🇦🇺Australia

Western Australian State Royalty Revenue Decline - Unrecovered Collections

1 verified sources

Definition

WA Government expected royalty revenue of AUD 522 million in 2024-25, down from AUD 660 million in 2023-24. This AUD 138 million annual decline (21% drop) is a potential indicator of either: (a) legitimate commodity price/volume decline, or (b) missed/unbilled royalties. The Australia Institute notes that 90% of WA's gas is exported by foreign-owned companies, many under zero-royalty terms, limiting revenue base.

Key Findings

  • Financial Impact: AUD 138 million year-over-year decline (2023-24 vs 2024-25); if decline persists: AUD 138 million annually at risk
  • Frequency: Annual - tracked in state budget forecasts
  • Root Cause: Commodity pricing collapse OR contractual zero-royalty exemptions OR underreporting/under-collection by royalty auditors

Why This Matters

The Pitch: WA's gas royalty revenue dropped AUD 138 million in one year—a 21% decline. Forensic audit of gas volumes exported vs. royalties billed would identify if this decline was legitimate (commodity prices) or represents unrecovered/unbilled royalties due to reporting gaps, contractual disputes, or collection failures.

Affected Stakeholders

WA Department of Mines, Industry Regulation and Safety, Revenue Auditors, Gas Project Finance Teams

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Financial Impact

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Methodology & Sources

Data collected via OSINT from regulatory filings, industry audits, and verified case studies.

Evidence Sources:

Related Business Risks

Unaccrued Royalty Revenue on Exported LNG - Zero Royalty Contracts

AUD 13.3 billion over 4 years (AUD 3.3 billion annually); NT portion: AUD 3.4 billion over 4 years. Hypothetical if standard royalty rates applied: 10-40% of AUD 149 billion exported base.

Regulated Gas Network Supernormal Profit Extraction - Consumer Overcharge

AUD 1.8 billion over 8 years (AUD 225 million annually); approximately 5% of typical gas consumer bills; South Australian network returned 30% to shareholders (excess of typical 8-10% allowed return)

Environmental Protection Licence Non-Compliance Fines

AUD 50,000+ fines per breach (typical range for EP Act violations); 20-40 hours/month manual monitoring

NOPSEMA Environment Plan Approval Delays

AUD 100,000+ per month idle rig costs (industry standard for approval delays)

EIS and Site-Specific EA Application Costs

AUD 500,000+ per EIS application (typical for large gas fields); 6-12 months preparation time

STTM Deviation Settlement Imbalances

AUD 100,000+ per month in settlement shortfall charges

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