The economic assumptions that the Australian government is using to back its proposed super profits tax (SPT) are “flawed”, a new report by global consulting firm Ernst & Young (E&Y) has found. “The model used by the government incorporated a key assumption that mining investment is completely immobile. We do not believe that critical assumption is realistic for the twenty-first century global mining industry,” the authors of the report stated.

Chinese companies will build mines, railways and port facilities in Australia under a series of billion-dollar resources deals signed in Canberra today. Chinese Vice-President Xi Jinpeng inked the deals in meetings with Prime Minister Kevin Rudd....Under one deal, Chinese companies will help fund a $US8 billion coalmine, railway and coal-loading terminal near Bowen in Queensland. Mr Rudd said that deal would yield $A4 billion in exports each year for 25 years.

Mining takeovers in Australia, the biggest shipper of iron ore and coal, are set to fall to a five- year low after government plans to increase tax on the industry kicked up a hail of protest from the world’s biggest producers...The decline in takeovers supports predictions by Citigroup Inc. and Xstrata Plc, which joined with BHP Billiton Ltd. and Rio Tinto Group in campaigning against the 40 percent tax on mining profits.

The chimera that is Kevin Rudd's "consultation" with Australian miners on his super tax was exposed yet again yesterday in the curt, singular commentary delivered by mining's newest Three Amigos, as they retreated from yet another session of Canberra collaboration. After a tense meeting with Treasurer Wayne Swan and Resources Minister Martin Ferguson, a troika of Australia's biggest miners, BHP Billiton, Rio Tinto and Xstrata, declared yet again that the government was not ready to address the broader mining industry's three fundamental concerns with the resource super-profits tax.

Chile, the world's biggest copper producer, has joined Canada in describing the Rudd government's planned resource super-profits tax as a chance to strip global market share from Australia. But rather than focusing on the level of the tax making Chile more competitive, Chile Mines Minister Laurence Golborne said it was the unstable nature of Australia's tax regime that could send investment dollars to Chile. "The situation in Australia is a tremendous opportunity for Chile, if we can offer the mining sector stability and tranquility," Mr Golborne said in Santiago.

Australian infrastructure owner Asciano has signed a ten-year, A$775-million contract with Anglo American to move 16.5-million tons a year of coal through Queensland, starting in 2012. Asciano said in a statement on Tuesday that it would haul 10.9-million tons a year from Anglo American’s German Creek facility, which is currently being serviced by Queensland Rail. The agreement also provided that the existing 5.75-million tons a year from the Moranbah North mine would also be hauled. 

The Australian Coal Association (ACA) has welcomed the NSW Government announcement of the first 10 projects to receive grants as part of the NSW Government’s Clean Coal Fund. The projects are focusing on low emissions technologies for coal production and utilisation. ACA Executive Director, Mr Ralph Hillman acknowledged the NSW Government’s strong commitment to the development of low emission technologies for coal.

Peabody Energy Corp., the largest U.S. coal producer, slowed work on five expansion projects in Australia because of the proposed mine profits tax. “As we’re reviewing the new potential working environment as a result of the tax, progress on our expansions has slowed,” Jennifer Morgans, a spokeswoman for St. Louis-based Peabody, said today by phone. “The timing and the eventuality of those investments depend on the operating environment.”