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21 May 2002
The Hon. Ian Macfarlane MP Dear Minister,Proposed Action Agenda for Mineral Exploration I am writing to support the proposal for a “whole-of-government” Action Agenda for Mineral Exploration. As you are aware, the resource industries underpin the wealth of the nation by virtue of their export earnings. For this wealth to be sustainable it is essential to discover new high quality mineral deposits. Since 1996/97, mineral exploration activity in Australia has declined from an expenditure rate of about $1.2 billion per year to about $700 million per year at present.
At the same time the success rates for new discoveries have been very disappointing. Without new discoveries our national wealth will be threatened.
The Australian Geoscience Council therefore strongly supports the proposal for a Whole of Government Action Agenda to boost exploration activity.
We have identified the following key issues, which need to be addressed:
1. Improving land access for mineral exploration The AGC supports the principle of Native Title. We recognise that Aboriginal heritage, culture and land custodianship must be protected, with appropriate wealth sharing at the mining/production stage, when the new wealth is generated. However, the present arrangements inhibit exploration by the very complexity of the processes in place. It appears that large amounts of money are being spent on legal advice, and the aboriginal community appears to receive little or no benefits. Only the largest mining companies can now afford the time and expense to gain access to land. However, companies like BHP/Billiton and Rio Tinto prefer to grow through the acquisition of smaller companies. Several of these have decided to shift their exploration focus away from Australia to other countries where it is easier to explore. Simplifying the arrangements for ‘Land Access’ to explore is crucial for a recovery to take place in mineral exploration. 2. Financial incentives for mineral exploration and development To stimulate new exploration activity, we need financial incentives, particularly for the smaller companies exploring in “Greenfield” areas. In other words we need to attract venture capital globally so that Australia becomes a more attractive place to explore for mineral resources. At present a high proportion of exploration budgets are spent adjacent to known resources. For long-term sustainability we need to explore in new areas. These activities will also benefit regional Australia and generate new infrastructure. However, it is very important to achieve the right mix of financial incentives so that the taxpayers’ money is properly invested. 3. Provision of geoscience information and geoscience research For exploration to be successful we need high quality geological and geophysical data sets from both the Commonwealth and the States and Territory to identify areas of interest. We also need top flight research to develop new ideas on how, where and when ore bodies are formed.
As your colleagues Dr Nelson stated in his first media release on research priorities: Australia should “focus its research effort on particular areas in which we have world class, leading edge capabilities” and where “they have the potential to deliver significant economic and social benefits to the Australian community.” Geoscience should clearly be a high priority area under these criteria. Finally, the Action Agenda should also cover the mineral processing side of the resource industry. It is all very well to discover an ore body but to make it economic we need the knowledge to extract the minerals economically. Australia has a strong capability in this area but we need to ensure that this is maintained by high quality research so that our leadership is maintained.
We believe that the above three issues are crucial to the sustainability of the mineral industry in Australia, they are related to several portfolios within the Commonwealth Government and would form the core of an Action Agenda to increase exploration investment.
We look forward to your support on this issue.
Yours sincerely, Dr David Denham |
The Australian Geoscience Council Inc. © 1999 - 2003 |
