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Royalty and Financial Considerations

Every year the Department of Mines and Petroleum collects more than $4 billion from mineral and petroleum producers in Western Australia.

Petroleum royalties are administered and collected under State and Commonwealth legislation.  Royalties collected for onshore projects are retained by the State Government, while offshore royalties are shared between the State and Commonwealth in accordance with the relevant legislation.

Barrow Island onshore royalties are also shared between the Commonwealth and the State.

About $900 million comes either directly from petroleum companies operating under state petroleum royalty legislation or from grants from the Commonwealth that are linked to the value of petroleum production from the North West Shelf project.  Ordinarily, Western Australia would not be entitled to revenue from this project as it is located outside the State’s jurisdiction.  Accordingly, these payments are classified as a grant from the Commonwealth.

The funds being paid to the State Government and used for law enforcement, education, health, roads and community development programs (see below).

Wellhead Royalty

Understand how Wellhead Royalty is calculated.

Resource Rent Royalty

Find out more about Resource Rent Royalty.

Petroleum Resource Rent Tax

The Petroleum Resource Rent Tax (PRRT) is a secondary tax based on a project’s profitability, and applies to all petroleum products from a project in Commonwealth waters.

Summary of Royalty Provisions

This page offers a summary of  royalty provisions.