Indigenous leaders have expressed worries yesterday that the federal government's proposed super profits mining tax would turn away mining companies who are in the middle of title claims negotiations with traditional owners of their project sites.

Aboriginal expert Marcia Langton said that small mining companies could be discouraged by the proposed measures that would impose 40 percent tax on above normal profits culled from Australia's non-renewable resources.

She said companies could pull out of project sites which could result to a reduced amount of infrastructure and funds allocated for the indigenous communities, stressing that aborigines "would have no income at all because the project's closed."

Ms Langton said that the plight of the indigenous communities is a valid concern and must be included in the raging super profits tax debate, as she asserted that the communities hold the "simplistic view that the mining industry is highly successful and it will always look the way it does."

Meanwhile, Xstrata has joined the ranks of the growing list of companies which are suspending their mining projects and putting the blame on the proposed tax, as it announced that it is holding off two Queensland projects worth closed to $600 million.

The company said that the Queensland explorations could have created 3,250 jobs, which could have delivered benefits on the area's residents, including that of the indigenous communities.

Still, Prime Minister Kevin Rudd has been largely left unfazed by all the controversies sparked by the super profits tax, as he stressed that the government would not be intimidated by the mining companies.

He gave assurance though that the government is willing and in fact, still negotiating the ideal profit level from which mining companies would be taxed, as he gave hints that it should hover around the government bond rate of six percent.