11 Jun 2010

Mining tax factor in axed projects

1:44 pm on 11 June 2010

Aluminium smelter upgrades worth $A4.5 billion have been scrapped in the Hunter Valley in New South Wales, due to a proposed federal mining tax, carbon reduction legislation and electricity prices.

The ABC has been told a Norwegian company, Hydro, has shelved a $A4 billion upgrade of the Kurri Kurri smelter, while plans for a proposed $A600 million potline by Tomago Aluminium have also been scrapped.

The ABC reports escalating electricity prices are the biggest concern along with a proposed federal tax of 40% on mining profits, carbon reduction legislation and renewable energy targets.

The projects could have created up to 20,000 new jobs.

The Australian Aluminium Council is worried future investment will be forced offshore.

Executive director Miles Prosser says exemptions are needed to ensure the aluminium sector survives.