Listen Now
Getting your Trinity Audio player ready...

Mineral Royalty Reform

The Northern Territory Government has begun 2024 on the front foot, with two rounds of consultations on the changing mineral royalty scheme.

AMEC has been campaigning for a change in the mineral royalty system in the Northern Territory (NT) for the last seven years and finally the NT Government is set to introduce a new tiered ad valorem system. There will be four tiers based on the level of processing of the mineral.

  • Category 1: 7.5% (crushing, screening, blending and product handling)
  • Category 2: 5% (gravity separation or flotation)
  • Category 3: 3.5% (metallurgical treatment stages can require high temperatures and pressure treatment with a variety of chemical and energy inputs)
  • Category 4: 2% (final treatment, refining or other advanced metallurgical processing          

This is both a big win from an advocacy standpoint, as well as for the mining and mineral exploration industry and NT economy. Replacing the complicated profit-based royalty system with one better understood by industry and investors should provide further interest in exciting projects in the Territory. As well as incentives for new companies to choose the Territory as a place to explore.

Environmental Legislation

With the passing of the Environment Protection Legislation Amendment Act 2023 in November last year, implementation is well underway. The new mining laws will commence on 1 July 2024 and apply to all mining activities including exploration and extraction.

AMEC has successfully advocated for an Eligible Mining Activities (EMA) style approach to the lowest tier of licencing being introduced in the NT. AMEC has advocated for over 15 years in Western Australia for this concept, so to see it being implemented in the Territory is good to see.

The proposed risk criteria which is derived from the EMA model is:

  • Nature of activities – limiting certain types of activities
  • Scale of activities – limiting the size of disturbance
  • Location – excluding environmentally sensitive areas

Currently, the Department of Environment, Parks, and Water Security (DEPWS) has set the scale of activity at 10ha of disturbance. This is massive for the exploration industry as it should cover up 80% of all environmental licensing under the new reforms.

AMEC will be meeting regularly with DEPWS and DITT to discuss the risk criteria and standard conditions alongside the implementation of environmental legislative reform.