South-West Pacific Mineral Royality Regimes

Almost all the countries of the south-west Pacific and the Australian states have recently completed or have commissioned mineral royalty reviews. The prime reasons for this widespread and consistent action is the desire of the governments of these entities to redress perceived effi- ciency and equity imbalances and to ensure that the revenue raising motive does not override the necessity to maintain mineral exploration and development incentives. Governments are tending to adopt royalty systems comprising a com- bination of base royalty and a profit component. Resource rent royalty and royalty holidays have been introduced and anomalies, such as royalty free gold production, still exist but appear to have uncertain futures. Tasmania ranks as the Australian state with the lowest aggregate royalty levy/production value ratio whilst Papua New Guinea has the highest royalty objective achievement level in the south-west Pacific region.