Whitsunday's Mayor Tries to Save Bauxite Mine Project

Mayor Mike Brunker wants the Queensland government to drop royalties on bauxite to entice international investment. His main aim is to keep the refinery in Queensland to ensure the related jobs don’t suffer. The Mayor of Whitsunday’s encouragement for the industry came on the heels of the termination of talks between the state government and Chalco.

Aluminum Corp of China also known as Chalco announced that the discussions with the Queensland government about the possibility of developing bauxite resources in the Australian state were terminated. This axed a June 2010 agreement to develop a bauxite and alumina operation worth $ 2.5 billion.

Due to the global economic crisis and decline in commodities demand the project was shelved. Now cost estimates and reducing demand for the minerals have made the project economically unviable. Chalco filed a statement with the Hong Kong Stock exchange to this effect. This cost the state of Queensland about 400 jobs.

Discussions are still possible over the development of resources in Aurukun but at prtesent the company may make a provision for impairment regarding the project. Chalco made a statement that it spent about RMB 340 million on the project, adding that it will determine the amount recoverable and make a corresponding provision for impairment.

Source: Queensland Government