A community is reeling after its long running mine was mothballed with claims it has been caught in the crossfire of a state's coal royalties debate.

A mayor has called on the Queensland government to sort out the royalties issue, saying her region has "had enough" after being hit hard by a mining giant's announcement.

BHP Mitsubishi Alliance will axe 750 jobs across the state and place a Bowen Basin mine into care and maintenance from November.

The alliance took aim at Queensland's coal royalty scheme after confirming the job cuts and its decision to mothball the Saraji South project located in Isaac Regional Council.

It sparked calls from mining lobby groups for reforms but Queensland's Liberal National government refused to make any changes to the state's progressive royalty regime

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