Xstrata Copper says it is now reviewing all of its operations in northern Queensland in Australia after the Australian government's proposed tax on the mining sector. Last week the government announced it will tax mining company’s profits by 40 per cent from 2012.
Xstrats will now suspend its exploration programme in the Mount Isa and Cloncurry districts. Chief operating officer Steve de Kruijff says its exploration programs in the region were all going ahead until the Government announced the new tax.
"We started to think about well are new exploration sustainable under a tax regime that overlays on our current tax system of that size," he said.
"I guess until we can find out more certainty over what the different requirements of this tax are we're not prepared to continue to spend money on exploration projects on the North West regional area."
"Exploration activities are high risk and, while the targets we had identified are prospective, the proposed tax has introduced great uncertainty about the potential impact on the economics of developing resources into viable operations in Australia," he added.
The company says that current operations will continue. Xstrata produces about 200,000 tonnes a year of copper from its Australian operations.
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