Australia's biggest miner to get diesel subsidies

Date: 5-May-2008
Australian taxpayers will give BHP Billiton an estimated $117 million in diesel fuel subsidies during the four-year
expansion of the company’s Olympic Dam mine, according to figures
released today by the Australian Conservation Foundation.

“The Fuel Tax Credits scheme, which cost taxpayers $4.9 billion in the 2006-07 financial year, will allow BHP
Billiton to claim an average of $29 million a year in diesel rebates
for the four years of construction at Olympic Dam,” said ACF Executive
Director Don Henry.

BHP Billiton operates more than 20 mines and processing facilities in Australia. The company’s average annual diesel
rebate from taxpayers is believed to around $138 million.

“While hard-working commuters from the outer suburbs of Australia’s cities,
who have little or no access to reliable public transport, pay 38 cents
a litre in tax on the petrol they need to get to work, the world’s
biggest mining company doesn’t pay a single cent in tax for the diesel
it uses in all its off-road mines,” Mr Henry said.

“The Fuel Tax Credits scheme is often justified as a benefit to struggling farmers,
but in fact agriculture, forestry and fishing together now take only 15
per cent of the fuel tax breaks by total value, while more than half
goes to mining and transport companies.

“The Federal Government should use this year’s Budget to restructure the Fuel Tax Credits
scheme – which encourages greenhouse pollution and costs taxpayers
billions every year – and invest the savings in securing a cleaner and
more equitable future for all Australians.”

BHP Billiton has plans to expand the Olympic Dam copper and uranium mine in South
Australia to it into the largest open pit mine in the world –
approximately three kilometres wide and three kilometres long.
Eventually it could be one kilometre deep. 

The ore body is approximately 350 metres below the surface, so the first four years of
the expansion would involve removing massive quantities of earth and
rock to this depth. Approximately one million tonnes of earth and rock
would have to be moved every day for four years: that’s 365 million
tonnes a year or 1.46 billion tonnes over four years. Heavy vehicles
powered by diesel fuel would be used to dig and carry rocks and earth.