Grylls proposes amendments to state agreements

PERTH (Miningweekly.com) – The Western Australian Chamber of Minerals and Energy (CME) has warned that attempts to change state agreements between iron-ore majors and the state government will jeopardise the state’s international reputation.

The warning comes after Western Australian Nationals leader Brendon Grylls on Tuesday reiterated his plans to review state agreements with majors BHP Billiton and Rio Tinto.

"The industry is very, very different to what Sir Charles (Court) envisaged in the 1960s," Grylls was quoted as saying by the ABC.

"That is why it is timely that we look at these state agreements and how they are working for the state, how they are delivering benefits for the state and how we can ensure the state gets the best outcome.”

State agreements can only be amended if both the state government and the mining signatories agree to the amendments.

However, Grylls reportedly said that he did not accept that the state agreements could not, or should not, be reviewed and amended to meet the changing needs of the state.

"If you believe that we can only change state agreements by mutual obligation, you are actually accepting that, in 50 years time when the state agreements are 100 years old, that it would be acceptable for 25c to still be 25c," Grylls reportedly said.

Grylls had previously suggested imposing a A$5/t levy on the iron-ore majors, to replace the current 25c/t levy.

The CME said on Tuesday that Grylls’ “increasingly belligerent overreach and reckless attacks” on the iron-ore industry were of great concern.

“The attacks on Western Australia’s mining sector are unjustified and increasingly appear to be an attempt to find a new pot of money for political purposes rather than a genuine attempt to put in place policy that will have any benefits whatsoever,” said CME deputy CEO Nicole Roocke.

She noted that attempts to unilaterally change state agreements undermined the industry and would jeopardise the state’s international reputation as a place to do business and invest.

“This, combined with the Nationals’ job-destroying new mining tax, is not something we can afford to have happen. Literally thousands of jobs depend on it.

“These types of statements by political leaders hurt the state’s standing as a safe place to do business. It is disappointing that a political leader will make reckless comments like this in an attempt to play political games, especially as the industry is trying to navigate through a period of tough times and create more jobs.”

Roocke noted that Rio and BHP directly contributed A$1.9-billion to the state electorate seat of Pilbara in 2014/15 alone.

Last week, Nationals leader Barnaby Joyce said that a new iron-ore tax on BHP Billiton and Rio Tinto was unwanted.