CANBERRA, May 5 (Reuters) – Australian Prime Minister Kevin Rudd told miners on Wednesday he would stand firm behind his planned 40 percent tax on resource profits as the industry intensified its campaign to overturn the election-year move.

Executives from the country’s outraged mining industry, dominated by giants Rio Tinto (RIO.AX)(RIO.L) and BHP Billiton (BHP.AX)BHP.L put their case to Rudd at a closed-door breakfast in Perth, and to opposition conservatives as well.

“I was very forthright in why we believe it’s necessary,” Rudd told local radio. “It’s obviously controversial. I don’t walk away from that,” he said.

He drew some comfort on Wednesday from credit rating agency Fitch which said the new tax would not lead to credit downgrades among miners, though it could jeopardise some investment.

“This news does not mark the beginning of the end for the Australian mining industry. Demand for their product is simply too strong,” Fitch said in a statement.

Rudd’s Wednesday talks followed a Tuesday dinner meeting with Fortescue Metals (FMG.AX) CEO Andrew Forrest, BHP Billiton iron ore chief Ian Ashby, Rio Tinto director Sam Walsh and Woodside Petroleum (WPL.AX) CEO Don Voelte.

The conservatives have already indicated they will oppose the tax in the upper house of parliament, where Rudd’s centre-left government lacks a majority and where the conservatives need just one other non-government vote to defeat the tax.

“I can’t see how we could ever support it,” opposition finance spokesman Andrew Robb said on Wednesday.

“This is a monstrous action and my expectation is that this won’t come to the parliament until next term. My expectation is that it would be either dumped or fundamentally changed.”

For full coverage of the tax, click on [ID:nAUTAX]

BHP BILLITON BOSS: LONG CAMPAIGN AHEAD

BHP Billiton Chief Executive Marius Kloppers indicated on Wednesday that the mining industry was prepared for a long campaign against the new tax, which has already prompted one small miner, Cape Lambert (CFE.AX), to dump an iron ore project.

“We’ve got a long job ahead of us,” Kloppers told reporters as he entered Parliament House for talks with opposition leader Tony Abbott. The head of rival miner Rio Tinto’s Australian operations, David Peever, also met Abbott.

The government announced on Sunday that the 40 percent tax would be levied on so-called super profits of miners from 2012 onwards and proceeds used to fund company tax cuts, boost retirement pension savings and build infrastructure.

The mining tax has rocked mining stocks in Australia and Europe, contributing to a 2.6 percent fall on the London market. BHP Billiton’s UK-listed shares fell almost 8 percent.

Fitch estimated the tax would lift the annual tax bills of Rio Tinto and BHP Billiton by more than a collective A$3 billion ($2.73 billion), out of combined total earnings before financing costs of around A$125 billion over the past three years.

Treasurer Wayne Swan accused miners on Wednesday of making extreme claims against the new tax and senior government sources were quoted in Fairfax newspapers as saying the 40 percent rate was non-negotiable.

“There’s no doubt from some parts of the industry there is a fear campaign,” Swan said. “This is a very, very important issue for Australia, terribly important that Australians get a fair share of their mineral resources.”

The government is likely to wait until after the next election, expected late this year, before legislating for the new tax in the hope that the new Senate will be less hostile. But political analysts say those hopes are likely to be dashed.

($1=1.099 Australian Dollars)

(Reporting by Rob Taylor; Editing by Mark Bendeich)