This was mentioned on another thread but I think it deserves...

This was mentioned on another thread but I think it deserves more volume:

http://www.news.com.au/business/voters-to-pay-cost-of-bp-style-disaster-under-government-plan/story-e6frfm1i-1225877225804


TAXPAYERS would be forced to contribute 40 per cent of the cost of a BP-style environmental disaster.

The tax slug is part of the Federal Government's plan to refund project losses as part of its proposed resource super-profits tax.

Senior Treasury officials confirmed on Friday that the Government would guarantee 40 per cent of a company's losses sustained through a major environmental incident.

The Australian has spoken to several conference participants who confirmed the officials' comments in response to a question that cited the BP oil spill in the Gulf of Mexico.

It is understood many of the investors were shocked to learn of the potential extent of the Government's liability for environmental clean-ups.

"If you get a massive liability problem like BP in the US, which by some estimates will cost up to $10 billion, that means the government will put its hand in its pocket for $4bn," one of the investors said.

A Treasury spokesman last night declined to comment immediately on whether the government would have to accept any liability for an environmental incident under the RSPT, describing the question as "highly technical".

It is unclear whether the Government has considered the possible outcry if it were forced to refund a mining company for a disaster such as a serious tailings spill.

One of the most infamous tailings spills to hit the Australian mining industry occurred at BHP Billiton's Ok Tedi copper and gold mine in Papua New Guinea in the 1990s, although offshore projects would not be included in the planned RSPT.

Sources suggested the Government would be criticised it if tried to cap its potential liability under the RSPT unless it also reduced the 40 per cent profits it planned to take from successful projects.

Under the proposed RSPT system, any losses on a mining project would receive a 40 per cent refund from the Government, either as a credit against tax on future earnings or as a refund if the project folded.