The Mineral Royalties Bill 2024, passed in the NT Legislative Assembly on 21 May 2024, it introduces a new ad valorem royalty scheme for the calculation, payment and administration of mineral royalties and is based on the principle that royalty is applied to only the value of the mineral resource produced.
The ad valorem royalty scheme commences from 1 July 2024 and will be applied to new mines from 2024. Existing mines that were in production in the 2023 calendar year will be grandfathered under the profit-based mineral royalties scheme contained in the Mineral Royalty Act 1982.
These changes are an outcome of the recommendations made by the Mineral Development Taskforce in their final report to replace the current royalty scheme with an ad valorem (according to value) scheme that is simple, competitive, and not a deterrent to investment.
The ad valorem royalty scheme will assist in positioning the Territory to supply the growing global demand for critical minerals.
The scheme incorporates four mineral treatment categories, applying four royalty rates that balance competitiveness with other jurisdictions while also ensuring that the Territory receives a fair return for its natural resources.
The four royalty rates that will apply are 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.
For more information, watch the video explainer.