Stanmore, Terracom and Coronado shares slammed as Queensland increases coal royalties
The Queensland budget is set to ramp up coal royalties after a 10-year freeze
Source: iStock
Mentioned
KEY POINTS
- The Queensland budget is set to introduce a progressive three tier royalty on coal sales
- Terracom, Stanmore and Coronado are the miners most affected
- Coal miners share prices swing violently, with Stanmore down -20% from a +8% open
ASX coal stocks are plummeting after the Queensland government announced a massive royalty hike for local coal miners.
Treasurer Cameron Dick said Queensland expects a surplus of $1.91bn for 2021-22, reflecting stronger-than-expected housing and labor markets, and increased royalties from coal and oil companies.
The government is introducing an additional three tier royalty rate tiers for coal sold, disposed of or used on or after 1 July 2022.
20% for prices above $175/t
30% for prices above $225/t
40% for prices above $300/t
The royalty was previously 15% for prices over $150/t.
“The additional tiers of coal royalty rates will ensure during future periods of high coal prices that the royalty return to the people of Queensland is appropriate for the use of the state's valuable and limited natural resources,” the budget notes.
Which ASX coal companies are at risk?
Coal companies with Queensland based projects include:
Operates the Blair Athol Coal Mine in Central Queensland
Blair Athol is forecast to produce 2.2m tonnes per annum
Recent offtake for 1.25m tonnes (August 2022-23) at Newcastle Index prices
All four major coal-producing assets are located in Queensland
Coronado Global Resources (ASX: CRN)
Operates the Curragh Mine in Central Queensland
Massive intraday swing
Before the news broke out, all three affected coal names were all up around 8% on Tuesday.
Now, as at 3:00 pm AEST:
Terracom -5.9%
Stanmore -20.5%
Coronado -9.7%
Coronado, Stanmore and Terracom intraday price charts (Source: TradingView)
