PERTH (miningweekly.com) – The Western Australian government has released its tenth round of the exploration incentive scheme (EIS) offering A$4.69-million to 41 drilling and prospecting projects in the region.
Mines and Petroleum Minister Bill Marmion said the scheme was helping to underwrite Western Australia’s continued prosperity.
“This is an important investment in the state’s future, particularly in the challenging financial environment faced by exploration companies. Now in its sixth year, this highly competitive drilling programme has resulted in major discoveries, with more being made every year.”
The co-funded drilling programme refunds up to 50% of direct drilling costs with caps of A$150 000 for a multi-hole project, A$200 000 for a single deep hole, and A$30 000 for a prospector’s project.
Round 10 of the EIS attracted 74 applications requesting A$8.77-million in co-funding, Marmion noted.
The Minister added that the state government had committed a further A$10-million a year to the EIS until the end of June 2017, bringing the total spend on the EIS to A$130.27-million.
The Association of Mining and Exploration Companies (Amec) said that the latest round of funding would be a much needed boost to the exploration and support services sector in Western Australia.
“The co-funded greenfields drilling programme was an initiative recommended by Amec to stimulate the sector and is now in its sixth year. It has resulted in millions of dollars being spent directly on innovative greenfields exploration in Western Australia. It has contributed to many successful discoveries including the Nova and Camelwood nickel deposits,” said Amec CEO Simon Bennison.
“Programmes such as the EIS are essential to stimulate investment in greenfields mineral exploration, which has been declining in favour of brownfields for more than a decade. In the September 2003 quarter, 46% of total metres drilled was on new deposits. In the September 2014 quarter, just 24% of total metres drilled was on new deposits.”
Bennison noted that despite statistics from the Australian Bureau of Statistics, which indicated that drilling in areas of new deposits rose 28.5% from the June quarter to the September quarter, investment in greenfield exploration was still historically low.
“The 397 000 m drilled on new deposits in the September 2014 quarter is still lower than the March 2013 quarter,” he added.
Meanwhile, Bennison called on the state government to keep royalty rates, fees and charges steady, saying this would ensure initiatives such as the EIS were successful in increasing exploration spend.
“The government should instead focus on improving timeframes and reducing duplication across all approvals processes.
“We must find a much better balance between capital going offshore, to countries with more attractive economic environments, compared with investment in Australian projects. In 2013, 67% of capital raised on the Australian Securities Exchange went to offshore projects. This reduces the rate of discovery in Australia,” said Bennison.