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Less than 20 years of mineral reserves left in North West Qld: More exploration needed

Michael RocheThe lack of mineral exploration currently being conducted in Queensland’s north west could prove disastrous for the state in the very near future, according to the head of the Queensland Resources Council (QRC).

Speaking at the Mining the North West Conference in Mount Isa yesterday, Chief Executive of the QRC, Michael Roche, said current reserves were running dangerously low.

“With proved and probable reserves of copper, silver, lead and zinc likely to be exhausted in less than 20 years, we need to make these new finds now. The urgency is also driven by the ever increasing time it takes to move from resource discovery to mining,” Roche said.

“… we have only 14 years of proved and probable copper and silver reserves; 19 years of lead and 18 years of zinc reserves. And we haven’t exactly had our skates on looking for more,”

“In 2012-13 Queensland recorded a 31 percent decrease in minerals exploration to $732 million. In the first half of 2013-14, there’s been a further deterioration in mineral exploration activity – in Queensland and nationally.”

“Nationally, mineral exploration expenditure in the six months to end December 2013 fell by 31 percent compared with the previous year. The decline in Queensland was even greater, at 36 per cent. Of particular concern to the North West is that base metals exploration in the six months to December 2013 fell by 60 per cent over the previous year.”

While congratulating the state and federal governments for streamlining the project approvals process and removing time-consuming duplications in the system, Roche also warned that any change to the diesel rebate in next week’s budget would have a disastrous effect on an already struggling resources sector.

“One measure we don’t want to see in the Federal Budget is abolition or winding back of the Fuel Tax Credit Scheme. Although there have been encouraging signals in the media yesterday that it will survive this budget, it’s worth putting on the record just how important it is – particularly to operations in the North West,” Roche said.

“This economy-wide scheme is based on the same tax principle underpinning the GST. That is to avoid taxes on business inputs that would distort investment and production decisions. The importance of the scheme is reflected in the fact that diesel accounts for up to one quarter of operating costs at mine where there is no energy supply alternative.”

“Removing the tax credit would impose additional costs of between 4 and 7 percent. It is also

important to note from a competitiveness position, no tax is levied on fuel inputs for mineral

competitors including the United States, Indonesia and Canada.”

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