Australia-headquartered BHP Group and Mitsubishi Development have launched a review process to rank the financial health of their coal mines and assets in Queensland after raising concerns about the Australian State’s royalty regime.

The 50:50 stakeholders in the BHP Mitsubishi Alliance are reviewing each underground and open-cut mine and ranking their costs and financial health against each other, according to people within the joint venture (JV) who asked not to be named because the process is not public.

The Queensland mines returned no profit to BHP in the six months to December 31, 2025, according to the company’s half-year report. The company’s share of the JV’s coal production in the period was 9.2-million tons.

A spokesperson for BHP referred Bloomberg to previous statements made by management and could not comment on the current process.

Mining companies regularly review their assets, however BHP last month warned staff in an internal email seen by Bloomberg that the Queensland mines were unprofitable.

While it’s unclear what the review means for the mines, BHP chairperson Ross McEwen declared there would be “zero” new capital investment across the coal business in the State at a conference in Sydney last month.

BHP has long claimed that Queensland’s royalty regime has crippled its coal business, which includes some of the biggest and highest-quality metallurgical coal mines in the world. The miner moved to close its Saraji South mine and slashed about 750 jobs last September, citing high royalties and weak market conditions that have made low-margin operations unsustainable.

The then-Labor State government hiked royalties in 2022 to a tiered system based on revenue, not profit. The state takes 30% of revenue on each ton of coal sold when prices are above A$225/t, or $161/t, and up to 40% when prices exceed A$300/t. Seaborne metallurgical coal produced in Queensland was trading at more than $230/t on April 17.

The change was aimed at capturing more revenue for the government but has been criticized by industry.

BHP is due to release its operational report for the quarter ended March 31 on April 22.