The Association of Mining and Exploration Companies (AMEC) says an increasing number of challenges to the resources industry will now likely emerge following the Supreme Court of Western Australia’s decision to uphold the appeal in the Shire of Mount Magnet v Atlantic Vanadium.
As previously reported, the Shire of Mount Magnet can levy rates on land covered by Atlantic Vanadium’s miscellaneous licences. A miscellaneous licence is for purposes such as a railway, roads and pipelines, or other purposes prescribed in Regulation 42B of the Mining Act 1978.
AMEC Chief Executive Warren Pearce says there is an increasing number of hurdles for the resources industry to jump through to succeed.
“It is yet another burden placed on the resources industry,” Pearce tells this news service.
Numerous mining companies have reached out to AMEC regarding the court’s recent decision.
Pearce says companies are reaching out to make AMEC aware that if this decision spreads further to other local councils, companies will reconsider current and future projects.
AMEC reports that the resources sector could be facing a $250 million additional rate bill in 2025. Numbers provided to AMEC put conservative estimates at $50 million per year to the broader industry.
“This estimate has been devised by using last year’s rate in the dollars applied by local governments to mining and exploration tenements, and the value of tenement rental fees,” Pearce tells this news service.
“It assumes that all of the approximate 3,700 miscellaneous licences would be rated by local governments.”
Pearce notes that the junior end of the market will feel the frustration the most as they are “being treated like an ASX Top 100 mining company”.
“Not all explorers and mining companies have billion dollar profit sheets of the majors,” the CEO says.
“In terms of cost, the largest players will see most of the cost. However, the issue is for the smaller miners and developers they have to often have multiple scenarios covered by tenure whilst they are going through development when they can at least afford to be hit by these additional costs for no benefit.”
AMEC has spoken with the Mines and Petroleum Minister David Michael and Local Government Minister Hannah Beazley regarding the potential legislative intervention. The association has stated that there needs to be legislation to preserve the principal that miscellaneous licences are not, and should not, be rated.
“The government is aware of the urgency of this development and has assured the industry it is looking into the matter as a priority,” Pearce adds.
AMEC is also in discussion with Atlantic Vanadium as to what their next steps are and whether the company will appeal the decision supported by the industry.
Pearce notes at the moment, AMEC’s priority is for the Western Australian Government to address this legal loophole through amended legislation.
Write to Aaliyah Rogan at Mining.com.au
Images: AMEC
