The shutdown of Xstrata’s copper smelting and refining operations in Queensland is a timely warning of the fragility of the Australian resource sector’s global competitiveness, Queensland Resources Council Chief Executive Michael Roche said.

‘Xstrata Copper has made it clear that the competitiveness of their smelting and refining operations had been ‘hit for six’ by the combination of cheaper, newer Chinese plant and rising costs here in Australia, and not in anticipation of a carbon price,’ Mr Roche said.

‘What the Xstrata decision does demonstrate is that even very energy-efficient operations such as those operated by them in Queensland cannot compete against cheaper alternatives.

‘My fear is that these closures are a foretaste of what will follow if the Federal Parliament agrees to impose an uncompetitive carbon price regime on our trade-exposed resource sector industries.’

Mr Roche said that all the evidence pointed to a revived CPRS-style carbon pricing scheme destroying jobs across the Queensland resource sector.

‘It is not too late for the federal government to embrace a better way – one that safeguards our global competitiveness.’

Mr Roche urged the Federal Government to follow Europe’s lead in taking a transitional approach to carbon pricing for emissions-intensive industries competing globally.

The European Union (EU) emissions trading system from 2013 will extend up to 100 percent free allowances to 73 percent of EU exports until 2020 to reduce the costs for those deemed to be exposed to significant competition from outside the EU.

‘At the top of that list are Europe’s mining, minerals processing and metals refining industries.’

Mr Roche also called on the Queensland Government to take a stronger position with their federal colleagues over the vital importance of safeguarding trade-exposed industries.

The Premier said recently that her carbon price ‘wish list’ included compensation for trade-exposed industries that was at least as favourable as under the CPRS.

‘What the Premier needs to tell the Prime Minister is that a CPRS-style approach to compensation is simply inadequate.’

Mr Roche said that under a CPRS-style compensation package the coal mining industry alone would incur carbon costs of $18 billion by 2020 that would jeopardise investment and jobs in Queensland’s biggest export industry.

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