Leader of The Nationals WA Mia Davies says the time is right to supercharge the Exploration Incentive Scheme (EIS), which the Labor Government threatened to de-fund in 2018.
Ms Davies said the mining and mineral exploration industry, which supports around 100,000 FTE in WA, was often one of the first casualties of the resources sector during economic downturns.
“Some companies are deferring or scaling back their exploration programs as a result of COVID-19, which is not a good outcome for the sector or the State’s economy,” she said.
“Stimulating exploration by boosting the EIS will help maintain and create jobs as we look towards the economic recovery post-COVID-19.”
When in government The Nationals WA supercharged the EIS via Royalties for Regions to about $10 million per year, investing more than $130 million in the program between 2009 and 2017.
An ACIL Allen economic impact study published in 2015 found the EIS returned $23.7 million to the WA economy for every $1 million invested.
By early 2012 exploration investment in WA reached record levels of more than $570 million for the quarter. Flow-on benefits of the EIS ranged from generating more exploration and construction activity to additional taxation and new net wealth generated by the development of new mines in regional WA.
Ms Davies said the Labor Government signaled halving the EIS in 2018-19 before changing the program’s funding model to come from Mining Tenement Rates in July 2019.
“Despite the program’s clear success, the Labor Government has threatened to drop the program and now bastardised its funding model,” she said.
“Not only should the current funding model be revised, the amount should be boosted by an additional $5 million per year to push the co-funding component beyond 50 per cent.”
The Nationals WA mines and petroleum spokesperson Jacqui Boydell said co-investment of up to 70 per cent would create a self-sufficient program while driving exploration activity at the same time.
“This would be particularly beneficial to junior explorers that find it difficult to raise capital for continuing or expanding operations,” she said.
“There is a clear pattern – since we introduced the EIS WA has featured at the top of the nation’s quarterly mineral exploration expenditure more times than any other state.
“The policy and program already exist, so with some minor tweaks and a little more support from Government the value from greenfields exploration in WA can be extended.”