KPMG Australia Partner Matthew Herring spoke at this year’s Noosa Mining Conference, shedding light on the current funding landscape in Australia and how Australian resource companies can strategise to secure grants.
“The purpose (of this presentation) is to provide examples of funding options so that you can start thinking about how you might take a strategic approach to government funding as part of your overall capital strategy,” Herring said in his introduction.
He started his presentation by explaining that governments are intervening in the mining sector and offering funding options because most of them are focused on domestic energy transition and decarbonisation.
“They’re also trying to get better capitalised on the phenomenal resource base that we have and move us up the value chain so that we can be internationally competitive,” he continued, adding that governments recognise the global race for investment Australia is in, and that the Australian government needs to compete with other countries on policy in order to attract capital into Australia.
In terms of funding options, Herring shared that there is a wide range of both state and federal government programs available. He did note that most of these do not cover standard mining and exploration projects, as they were designed to support projects that are looking at reducing emissions, testing and deploying innovative technologies, expanding production or improving supply chains.
While there are plenty of available options, the KPMG partner also noted these grants are generally competitive, meaning companies should plan ahead as to what funding they will apply for.
For projects that may not qualify for the usual state and federal government programs, Herring recommends looking at the research and development tax incentive. This option is widely accessed in the mining sector given its nature as an entitlement program.
The tax incentive covers up to 43.5 percent of one’s eligible spend and is refunded through the tax system. Herring underlined that this is often almost as good as what one would get with a grant.
Herring highlighted a few specific grants in his talk, with the first being the Queensland Critical Minerals and Battery Technology Fund, which is targeted to support businesses across the critical minerals supply chain.
Herring also touched on other opportunities for hydrogen and critical metals projects, as well as funding for research partnerships through Australia’s Economic Accelerator program.
The most important thing, according to Herring, is for companies to analyse their projects. “Understand what was available at one point in time to try and match with the projects that you might have on board,” he advised.
Towards the end of his talk, he gave a few tips on how companies can up their game:
“If you do these things well and you have good quality projects, you absolutely maximise your chance of success,” Herring ended.
Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.
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