W Australia Premier, BHP CEO Hold Talks On JV Royalties
June 17 2009 - 2:59AM
Dow Jones News
Western Australia State Premier Colin Barnett said Wednesday
that he expects a planned joint venture between BHP Billiton Ltd.
(BHP.AU) and Rio Tinto Ltd. (RIO.AU) to go ahead and hopes the deal
will boost state revenue.
But BHP hasn't yet made any concessions to the state's call for
increased iron ore royalties and stamp duty on the transaction,
Barnett told reporters after meeting with BHP Chief Executive
Marius Kloppers.
Barnett said that Western Australia regards the planned joint
venture as "a change in ownership and in effect would attract stamp
duty".
Kloppers "understood our position", though BHP hasn't made any
concessions on the issue, Barnett said.
West Australia wants decades-old royalty concessions
renegotiated and it expects the BHP-Rio joint venture to pay "full
royalty rates" on all iron ore production, he said.
The increase in royalties, which could be phased in over several
years, may increase state revenues by "hundreds of millions of
dollar", he said.
Barnett said the state government and BHP haven't yet reached
the stage of detailed negotiations, but have agreed to meet every
eight weeks or so to discuss the deal.
"The state will cooperate. I mean it is a reality that this
merger is going to go ahead so I'm not going to put my head in the
sand and pretend it's not happening," Barnett said.
He met with Kloppers for nearly an hour and described the
meeting as good.
-By Stephen Bell, contributing to Dow Jones Newswires;
61-8-9244-4243; sgbell@bigpond.com