Queensland still paying the price for bad LNG deals

State leader of the KAP and Member for Traeger, Robbie Katter, says recent export earnings and royalty figures show the LNG industry is still falling short of the contribution promised to the people of Queensland.

“In 2010 the Bligh Government’s “Queensland LNG Industry” blueprint1 estimated royalties to be over $850 million per annum.

“Last year the royalties were $98 million and this year they’re $198 million. Dismal.” Robbie said.

Robbie points to the negative impacts of huge increases in gas prices caused by the proliferation of the LNG industry.

“The increases to gas prices, and by extension electricity prices, have been the worst thing. This combined with the overpromised and under-delivered royalties, it’s hard to justify that the LNG industry has been a net benefit to the state.

“Gas prices have stabilised somewhat and I acknowledge the work the current Government has done through Minister Lynham to sure up domestic supply.

However, the damage has already been done.

“We know domestic prices increased by at least three fold after the LNG export industry came into the market and for some large users in North Queensland they were struggling to get any form of long term gas supply.

“This completely undermines opportunities for manufacturing and value adding industries such as minerals processing.

Robbie says mining and processing in North and North West Queensland is being sacrificed because the Bligh Government was out-negotiated by the LNG companies.

“Base metals mining, a majority of which is done in the North West Minerals Province, still pays more than the LNG industry in royalties despite earning less revenue.

“You almost can’t blame the LNG companies for destroying the gas market in Queensland. They’re just doing what’s best for them like all businesses.

“The fault really lies with weak governments who let these multinationals walk all over them. If the Government of the day had some backbone and put a gas reserve policy in place, domestic supply wouldn’t be an issue and we’d still have an LNG industry.

2017/18 financial year

Sector                                              Export earnings (to May 2018)2               Royalties (2017/18 Budgeted)3

LNG                                                $2,990 million                                              $188 million

Base and Precious Metals          $2,500 million                                             $371 million

1 Blue Print for Queensland’s LNG Industry, p. 6 https://www.cabinet.qld.gov.au/documents/2009/Aug/LNG%20Impacts%20Review/Attachments/LNG%20Industry.pdf
2 http://statements.qld.gov.au/Statement/2018/7/4/queensland-exports-continue-to-soar-to-new-heights
3 2018/19 QLD Budget, Budget Paper 2, p 62. https://budget.qld.gov.au/files/BP2-2018-19-4%20Revenue.pdf

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