Mining Law
Mining law is a very broad topic, but basically, Mining and Mineral exploration law is dealt with under the New South Wales System of Regulation under the Mining Act 1992 and the Petroleum (Onshore) Act 1991 and accompanying Regulations. These acts of parliament are essential in order to understand the way that the the regulation of mining operates in New South Wales. Many people are unaware that despite owning land, you do not necessarily own the mineral titles which are found on the land and that these can be resumed by the government if there is no license. For this reason a mining licence is necessary to establish the correct title to a mine if the minerals are under the jurisdiction of New South Wales Law. Administratively, this area is handled by the department of primary industries in New South Wales.

The Mining Industry has a large body of law and regulations
The Department fulfils a number of functions in the administration of mining title in New South Wales. It creates records of exploration licenses, assesses leases and processes mining lease applications. The headquarters of the Department of primary industries in New South Wales is Maitland. The department keeps a register of mineral titles and prospecting licenses. The Department also maintains the computerised Title Administration System (TAS). The overall function of the system of mining title is to provide the control mechanism for government by allowing the government to dictate the operating and environmental conditions of mineral titles in the state. The present system of title also gives the owners of the title the exclusive right to explore the land for which a license is granted and mine the minerals which are on the land as long as the conditions of the license are correctly adhered to in the operations of the exploration or the mine. Naturally, when a business is investing in a major infrastructure project there is a need for certainty as to the commercial rights which the business operators can expect as a result of their investment and the system of licensing provides this.
The relevant legislation which governs the operation of most of the aspects of mineral resource extraction in New South Wales are the Mining Act 1992, The Petreoleum (Onshore Act) 1991, the Offshore Minerals Act 1999 (for title up to three miles offshore) and the Petroleum (Offshore) Act 1982 and beyond this three mile limit, offshore drilling and exploration is regulated by the Commonwealth Government in conjunction with the State body. If you have a question about mining law, or the rights of mineral tenants on leases, or the rights of the land holders of the lands in which mining leases have been granted, we can assist you with any aspect of these inquiries. Please do not hesitate to contact us using any of the methods available on this website.
Recent Legal Information
Miners Tax Lawyers rejoice as legal deal is done with Julia
By Legal Services Australia on July 1, 2010
The meeting today between Julia Gillard and BHP, Rio Tinto and Xstrata appears to have resulted in a peaceful resolution to the mining tax war which was developing between the Government and the Australia’s largest mining companies. The points of compromise appear to have been where the kick in rate for the tax comes in which was previously set at 5% and it has now been agreed that it will be at 12% as well. It also appears that a the government has given ground on the two biggest objections of the Mining industry. The first of these was that the tax would be retrospective. The mining companies can now avoid the costly taxation over the Pilbara mines in Western Australia and the rich coal reserves along the east coast of Australia as these are existing assets and the government appeared to accept that it would not make the tax retrospective in its application. This is a very large concession. It is also one which could potentially have flared a constitutional argument against the tax because retrospective legislation is only of questionable constitutionality. The other major concession which the government seems to have given is that it now accepts that 40% was too high as a tax on the Miners and some slightly lower figure will now be accepted. The proposed tax was the highest in the world by a long shot, with only Norway’s Oil Super-Profit Tax coming close in terms of its rate of profit capture.
Naturally, the imposition any greater amount of taxation is an imposition on industry which will make it less competitive internationally and prevent the Australian Mining industry from growing and creating more jobs (which would in turn yield greater tax revenue). However, this argument is not accepted by the government. Under Mr Rudd’s watch, an enormous government debt accumulated and this must now be repaid in some method, the mining tax appears to be the popular tax that the government can think of to fill this giant hole in its budget.
Mining Law and the Resource Super Profits Tax
By Legal Services Australia on June 19, 2010
According to the current proposal by the government for the new mining tax, the so called Resource Super Profits Tax (RSPT) is due to be introduced on 1 July 2010 at a rate of 40% on the profits made from the exploitation of Australia’s non-renewable resources.
Why is the government doing this?
The present government has stated that the exploitation of Australia’s wealth of natural resources does not currently provide a fair return to the Australian community. Although there is no empirical evidence given to verify this, the government believes that the imposition of the new tax will increase employment and investment in the resources sector. There is no explanation as to how this is likely to occur, in traditional economics the imposition of a new tax is likely to reduce employment and investment in a sector where greater taxation is applied. However, the economic argument for the tax is that compared to the current system of taxation which is based on royalties rather than a proportion of profit the new RSPT will only impose taxation where the businesses are profitable. It could be argued that this is misguided because it removes the possible initial incentive for mining prospecting or the mining entrepreneur to invest because in an already risk laden business, losing 40% of the profit to taxation in addition to company income tax would be a serious disincentive to invest or to employ new staff. The government also argues that it will reduced national uncertainty be creating a nationwide uniform system of taxation for mining which may be true, but it will also be a new tax system that will be difficult to administer the compliance costs of many businesses will go up as they attempt to identify their exact obligations under the new system of taxation. It is also argued that this profit based resource taxation is used in countries such as Norway (50% on oil), Canada and the United States. However, with the exception of Norway’s tax on oil super profits, these other taxation systems do not exceed 20%. There is therefore very little evidence that the tax will work int he way that the government predicts. It will most likely do enormous damage to Australia’s national economy and prevent our largest export industry from performing competitively in an already globally competitive market.
Are the any exemptions of ways of reducing the tax?
One respite which mining companies may find in relation to this new tax is that the crude oil excise is going to be abolished a the same time as the imposition of this new tax. Resource companies will also be able to elect to stay with the current Petroleum Resource Rent Tax (PRRT) of move over onto the new tax system, although once this decision has been made it will not be capable of being reversed. It will also be possible to obtain credit for royalties paid to state governments in relation to the tax. Perhaps the most important element of the new tax proposal is that the basis of exemptions as they are proposed is that if there is no net benefit to society of applying the as in the case of minerals which are not super profitable or in the case of microbusinesses which face large compliance costs then it would be unlikely that the tax would be applied according to the current proposal.
http://www.legallawyers.com.au/mining-law/