GLOBAL mining giants have scaled back their investment in Australia as the backlash against the government's “mining tax” intensified.
Xstrata suspended copper exploration in the state of Queensland, coal giant Peabody Energy cut its offer price for Macarthur Coal and BHP Billiton warned that approving key expansion projects would be difficult given the new tax.
Until now, heavyweights BHP Billiton and Rio Tinto had only threatened to take investments off the table if Prime Minister Kevin Rudd proceeded with his plan to boost corporate mining taxes to 40 per cent, effective in 2012.
But yesterday, the warning became reality. “The proposed tax has introduced great uncertainty about the potential impact on the economics of developing resources into viable operations in Australia,” said Steve de Kruijff, chief executive of Xstrata Copper North Queensland.