offer.

It is understood the proposed buyout deal would see the companies make an upfront payment in exchange for the termination of their ongoing lease rental.

Currently, both companies pay 25 cents per tonne of iron ore to the state as a lease rental payment, on top of other royalties and taxes.

Mr Barnett said he was not conceding defeat.

He said BHP and Rio could remove a "significant risk" for them into the future by agreeing to the buyout suggestion.

"We offered the companies an opportunity to get rid of that provision by simply cashing that out," Mr Barnett said.

"They looked at that seriously and I think they still are looking at it.

"I don't know they have rejected it, to be honest. I expect discussions to continue."

Mr Barnett said his discussions had been with the firms' global executives, not local management.

The talks come in the aftermath of the Nationals' push to increase the lease rental rate 20-fold to $5 per tonne, a proposal the miners have described as a serious threat to jobs and investment.

BHP, Rio and Cliffs Natural Resources were the only companies subjected to the 25 cent per tonne levy in 2015-16, because it only applies to mines that have been in operation for more than 15 years.

The rental levy raised $124 million last financial year, with BHP and Rio understood to have paid all but around $3 million of that.

AustraliaPlus


 

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