Mining tax threatens Casino gas

Super tax uproar: Metgasco shareholders are furious at the proposed new tax on mining companies, company officials say.
Super tax uproar: Metgasco shareholders are furious at the proposed new tax on mining companies, company officials say. Jacklyn Wagner

METGASCO, the mining company that has invested $50 million in gas exploration on the Northern Rivers, fears the Federal Government’s new tax on mining ‘super profits’ could threaten its Casino operations.

Chief financial officer Glenda McLoughin flew up from Sydney yesterday to meet with workers and look at the company’s options.

Metgasco’s market value was slashed by 25 per cent following the Federal Treasurer’s announcement last week and Ms McLoughin believes that could seriously impair the company’s ability to raise capital to fund its appraisal and development program in the region.

“We’re saying to the Government, please do not progress with this tax as it’s currently constructed,” she said.

“I’m not saying we won’t go ahead (in Casino), but our sharemarket value has been seriously affected, which means it’s going to be difficult to raise capital for future projects.

“I was quite concerned to read Wayne Swan’s comments this morning urging shareholders to tell management to calm down and stop complaining about the tax, because I spent most of last Monday and Tuesday taking calls from our shareholders who are absolutely furious at the proposed imposition of the tax and telling us to get out there and start fighting against it.”

While Mr Swan has suggested his proposed policy has exploration tax benefits for ‘junior’ mining companies to expand, Ms McLoughin said a tax reduction on exploration wouldn’t help Metgasco if it couldn’t raise market capital.

“We do welcome the resource exploration rebate, but that doesn’t really offset the heavy cost of the proposed super tax,” she said.

“If you’re a shareholder in this company I think you’ll see the implications of this tax quite well with the value of your shares dropping 25pc in two days ... to expect that shareholders will invest in a company like us to get a fixed percentage return is patently absurd.”

Nationals candidate for Page Kevin Hogan said the Government’s tax threatened a project that would provide jobs, local economic benefits and green power benefits.

“I’d ask Ms Saffin to put local jobs ahead of Labor politics and not support this new tax,” he said.

Ms Saffin said she strongly supported the Metgasco project.

“I will pit my record on supporting local jobs against Mr Hogan’s any time,” she said. 

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