Inside Queensland’s bid to claw back $66 million from Fortescue
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Queensland lost several economic opportunities, including the potential to foster an emerging export hydrogen industry worth $1.7 billion a year, the state government will argue as part of its $66 million claim against mining giant Fortescue.
The government has now called in several experts, including major consulting firm KordaMentha, to prove its economic loss in its fight against Fortescue, owned by iron ore billionaire Andrew Forrest.
Fortescue is fighting against claims it breached its funding agreement with the state for its green hydrogen facility in Gladstone, central Queensland.
Fortescue boss Andrew Forrest in Gladstone alongside former premier Annastacia Palaszczuk and her then deputy, Steven Miles.
The resources giant dumped the project at the same time it canned a similar one in Arizona in 2025, when US President Donald Trumpslashed tax breaks for clean energy investments.
The Queensland site has previously been described as a “vanity project” and a “terrible deal” by Deputy Premier Jarrod Bleijie.
As part of Supreme Court documents filed in recent weeks and seen by this masthead, the state has indicated it will file an amended claim. An order made by the court late last month gave Fortescue until July 22 to apply to have the new claim struck out.
The government has indicated it would argue for damages based on claims that it lost multiple economic opportunities, including the potential to foster an emerging hydrogen industry worth $1.7 billion in exports annually, according to recent submissions.
If Fortescue had upheld its end of the deal, it would have meant the electrolyser manufacturing facility would have continued to operate until 2032, Queensland claims.
That facility would have enabled Queensland to potentially become a global leader in the production of green hydrogen for export. Queensland would also have been well placed to capture the opportunity of future increases in international demand for green hydrogen, according to the documents.
A former government source familiar with Fortescue’s original pitch but not authorised to speak on the record told this masthead the mining giant said the project would support 48 ongoing high-end manufacturing roles.
Andrew Forrest and former Labor leader Annastacia Palaszczuk in 2021.
Queensland was also told the site at Aldoga, central Queensland, could potentially lead to the company securing various future projects, such as manufacturing for battery, wind turbines, cables and solar power systems.
In the state government’s claim, it said the development of the industry in Queensland would have enabled it to capture emerging large-scale hydrogen markets in Asia, particularly in South Korea and Japan.
The state said it had become apparent following a first review hearing of the case that Fortescue had “misconstrued” the nature of the government’s case, which was that it would seek to prove the economic benefits flagged from helping to get the industry off the ground were reasonably expected.
The funding agreement came after Fortescue sent a letter to the government in May 2021 regarding the project, to which the state responded that Fortescue’s plan aligned closely with Queensland’s policy priorities.
The proposed manufacturing facility near Gladstone.
The agreement came against a backdrop of the then Labor government, led by Annastacia Palaszczuk, implementing the Queensland Advanced Manufacturing 10-year road map and action plan.
According to Supreme Court documents, the then premier said: “Now the world is looking to hydrogen, and we want them to get it from Queensland so we can create even more jobs in our regions.”
Palaszczuk also spoke of the emerging industry having enormous economic benefits for Australia, pointing to the $1.7 billion export figure.
Fortescue claims, however, the government has no leg to stand on.
It says the funding agreement did not refer to the Hydrogen Industry Strategy or the 10-year road map.
In launching its defence, the company said the alleged loss and damage did not flow from the claimed breach of the funding agreement.
Fortescue said the Hydrogen Industry Strategy was only expressed to apply between 2019 and 2024 and came to an end in 2024.
“The state would have, in any event, abandoned the Hydrogen Industry Strategy as it, in fact, did in or around October 2024, or alternatively February 2025, or alternatively October 2025,” documents filed on behalf of Fortescue state.
Those dates coincided with the October 2024 state election, which resulted in a change of government. The new administration, under LNP leader David Crisafulli, removed the strategy from the government’s website.
According to Fortescue, in February 2025, the state withdrew financial support for the Central Queensland Hydrogen Hub – the state’s flagship $12.4 billion green hydrogen project led by Stanwell Corporation. And in October 2025, the state released the Queensland Energy Roadmap, which made no mention of any hydrogen industry policies.
“The state would have, in any event, abandoned the 10-year road map as it, in fact, did in or around September 2025,” the documents state.
Fortescue also pointed to how in September 2025, the state released the Transforming Queensland Manufacturing Strategy 2025-30, which made no reference to any hydrogen industry strategies and said the state had not suffered the alleged loss because it had obtained the benefit of at least $37,222,506 in site work costs from stage 1 of the project.
The company’s legal team also questioned why another company would not take up the commercial opportunity at the site, and it pressed the state as to why it would not take up the opportunity, given that it had now exercised the buyback right.
The industrial site in central Queensland remains abandoned and there are no current plans to either sell or contract a new company to work there, this masthead has confirmed.
According to documents recently filed by the state, the government’s identified witnesses to be brought in would include an economic expert to analyse the financial benefits that were expected to flow to Queensland from the agreement.
The state said it had already engaged Synergies Economic Consulting to provide an expert economic report, in addition to KordaMentha’s expert accounting context.
Other expected witnesses include a hydrogen industry expert to give evidence concerning the market and potential market for the electrolyser technology and for green hydrogen internationally, both at the time the agreement was entered into and the likely trajectory and future prospects of the market through to 2032 and beyond.
The state’s documents say in the six months ending in December 2020, Fortescue had a net profit after tax of $US4.1 billion.
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Cloe Read is the crime and court reporter at Brisbane Times.Connect via X or email.
James Hall is the News Director at the Brisbane Times. He is the former Queensland correspondent at The Australian Financial Review and has reported for a range of mastheads across the country, specialising on political and finance reporting.Connect via X or email.