BHP, has warned it will look carefully at its coal investments n Queensland after the recent rise in royalty charges in the Australian state.
In what was a generally downbeat fourth quarter update, Mike Henry. the Aussie-listed mining giant’s chief executive, said: “BHP is assessing the impacts on BMA economic reserves and mine lives as a result of the increase in coal royalties by the Queensland government.
“The near tripling of top-end royalties has worsened what was already one of the world’s highest coal royalty regimes, threatening investment and jobs in the state.”
BHP has a coking coal joint venture with Japanese firm Mitsubishi that mines from seven sites in central Queensland’s Bowen Basin.
The miner added that it faces challenges across its operations with labour shortages causing it to miss its nickel output target though iron ore volumes were a record and coking coal in Queensland going well.
JP Morgan noted that full-year iron ore shipments at 292mln tonnes were strong but the average realised iron ore price of $US113 a tonne was below forecasts.
In copper, Escondida in Chile had record material mined and near-record concentrator throughput, while Olympic Dam in South Australia performed strongly in the fourth quarter after planned smelter maintenance.
BHP also highlighted that cost pressures were continuing, while the recession and weaker demand from China might hit demand in future.
"We expect the lag effect of inflationary pressures to continue through the 2023 financial year, along with labour market tightness and supply chain constraints," said Henry.