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Corporate Score 52 Bearish

BHP and Mitsubishi Review Queensland Coal Assets Amid Royalty Concerns

Apr 20, 2026 06:34 UTC
BHP
Medium term

BHP Group and Mitsubishi Development are evaluating the profitability of their joint coal operations in Australia. The review follows growing concerns regarding the Queensland government's royalty structure.

  • BMA is ranking all Queensland coal assets by cost and financial health
  • Joint venture partners are reacting to the state's royalty regime
  • Review covers both open-cut and underground mining operations
  • Internal process is currently confidential
  • Potential for future asset rationalization or divestment

The BHP Mitsubishi Alliance (BMA) has initiated a comprehensive internal review to assess and rank the financial viability of its coal mining portfolio in Queensland. The 50:50 joint venture between BHP Group Ltd. and Mitsubishi Development Pty Ltd. is scrutinizing both open-cut and underground operations to determine their relative economic health. This strategic audit comes as the partners express significant concern over the current royalty regime imposed by the Australian state. By ranking assets against one another based on cost structures and profitability, the partners aim to identify which operations remain sustainable under the existing fiscal framework. According to sources familiar with the matter, the process is currently non-public. The review focuses on identifying underperforming assets that may no longer be viable given the intersection of operational costs and government levies. While no immediate closures have been announced, the move signals a cautious approach to capital allocation in the coal sector. The outcome of this ranking process could lead to strategic shifts in BHP's portfolio, potentially including the decommissioning or divestment of assets deemed unprofitable.

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