Mining continues to play a central role in New South Wales’ economy, with the 2026–27 State Budget forecasting royalty revenue to climb as the state looks to regional investment and project approvals reform.
The Budget has tipped royalties to rise from $3.2 billion in 2025–26 to $3.4 billion in 2026–27, reinforcing the weight of the resources sector in the state’s revenue base at a time when governments are seeking stronger productivity and new sources of investment.
Association of Mining and Exploration Companies (AMEC) chief executive officer (CEO) Warren Pearce said the Budget underlined the importance of mining to the NSW economy.
“As mining grows into one of the state’s top income streams, it reinforces the importance of maintaining a competitive investment environment for exploration and mine development,” Pearce said.
“This significant contribution from the resources sector supports jobs, productivity and essential government services.”
The lift in royalties also comes after the NSW Government revised royalty revenue upwards by $84 million in 2025–26 and $186 million in 2026–27, reflecting higher thermal coal prices.
The Budget papers said the increase was driven by energy security concerns and gas-to-coal switching among major Asian trading partners, following disruptions to oil and gas flows stemming from conflict in the Middle East.
Thermal coal prices have risen by more than 20 per cent since the outbreak of the conflict, although the Budget expects royalty revenue to broadly normalise from 2027–28 as coal prices gradually return to pre-conflict levels.
These figures represent the continuing fiscal role of coal in NSW, even as the state also seeks to build a stronger pipeline of critical minerals projects.
The Government is keeping its Critical Minerals Royalty Deferral Scheme in place, allowing eligible projects to defer royalty payments during their early production phase. Up to $250 million remains available over five years to help projects transition into production.
The Budget papers described the scheme as a measure designed to support the development of critical mineral projects in NSW, increase investment, create jobs and stimulate regional growth.
The policy is aimed at easing early cashflow pressure during one of the most capital-intensive stages of a project’s life cycle, with the broader test being whether the scheme can help prospective mines move beyond feasibility and approvals into construction and production.
That challenge is also tied to land access and approvals, two areas that have remained a consistent focus for the exploration sector.
Work to unlock better land access is picking up pace, including reforms aimed at streamlining approval processes, clarifying landholder engagement requirements and reducing duplication across regulatory agencies.
“These reforms are essential to reducing delays, improving certainty and helping responsible explorers get on the ground faster,” Pearce said.
AMEC has also welcomed the launch of the Development Coordination Authority on July 1, which is designed to operate as a one-stop shop to coordinate agency inputs on development applications and planning proposals.
The authority will be housed within the Department of Planning, Housing and Infrastructure, with functions transferred from several parts of government, including climate, environment, emergency services and transport portfolios.
In the context of mining and resources proponents, it points to a wider effort to reduce duplication across government and also improve the process in which major projects navigate the planning system.
Likewise, approvals remain one of the biggest barriers to investment, particularly for explorers and developers trying to raise capital in a competitive global market
“There’s no better way to improve productivity than approving projects quicker,” Pearce said.
“If the Development Coordination Authority can help cut duplication and keep projects moving, it will be a practical reform that supports investment and regional economic activity.”
The Budget also maintains a regional development focus, with the Primary Industries and Regional Development portfolio playing a role in the responsible management and use of natural resources, including mining and resource development.
The Infrastructure Statement includes $451.2 million in capital investment across the portfolio over the four years to 2029–30, supporting sustainable industry growth and infrastructure that underpins regional prosperity.
While much of the immediate royalty uplift is linked to coal market conditions, the longer-term opportunity for NSW lies in whether it can convert exploration and critical minerals policy settings into new mines, processing capacity and regional jobs.
