Booming iron ore exports have pushed resources royalties to the state government above the $2 billion mark for the first time.
Booming iron ore exports have pushed resources royalties to the state government above the $2 billion mark for the first time.
Royalty receipts for Western Australia hit $2.09 billion in the year ending June 30, up 21 per cent from the previous corresponding period.
Last year, it was a tight finish for royalty leadership, with iron ore just pipping petroleum products as the state’s highest earner.
This year, the mineral side of the equation won easily, jumping 25 per cent in 2006-07 to hit $851.1 million for the period, or 41 per cent of all royalty receipts, according to the Western Australian Mineral and Petroleum Statistics Digest.
“This trend in iron ore is likely to continue into the future with prices forecast to increase again in the coming year, the major producers BHP Billiton Ltd and Rio Tinto Ltd announcing major increases in production as well as a host of projects coming on stream,” the Department of Industry and Resources reported in the digest.
Petroleum royalties to the state amounted to $714.1 million for the period, a gain of just 5 per cent, though the state collected a further $382.1 million from the North West Shelf project on behalf of the commonwealth.
The oil and gas operations off WA’s coast contributed a further $1.56 billion to federal coffers during the past financial year.
Nickel products came a distant third with $184.5 million in royalties paid, a jump of 113 per cent.
Diamonds dropped significantly to $21 million from $48.2 million, reflecting the drop off in production at the Argyle diamond mine near Kununurra where open pit mining is shifting to underground.
The Pilbara was, unsurprisingly, the state’s richest region, representing 61 per cent of the value of all resources extracted for the year.
Almost $32.52 billion in commodities was mined or flowed from the region.
Next was the Goldfields-Esperance region with $10.19 billion worth of minerals or 19 per cent of the state’s output.
Peel came third with 9 per cent worth $4.82 billion.
The value of iron ore overall has climbed markedly as prices and output has jumped in recent years.
In almost a decade, WA has grown production to 258.3 million tonnes per annum, from 149.7mtpa.
The 2006-07 value of $15.75 billion is almost triple the value over the period in real terms, up from $3.93 billion in 1997-98, which is worth $5.42 billion if CPI were taken into consideration.
During the same period, petroleum products have risen to $16.35 billion from $4.93 billion in 1997-98, or $7.15 billion in today’s dollars.
Gold has dwindled in importance during that time. In 1997-98, 239.46 tonnes was worth $3.47 billion (in today’s terms $5.03 billion) against 156.68t current production worth $4.09 billion.
Nickel again is the staggering performer, up to $8 billion on 173,690t, from $1.15 billion from 135,190t in 1997-98, worth $1.66 billion in today’s prices.
