Queensland’s mineral explorers are to gain a two-year expenditure reduction as they struggle through the global mining downturn.
Minister for State Development and Minister for Natural Resources and Mines Dr Anthony Lynham said the 50 per cent concession would provide much needed financial relief to explorers and ensure meaningful exploration did not stall in Queensland.
“We will support up to a 50 per cent reduction over two years in the expenditure that an explorer is required to commit under their mineral exploration permit,” he said.
“For example, say there is a base metal explorer in the North West Minerals Province that holds multiple mineral exploration permits with a combined committed exploration expenditure of $2 million for the two years.
“The concession means up to $1 million they don’t have to spend to meet their exploration permit conditions.”
Dr Lynham said the concession would apply to companies exploring for all minerals other than coal and the government was investigating extending the concession to the coal exploration sector.
“We’ve listened to industry – the Queensland Exploration Council, the Queensland Resources Council and the Association of Mining & Exploration Companies – and they tell us that it’s difficult to attract investment capital in this tough global mining climate,” he said.
“Our response is practical assistance that removes some cost pressures.
“Mineral explorers will have greater flexibility to spend their exploration dollars on the ground where it is needed most.
“This adds to our existing initiatives to support a competitive resources sector, including:
- developing a Queensland Gas Supply and Demand Action Plan to encourage further exploration of the State’s highly prospective petroleum and gas resources
- meeting election our commitment to a royalties freeze.
- having the lowest payroll tax rate in the country
- investing heavily in innovation.”
Dr Lynham said explorers would still be expected to undertake meaningful exploration to advance the geological knowledge or prospectivity of their tenure and meet their other obligations, including environmental obligations, annual rents and relinquishing sub-blocks.
The news was welcomed by Queensland Resources Council chief executive Michael Roche, who called it “welcome relief”.
“This initiative will provide much needed relief to mineral explorers across the state in places like Cape York, Mount Isa and operations west of Townsville and Cairns,” Mr Roche said.
“This is an example of how government can partner with industry to provide incentive and some breathing space in tough times without providing a handout or subsidies. QRC also welcomes the fact that the Minister is investigating extending this policy to coal explorers whose circumstances are really no different to that of mineral explorers.
We look forward to having the opportunity to discuss with the Premier and the Cabinet Jobs Committee, a wider partnership plan to provide breathing space for the resources sector or, as the Minister told the Parliament today: “Giving time for the market to recover.”
“As QRC foreshadowed last week, jobs losses are an inevitable fact of the current severe cyclical downturn in commodity prices but there are areas where Government can partner with industry to alleviate the costs of doing business in Queensland to ensure we remain globally competitive and investment in existing and new projects continues.”