Northern Territory changes the way mineral royalties are calculated
The Northern Territory has introduced the Mineral Royalties Bill 2024 to change the way mineral royalties are calculated in the Territory.
From July 1, 2024, there will be a new ad valorem royalty scheme for the calculation, payment and administration of mineral royalties for new mines that begin from 2024.
The current profit-based mineral royalties scheme outlined in the Mineral Royalty Act 1982 will be exempt for all existing mines that were in production in the 2023 calendar year.
The Northern Territory’s current mineral royalty scheme was developed in the 1980s and has been subject to numerous amendments.
In 2021, the Mineral Development Taskforce (MDT) was established to identify and investigate opportunities to accelerate investment in new mining projects.
In April 2023, the MDT released its final report with a key recommendation to replace the Northern Territory’s existing royalty scheme with an ad valorem scheme that is simple, competitive and modern.
This new scheme incorporates four mineral treatment categories, applying four royalty rates that balance competitiveness with other jurisdictions while ensuring the Territory receives a fair return for its natural resources.
These four royalty rates include 7.5% for the least refined minerals, 5% for concentrates, 3.5% for chemically refined minerals and 2.5% for final or highly processed minerals.
Northern Territory chief minister and treasurer Eva Lawler commented on the royalties.
“Lower loyalty rates will apply to project that have committed greater investment and created more employment in the Territory by mining minerals that will be processed right here, creating supply chains and boosting local jobs,” she said.
“The Territory has abundant natural resource, including the critical minerals the world needs to tackle climate change and transition to renewables.
“Right now, we are in a position to set our course for a mining industry that is not only profitable to the Northern Territory economy, but also support the energy transition to renewables.”
