Royalty Legislation Amendment Bill 2020
Bill Story
The journey of this bill through Parliament, including debate and recorded votes.
Referred to Economics and Governance Committee
Argued royalties should be used as an economic lever to keep jobs rather than just as a revenue tool. Called for royalty adjustments to keep the copper smelter in Mount Isa open, warning thousands of jobs were at risk.
“Royalties can be a great enabler and lever for government. They should not be seen just as opportunity to pull cash out of an industry but seen as an enabler.”— 2020-08-13View Hansard
As Treasurer, defended the volume model for petroleum royalties, arguing it levelled the playing field among producers and provided certainty. Rebutted LNP calls for a 10-year royalty freeze, noting the LNP had increased coal royalties despite their own 10-year freeze promise in 2012.
“Resource companies know what the promise of a 10-year royalty freeze really means when the LNP says it.”— 2020-08-13View Hansard
Plain English Summary
Overview
This bill changes how Queensland calculates petroleum royalties and modernises royalty administration for both petroleum and minerals. From 1 October 2020, petroleum royalty is based on production volume rather than the previous complex 'wellhead value' method, providing greater certainty for the coal seam gas and LNG industry.
Who it affects
Petroleum and gas producers face a new royalty calculation system. Mining companies see no change to royalty rates but administration moves to the Commissioner of State Revenue. The changes aim to ensure Queensland receives appropriate returns from its non-renewable resources.
Key changes
- Petroleum royalty calculated on production volume, with four categories: domestic gas, supply gas, project gas, and liquid petroleum
- Royalty rates determined by average sales prices, with benchmark prices applying where sales data is unavailable or inadequate
- LNG projects formally recognised with separate rules for 'project gas' linked to international export prices
- Commissioner of State Revenue takes over royalty administration from the Minister, applying Taxation Administration Act processes
- Joint venture participants without tenure can elect to lodge royalty returns and pay directly
- Standardised objection, review and appeal processes consistent with state taxes through QCAT and Supreme Court