By Andrew Mackinnon

Last updated: 24th March, 2024

The resources in the ground in Australia, including natural gas, coal, iron ore, bauxite, copper sulfide and many other minerals and metals, are owned by the Australian federal government on behalf of Australian citizens, not the privately owned mining companies which extract them.

The ownership of these resources in the ground by the Australian federal government on behalf of Australian citizens is a separate concept from the cost of privately owned mining companies extracting these resources, which cannot be avoided if these resources are going to be utilised.

The Australian federal government could contract privately owned mining companies on behalf of Australian citizens to extract these resources in a physical amount set by the Australian federal government on behalf of Australian citizens.

(This distinction of the Australian federal government setting the physical amount of resources to be extracted on behalf of Australian citizens, given its ownership of the resources in the ground on behalf of Australian citizens, is possibly missing from the way the mining industry in Australia operates today.)

It would be logical for the Australian federal government to pay privately owned mining companies the agreed prices of extracting the resources and continue its ownership of the extracted resources on behalf of Australian citizens.

The Australian federal government could transfer the ownership of the extracted natural gas and the extracted coal at prices which cover the cost of extraction of these resources on a not-for-profit basis to a publicly owned Australian federal government entity named “Australian Electricity”, which is responsible for generating, distributing and selling electricity across the entirety of Australia, charging Australian citizens, Australian businesses and Australian not-for-profit entities for the electricity that it generates, distributes and sells on a not-for-profit basis.

The Australian federal government could transfer the ownership of the extracted natural gas at a price which covers the cost of extraction of this resource on a not-for-profit basis to a publicly owned Australian federal government entity named “Australian Gas”, which is responsible for producing, distributing and selling processed natural gas across the entirety of Australia, charging Australian citizens, Australian businesses and Australian not-for-profit entities for the processed natural gas that it produces, distributes and sells on a not-for-profit basis.

The Australian federal government could transfer the ownership of the extracted iron ore and the extracted coal at prices which cover the cost of extraction of these resources on a not-for-profit basis to a publicly owned Australian federal government entity named “Australian Steel”, which is responsible for producing, distributing and selling steel across the entirety of Australia, charging Australian citizens, Australian businesses and Australian not-for-profit entities for the steel that it produces, distributes and sells on a not-for-profit basis.

The Australian federal government could transfer the ownership of the extracted bauxite at a price which covers the cost of extraction of this resource on a not-for-profit basis to a publicly owned Australian federal government entity named “Australian Aluminium”, which is responsible for producing, distributing and selling aluminium across the entirety of Australia, charging Australian citizens, Australian businesses and Australian not-for-profit entities for the aluminium that it produces, distributes and sells on a not-for-profit basis.

The Australian federal government could transfer the ownership of the extracted copper sulfide at a price which covers the cost of extraction of this resource on a not-for-profit basis to a publicly owned Australian federal government entity named “Australian Copper”, which is responsible for producing, distributing and selling copper across the entirety of Australia, charging Australian citizens, Australian businesses and Australian not-for-profit entities for the copper that it produces, distributes and sells on a not-for-profit basis.

Et cetera.

(The resources in Australia are natural gas, coal, iron ore, bauxite, copper sulfide and many other minerals and metals.)

(If Australia had a publicly owned, federal “Australian Bank” that lends without charging interest, then the Australian federal government could finance the cost of paying privately owned mining companies the agreed prices of extracting the resources via the Australian Bank lending to a publicly owned Australian federal government entity named “Australian Mining” (i.e. creating money out of nothing when it lends like banks do, by debiting its asset account named “Loans Receivable” and crediting its liability account named “Deposits”, being the bank account of Australian Mining with the Australian Bank, in order to make the funds loaned available to Australian Mining).

Australia needs a publicly owned, federal “Australian Bank” that lends without charging interest.

Australian Mining would pay privately owned mining companies the agreed prices of extracting the resources and thereby retain ownership of the extracted resources as a publicly owned Australian federal government entity on behalf of Australian citizens.

The loan from the Australian Bank to Australian Mining could be repaid with the funds obtained when these extracted resources are ultimately sold in processed form by the publicly owned Australian federal government entities to which ownership of these extracted resources is transferred (i.e. Australian Mining sells these resources on a not-for-profit basis to cover the costs of extraction of these resources and other necessary costs), being “Australian Electricity”, “Australian Gas” and “Australian Minerals” (comprising “Australian Steel”, “Australian Aluminium”, “Australian Copper”, et cetera), by turning them into electricity, saleable natural gas, steel, aluminium, copper, et cetera, to end-user Australian citizens, Australian businesses and Australian not-for-profit entities.)

The Australian federal government could sell any extracted resources that are surplus to the needs of Australian citizens, Australian businesses and Australian not-for-profit entities, such as extracted natural gas and extracted coal, and any production output that is surplus to the needs of Australian citizens, Australian businesses and Australian not-for-profit entities, such as processed natural gas, steel, aluminium and copper, to other countries, such as Japan, South Korea, Taiwan, Ireland, United Kingdom, Germany, Sweden, Italy, Russia, Canada, United States of America and New Zealand, at prices that exceed the costs to the Australian federal government of extracting the resources or producing the output, in order to obtain the foreign currencies of these other countries, held in foreign banks in these other countries on behalf of the Australian federal government, which can be used by the Australian federal government to:

> purchase goods or services from these other countries, such as motor vehicles from Japan for Australian federal government motor vehicle fleets and military equipment from the United States of America for the defence of Australia

> purchase goods from any one of these other countries on behalf of any given Australian citizen, Australian business or Australian not-for-profit entity, who or which seeks to purchase the goods but needs the foreign currency of the other country before they can purchase the goods, so that the Australian citizen, Australian business or Australian not-for-profit entity can pay the Australian federal government the required price of the goods in Australian dollars on a foreign-currency-exchange basis via a publicly owned Australia Bank (containing the bank accounts of every Australian federal government entity, every Australian local government entity, every Australian citizen, every Australian business and every Australian not-for-profit entity), so that the Australian federal government can authorise the appropriate foreign currency under its ownership in the appropriate amount in the appropriate foreign bank in the appropriate other country to be utilised to pay for the goods on behalf of the Australian citizen, Australian business or Australian not-for-profit entity, so that the goods will be dispatched to the Australian citizen, Australian business or Australian not-for-profit entity by the seller of the goods in the other country