Royalties information

The Department of Mines and Petroleum’s (DMP) responsibilities include:

  • administering the State’s mineral and petroleum royalties to ensure the community receives an appropriate return from the development of its mineral and petroleum resources
  • developing and providing royalty policy advice
  • implementing royalty policy through advice and management of appropriate legislation and royalty systems.

In 2014–15, DMP collected more than $5.3  billion in royalties from mineral and petroleum producers in Western Australia.

These royalty funds are paid to the State Government and used for law enforcement, education, health, roads and community development programs.

More detailed information about mineral and petroleum royalties is available through the links below.

Mineral production in Western Australia is diverse and includes some 50 different minerals in commercial production.  Under the Mining Act 1978 (WA), royalties are payable on all minerals.

Petroleum royalties collected for onshore projects are retained by the State Government; offshore royalties are shared between the State and Commonwealth in accordance with the relevant legislation.

Supporting the minerals and petroleum sector

There are no prescribed programs or schemes for financial assistance to Western Australia’s minerals and petroleum industry.

The resources sector, just like any other, is assisted through a wide range of government programs, regulatory instruments and policies at both the State and Commonwealth level. How the State Government may consider further support for the Western Australia resource sector in a range of economic and market conditions is outlined in the Guidance Note Supporting the Western Australian resources sector.

Supporting the minerals and petroleum sector guidance note - 197 Kb

Guidance note for supporting the minerals and petroleum sector

Iron ore financial assistance

In December 2014, the State Government made temporary assistance available to junior iron ore miners on a case-by-case basis.

The assistance offered was a 50% rebate on eligible hematite iron ore royalties for up to 12 months, subject to the iron ore price remaining below an average of $90 per tonne during the relevant quarter.

The rebate took effect from the December quarter 2014 royalty payment, with the first rebates available to eligible hematite miners since February 2015.

Royalties for Regions (RfR) is funding 25% of the cost of the payments, with this amount to be re-appropriated to RfR following repayment of the rebates.

At the conclusion of the assistance period, the rebates are fully repayable over a period of up to two years, with repayments to be made in accordance with a schedule negotiated between the producer and the Minister for Mines and Petroleum.

DMP released the Financial Assistance Guidelines for applicants on 29 December 2014.

Iron Ore Financial Assistance Guidelines - 96 Kb

Iron ore financial assistance guidelines for applicants

Mineral royalty review

In the 2012–13 State Budget, the Western Australian Government announced a Mineral Royalty Rate Analysis to review Western Australia’s royalty arrangements.  This review was conducted jointly by the Department of State Development and DMP, and the final report was released to the public on 25 March 2015.

The review examined the efficacy and appropriateness of the current royalty system and assessed alternative systems. The Terms of Reference required the review to consider the equity and efficiency of any proposed changes to royalty rates, the economic viability of commodity sectors, and royalty arrangements in other jurisdictions.

The Terms of Reference precluded changes to the ad valorem system and recommendations that would have a detrimental effect on Western Australia’s revenue base.

The government received 19 submissions from interested parties, organisations, and members of the community during the public submission period. The central themes of those submissions were:

  • the appropriateness of the 10% benchmark which underpins the current three-tier structure of ad valorem royalties
  • the efficiency and equity of the current royalty regime
  • cost structures
  • sovereign risk
  • profitability and economic conditions
  • international competitiveness and investment attraction.

As well as receiving written submissions, staff working on the review met with companies, industry groups, academia and community groups.  An Industry Reference Group comprising the Chamber of Minerals and Energy, the Association of Mining and Exploration Companies, and the two departments met regularly to discuss technical and policy issues.

Enquiries can be directed to mrra@dmp.wa.gov.au

Mineral Royalty Rate Analysis Report - 5492 Kb

The Mineral Royalty Rate Analysis will evaluate the structure of the State’s mineral royalty rates.

Minister’s media statement on the Mineral royalty review: "WA mineral royalty rate analysis released"

Supporting Documentation for the Mineral Royalty Rate Analysis can be found on the Department of State Development website.

Magnetite Financial Assistance

On 9 April 2013 the Premier announced a magnetite financial assistance program to provide a major boost for a developing Western Australian magnetite iron ore industry.

Royalty incentive for magnetite producers

Under the program, new magnetite projects could apply for up to 50% rebate of the royalty paid in the 12 month period from the project’s first shipment of magnetite. The policy applied for three years from the date of the announcement and approval was based on the government being satisfied that the project was located in Western Australia and met other criteria outlined in the following guideline. The program concluded on 8 April 2016.

Magnetite Financial Assistance program guidelines for applicants July 2013.

On 13 May 2016, a two year extension of the rebate program was announced as part of the 2016-17 State Budget  in light of difficult market conditions and the potential of the magnetite industry. It has been offered to the two mining operations that qualified under the original program.

Our State Budget 2016-17: Securing our economic future - Royalty relief backs Mid-West and Pilbara jobs.