COMMODITY CAPERS: There was good news for Western Australian mining types in the Fraser Institute Annual Survey of Mining Companies for 2018.
This year the institute managed to evaluate 83 jurisdictions, compared to the 91 jurisdictions evaluated in 2017, 104 in 2016, 109 in 2015, and 122 in 2014.
Western Australia moved up from fifth in 2017 to take out second place on the survey’s top jurisdiction in the world for investment based on the Investment Attractiveness Index.
The Fraser Institute overall Investment Attractiveness Index is constructed by combining the Best Practices Mineral Potential index, which rates regions based on their geologic attractiveness, and the Policy Perception Index, a composite index that measures the effects of government policy on attitudes toward exploration investment.
The only jurisdiction to do better than WA was Nevada, which moved up from third place in 2017.
WA was the only Australian jurisdiction to rate a spot in the survey’s Investment Attractiveness Index top 10.
Narrowing the field to encapsulate Australia and Oceania provided Australian jurisdictions with more joy.
On this list WA took top spot with Queensland second.
Fiji prevented an Aussie trifecta by taking third spot pushing Northern Territory into fourth and South Australia to fifth.
New South Wales, Victoria, and Tasmania maintained some respect by finishing above The Philippines.
The Fraser Institute Policy Perception Index (PPI), which the institute describes as “A report card to governments on the attractiveness of their mining policies” provided some encouragement to local jurisdictions.
Victoria and WA both improved their PPI scores by more than 10 points this year with Victoria taking its ranking from 52nd (of 91) in 2017 to 43rd (of 83) in 2018.
Respondents to this year’s survey expressed less concern over Victoria’s political stability (-17 points), uncertainty regarding the administration, interpretation, or enforcement of existing regulations (-13 points), and the taxation regime (-11 points).
Western Australia enjoyed a big jump in its score and rank, moving up to 5th (of 83) from 17th (of 91) last year, as fewer respondents rated the state’s taxation regime (-23 points), political stability (-15 points), and uncertainty concerning environmental regulations (-12 points) as deterrents to investment.
New South Wales enjoyed an increase of eight points over last year, improving its ranking to 53rd (out of 91) in 2017 to 47th (out of 83) in 2018.
This year miners were less worried about trade barriers (-10 points), although they did have higher concern over the legal system (+14 points).
Despite an increase in the rankings, New South Wales is Australia’s lowest ranked jurisdiction when considering policy factors alone.
Comments from respondents regarding some of the local jurisdictions, included:
New South Wales
Frequent changes to policy, poor consultation with industry, and frequent changes to regulatory staff are concerning for investors.
An exploration company president.
Getting access to Crown Lands is much more difficult than accessing private lands, which poses challenges for investors.
An exploration company senior management.
Poor and flawed legislation relating to the Mining Act (1971) is a major concern for investors. Although the legislation has been acknowledged as flawed by the government, no attempt is being made to address its deficiencies in the latest amendments.
An exploration company president.
Victoria’s high electricity prices are a deterrent for investors.
An exploration company chairman.
Victoria’s moratorium on onshore gas exploration is a deterrent for investors.
A producer company with less than US$50M company president.
Western Australia’s environmental policies and permitting requirements are streamlined and easy to understand. In addition, well-documented environmental, economic, and social requirements create a positive experience for investors.
An exploration company other senior management.
Western Australia’s wonderful new data sets are stimulating exploration in the region.
An exploration company manager.