Despite a 29 per cent jump in exploration expenditure from the March to June quarter, mining lobby groups maintain the industry still needs Government support.
They argue that Federal incentives such as tax breaks in the sector and greater public spending on geological research will boost Australia’s declining exploration levels, as well as flatten the cyclical trends of the industry.
Much of the industry was angered earlier this year when a flow-through tax scheme, and funding to support increased levels of pre competitive geo-scientific information, were absent from the Federal Budget.
The issue of government support appears to have gone off the radar since then and the recent increase in exploration spending only strengthens the Government’s stance.
But Association of Mining and Exploration Companies president David Harley said the issue was far from over.
“The argument is still very strong,” he said.
While he acknowledged the increase in exploration, Mr Harley said most of it was being conducted on or around existing projects and that, seasonally, the June quarter was one of the best times to explore.
Mr Harley said there was still very little greenfields exploration being undertaken, which was needed to replace Australia’s existing mines and maintain its strong position in the global mining industry.
He said while investors were investing in projects nearing production, raising capital for greenfields projects remained difficult.
“Alright, we are seeing an increase in exploration expenditure because of an increase in commodity price increases but it is pretty subdued compared to previous events, dare I say it,” Mr Harley said
That issue could be raised before the coming election, he said.
While the Government has rejected the items in the budget, the Opposition has already indicated its support for a flow-through share scheme.
Chamber of Mineral and Energy policy and external relations director David Parker said while the increase was welcome the industry was seriously concerned that the Mineral Action Agenda was awaiting implementation.
“It still does require a fair amount of attention of effort on behalf of the Federal Government,” he said.