Australia-based coking coal miner BHP Mitsubishi Alliance (BMA), a joint venture between Australian miner BHP Billiton and Japan-based Mitsubishi, will suspend operations at the Saraji South coal mine in Queensland from November 2025, placing the site into care and maintenance, according to a report by Reuters. The move will result in the loss of 750 jobs.
Production background
The Saraji Complex produced 8.2 million mt of coking coal in the year ending June 2025. Apart from Saraji South, BHP operates four other mines under the BMA banner in Queensland. Coking coal from the complex is a critical raw material for steelmaking.
Reasons for suspension
Adam Lancey, asset president at BMA, said the decision was driven by the combined impact of unsustainable state coal royalties and market conditions:
In July 2022, Queensland’s state government sharply raised royalties, introducing a 20 percent rate for coal priced above A$175/mt and a top tier of 40 percent for prices over A$300/mt. Previously, royalties were capped at 15 percent for coal above A$150/mt. BHP CEO Mike Henry criticized the royalty hike, calling it imposed without industry consultation.
Meanwhile, coking coal prices spiked above A$600/mt after Russia’s 2022 invasion of Ukraine and have since normalized to around A$190/mt.
Medium-term outlook
BHP stressed that, while medium-term demand for hard coking coal remains strong, sustaining operations in lower-margin mine areas is no longer viable under the current cost structure.
The suspension reflects ongoing pressure on coal miners in Queensland balancing market volatility, government taxation and royalties, and rising operational costs.