The NSW Government has released the new Critical Minerals and High-Tech Metals Strategy 2024-35.
Central to the strategy is a $250 million royalty deferral for new critical minerals projects.
This is intended to ease cashflow stress for new projects during the first five years of operation, provide time for projects to fully establish operations and scale-up production and provide a greater incentive for projects to move forward to production.
The royalty deferral scheme will:
- be an opt-in program and would require companies to apply to receive the royalty deferral
- apply to projects that commence production between 1 July 2025 and 30 June 2030, receiving a royalty deferral for five years from the date of first production. For example, a royalty normally payable in Q1 2027 would be due in Q1 2032
- will apply exclusively to minerals on the Commonwealth Government’s Critical Minerals List and will not apply to other minerals such as copper or gold
- will only apply to projects that are predominantly extracting a critical mineral on the Critical Minerals List, and projects that have a market capitalisation of less than $5 billion.
Companies would still be required to lodge their quarterly returns, but payment itself will be deferred. Repayment of deferred royalties will be subject to indexation consistent with the rate of Government borrowing at the time of the deferred payment.
Implementation of the royalty deferral scheme will take place over the coming months. This will include legislative and regulatory changes.
Guidelines outlining the eligibility and length of the deferral period will be available soon. The guidelines will specify clear criteria and the process for applying and participating in the scheme, including reviews of compliance history, fit and proper person assessments and financial viability, consistent with checks already applied for titles assessment
The NSW Government will engage with industry as we develop these guidelines.
More information will be published on our website once it becomes available.
Find out more about critical minerals projects happening in NSW.
