Statement by Queensland Exploration Council Chairman Geoff Dickie on EDI Funding
The Queensland Exploration Council (QEC) is disappointed that there is no future funding allocated in the Commonwealth Budget for the Exploration Development Incentive (EDI).
The EDI has operated since 2014-15 and encouraged shareholder investment in small exploration companies undertaking greenfield mineral exploration. A government review into the effectiveness of the EDI has been conducted over the past year but the final report has not yet been delivered. The government appears to have withdrawn funding before adequately considering the findings of the review.
A number of QEC member organisations have utilised the EDI since the scheme was introduced in 2014-15. The incentive was modelled around elements of a similar scheme that operates in Canada. Such a scheme requires a longer term commitment from government to maximise the value to the exploration industry. The flow-through share scheme in Canada has been operating for about 40 years and the Canadian Government has recently extended the scheme. In addition, many Canadian provinces provide additional incentives for individuals to invest in exploration projects.
Exploration is the lifeblood of the minerals industry, and funding has been scarce during the recent mining industry downturn. Removing future funding for the EDI will lessen Australia’s attractiveness from an exploration investment standpoint, particularly compared to the likes of Canada.