PERTH (miningweekly.com) – The continued fall in commodity prices have contributed to the Queensland government wiping some A$1.5-billion in revenue from its bottom line.

This latest round if write-downs over the forward estimates was in addition to the A$3-billion written down in July.

“There’s no denying world economic conditions have become tougher since the Budget, as they have for all governments, which is why our revenue write-downs now total A$1.5-billion over the forward estimates compared to Budget time.

“This is predominately due to declines in payroll tax collections from the mining and construction sectors, as well as downwards revisions to royalties as a result of world resources prices, particularly for coal and oil,” said Queensland Treasurer Curtis Pitts.

In the Mid Year Fiscal and Economic Review, the state government noted that since the 2015/16 Budget, estimates of the contract price for hard coking coal have been revised down by around $14/t in each year of the forward estimates.

Similarly, thermal coal prices have been declining, which reflected flat global pig iron production, downgrades to forecasts of industrial production growth of major importers of Queensland coal, and a reduction in thermal coal usage in China.

The emergence of the liquefied natural gas (LNG) export industry in 2014/15 had previously been expected to contribute strongly to growth in royalty revenue from 2015/16, however, since the Budget, estimates of LNG export prices, and therefore coal seam gas (CSG) prices, which were both linked to oil prices, have been revised down, resulting in reductions in forecast LNG related revenue in each year of the forward estimates.

Despite the prevailing commodity prices, the burgeoning LNG industry was expected to boost Queensland’s economic growth, with Treasurer Pitts predicting a 4% growth in 2015/16 and 2016/17, as exports of LNG product increased with the completion of project construction.

“We will see surpluses totaling over $1 billion each and every year out to June 2019,” Pitt said.

“We have achieved this while meeting our commitment to no new fees, taxes and charges, and no change to royalties, this term of government.”