Lack of exploration funding in QLD budget

While the QRC has lauded the Queensland budget as solid and responsible, the Association of Mining & Exploration Companies says the government has scrapped a key exploration drilling initiative.

Queensland Treasurer Curtis Pitt handed down a $49.9 billion budget on Tuesday.

The budget is predicted to achieve a $962 million operating surplus in 2014-15, rising to $1.2 billion in 2015-16.

Minister for State Development and Minister for Natural Resources and Mines Dr Anthony Lynham said the State Budget delivered funding for key sectors across the natural resources and mines portfolio.

“The agriculture and resource sectors are vitally important to the state economy for the jobs, regional growth and significant economic benefits they deliver for all Queenslanders,” Lynham said.

“This budget provides funding to support these sectors in challenging times and to ensure the ongoing sustainable management and use of our land, water and mining resources.

“The first Palaszczuk Government Budget will deliver better online services, boost coal seam gas compliance and manage public safety risks associated with abandoned mines.”

These initiatives include: 

  • $6.2 million for the Abandoned Mines Land Program to manage the public safety risks associated with abandoned mine sites across Queensland.
  • $3.6 million to fund compliance activities by the Coal Seam Gas Compliance Unit.
  • $13.7 million, including $7.8 million in capital funding, to modernise and enhance departmental online services to deliver faster service outcomes and make it easier for people to do business with the Department of Natural Resources and Mines.
  •  $2.2 million to address immediate native title trial costs and help accelerate the resolution of all outstanding Queensland native title claims through the Federal Court.

 

For regional Queensland, QRC said it was delighted to see that the budget delivers the government’s $200 million Building our Regions program a year earlier than promised. As part of that program, the budget sets aside $55 million over the period 2015-16 and 2016-17 for the Royalties for Resource Producing Communities Fund. 

QRC CEO Michael Roche said the budget has made smart use of the state’s financial assets to deliver reduced budget debt and substantial savings in interest costs.

“For the state's resources sector, it is particularly notable for delivering on the government's pre-election commitment to royalty stability,” Roche said.

“In calculating likely royalty revenues, the Treasury has sensibly adopted some realistic and achievable assumptions about coal prices for the year ahead, while adopting a conservative exchange rate assumption.”

However CEO of the Association of Mining and Exploration Companies (AMEC) Simon Bennison accused the government of overlooking the mining and mineral exploration sector.

Bennison said he is extremely concerned that the government has ceased funding for the Collaborative Drilling Initiative. From 2016-17 the Geological Survey of Queensland Future Resources program is no longer funded.

“This will make Queensland the only Australian jurisdiction without a co-funded drilling program to encourage exploration,” Bennison said.

“Exploration is the key to making new discoveries that will become the mines of tomorrow to generate jobs and revenue streams for the benefit of the state.

“The program has demonstrated significant economic value and returns to the State over the past nine years. For the $5.56 million that has been provided to 48 companies since 2006, these companies have spent more than $17.3 million on exploratory drilling.”

Bennison was more positive about the other measures in the budget which will act to help the sector, including the government’s commitment to developing a pipeline of priority infrastructure projects to inform Queensland’s current and future infrastructure needs and priorities.

“These initiatives have the potential to deliver a holistic and integrated approach to Queensland’s infrastructure as long as adequate consultation between industry and Government is afforded,” Bennison said.

“Much more needs to be done to reduce costs and barriers to entry for mineral exploration and mining in the state.

“The government needs to engage with industry in order to grow the sector to provide the jobs and revenue streams for generations to come.”

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