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Queensland asks coal miners for state fund contribution to cancel royalty hike

The Queensland, Australia, government asked coal mining companies in the state to contribute to a planned A$100 million regional infrastructure fund in exchange for ruling out a royalty hike in June, ABC News reported May 29.

Treasurer Jackie Trad said the state government would contribute A$30 million to the fund over three years, with a royalty freeze to be reviewed after a year if mining companies agree to the plan. Trad met with certain mining company representatives, who will discuss the proposal with their boards and executives.

State coal miners pay a 7% levy on coal sold for less than A$100/t, according to a same-day report from The Australian.

The report noted speculation that the 7% levy could be replaced by a 10% or 12.5% rate. This could cause issues in the thermal coal industry as thermal coal usually trades under A$100/t.