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Exploration Licence Application Kit

Mineral Resources (Sustainable Development) Act 1990

Department of Primary Industries
Earth Resources Regulation
Victoria, Australia
February 2012

This kit is designed to assist in the completion of the Exploration Licence Application. The application requirements are outlined in Section 15 of the Mineral Resources (Sustainable Development) Act 1990 (MRSDA) and Schedule 2 of the Mineral Resources Development Regulations 2002 (MRDR).

How to use this kit:

You will need this kit and a copy of the latest version of the Exploration Licence Application form which sets out the requirements of Schedule 2 of the MRDR.
Answer each question in order, following the instructions in this booklet.
When you have finished, make sure you have answered every question correctly.
Note: Section 117 of the MRSDA provides that a person must not, by any false statement, misrepresentation or other dishonest means, obtain or attempt to obtain a licence. Penalties apply.
Sign the application, include all attachments, and forward to:

Earth Resources Business Centre
Department of Primary Industries
16th Floor, 1 Spring Street
MELBOURNE VIC 3000

Business hours are Monday to Friday, 9.00am to 4.30pm
Note that the application date, for the purposes of the MRSDA, is the date that the Business Centre receives the complete application.
It is important that you complete all questions on the Application Form and include all relevant attachments as otherwise the application cannot be accepted. You should also be aware that your application should be as comprehensive as possible, as your application may be competing against other applications lodged on the same day. If there are competing applications (overlapping the same land and lodged on the same day), then the order of priority is assigned after an assessment of the relative merits of the applications and the ability of the applicants to meet certain requirements. In the event that competing applications are received, each application will only be assessed on the details lodged with the application on the day it was lodged. In this instance, DPI may request clarification on details however there is no ability to add further details to the application.
If you have any further queries, call the Earth Resources Business Centre of DPI on (03) 9658 4456 or fax (03) 9658 4460, Email mbc.info@dpi.vic.gov.au

Note: Information provided on the application form may be disclosed to another government organisation for the purposes of administering or enforcing the MRSDA or a relevant Act and to the public for the purpose of land use advice.

DPI’s web site is www.dpi.vic.gov.au, see “Earth Resources/Minerals/Mineral Exploration and Mining requirements”

Exploration licence, retention licence, prospecting licence and mining licence application forms are also available on disk for frequent users.

Contact the Business Centre for further information.

The Application Process

Acceptance of application

Only valid applications will be accepted. Acceptance of an application takes place at the Earth Resources Business Centre, Melbourne

To be considered valid, an exploration licence application must contain all the information listed in Schedule 2 of the MRDR and any relevant requirements in section 15 of the MRSDA.An application cannot be made over land that:

is covered by an existing licence, or application (unless made on the same day); or
was covered by a previous licence or application less than 28 days ago; or
is exempted from licences or applications (includes National and State parks); or
is currently subject to a tender process.

Priority

After your exploration licence application is accepted by DPI, and if there are no competing applications, you will be informed by letter that your application has priority. If there are competing applications, the order of priority is assigned after an assessment of the relative merits of all competing applications and the ability of each applicant to meet certain requirements.

You will be informed by letter of the outcome.

Requirements to process application

Once your application is awarded priority, you are required to advertise the application to notify the public of your intentions and provide the opportunity for objections. Your application is assessed to ensure that:

you are a ﬁt and proper person to hold a licence;
that you have an appropriate program of work; and
that you are likely to be able to ﬁnance the proposed work and any rehabilitation.

DPI may also refer the application to other agencies for comment and advice of any land and heritage protection issues.

Fit and Proper Test

The matters to be considered by the Minister in determining whether a person is fit and proper, include whether the person has previously:

failed to undertake rehabilitation required under the MRSDA and the Minister has taken action to rehabilitate the land under section 83 of the MRSDA;
had a licence cancelled under the MRSDA;
been convicted of an offence against the MRSDA; or
been convicted of an offence involving fraud or dishonesty.

A person will not be considered fit and proper if they are currently an insolvent under administration.
In determining whether a person is fit and proper the Minister is not limited to consideration of the matters above.

Appeals to the Mining Warden where there is a dispute

The MRSDA provides that an applicant or a licensee may refer a dispute to the Mining Warden. The Mining Warden will hear the dispute and make a recommendation to the Minister or the Department Head. A dispute can arise under the MRSDA between:

a licensee or an applicant and the Department Head or an employee of DPI; or
a licensee or an applicant and the holder of a miner’s right; or
a licensee or an applicant and the owner or occupier of land; or
a licensee and another licensee or an applicant for a licence; or
an applicant and another applicant; or
a member of the public and the Department Head (or an employee of DPI) in relation to work under a licence that directly and substantially affects, or is likely to affect, the member of the public.

It is important to note that a dispute does not include an action taken by the Minister (or the Minister’s delegate). Consequently, any correspondence forwarded by the Minister or the Minister’s delegate in relation to an action or proposed action e.g. proposed refusal, cannot be referred to the Mining Warden.

Native Title

If the application area includes Crown land (other than Crown land where native title has been extinguished), the licence may be subject to native title and DPI cannot grant the licence until you have met the “future act” provisions of the Commonwealth Native Title Act 1993 (NTA) or have complied with the relevant land use activity agreements under the Traditional Owners Settlement Act 2010 (TOSA).

Note –The TOSA, once finalised, will provide for an out-of-court settlement of native title and delivery of land justice. The TOSA allows the Victorian Government to make agreements to recognise Traditional Owners and their rights in Crown land, in return for withdrawing native title claims and an agreement not to lodge future claims. Further information about the TOSA is available from the Department of Justice Native Title Unit (refer – www.justice.vic.gov.au).

You may choose from the following options (where applicable and if required):

Excise all Crown land except those areas where native title has been extinguished (such as roads and road reserves) and therefore remove the obligation under the NTA or the TOSA; or
Retain the Crown land and comply with the Right to Negotiate provisions of the NTA; or
Retain the Crown land and reach an Indigenous Land Use Agreement under the NTA; or
Retain the Crown land and comply with the relevant land use activity agreement under the TOSA.

You should consider the above options in relation to native title before you submit your application. There is a place on the application where you must indicate your choice so that processing of the application is not delayed.
Roads and road reserves are taken as having extinguished native title. However, there may be other areas of Crown land where native title has been extinguished by some previous exclusive possession act such as a commercial or residential lease.

If you choose option 1 you must assume that the only pieces of Crown land remaining within the licence area are roads and road reserves - unless you can demonstrate to DPI’s satisfaction that native title has been extinguished on other pieces of Crown land. If you choose options 2 or 3 and then demonstrate to DPI’s satisfaction that native title has been extinguished by some previous exclusive possession act over all the Crown land within the application, then the NTA would not apply.

After Grant

On grant, DPI will send you the registered licence document and information to enable you to start preparing for exploration. You can start low impact exploration immediately if you have the required public liability insurance and the appropriate consents (refer to notes on Questions 10 and 11 for the definition of low impact exploration).

Note: Consent to undertake work under a licence (whether for exploration or mining activities) must be in writing. However, for low impact exploration, the licensee must obtain either written consent or informed verbal consent of the owners and occupiers of the land affected (Refer Section 43(1)(ea) of the MRSDA, Section 44 of the MRSDA for Restricted Crown land consent and Informed Verbal Consent for Low Impact Exploration on Private Land guide).

Have an approved and registered work plan; and
Lodge a rehabilitation bond; and
Have written consent or registered compensation agreements with private landowners or occupiers for work on private land; and
Have consent from the Crown land Minister for work on Restricted Crown land; and
Have consent from Melbourne Water or an Authority under the Water Act 1989 for work on land owned or managed by them; and
Give 7 days notice of your intention to start work to the Chief Inspector and to the owners and occupiers of land on which you intend to work; and
Have confirmation of Public Liability Insurance.

Note - The program of work submitted with the licence application must be completed, in accordance with any schedule included in that program of work. The program of work, including scheduling, may only be varied with the agreement of the Minister. This does not apply if the variation only involves work which is additional to that described in the program of work.

During the term of the licence, the Minister may request updated details of the proposed program of work to be provided by a specified date. The licence holder must comply with any such request.

Expenditure, Reporting, Rent and Relinquishments

You must also comply with the conditions of your licence and report on your exploration activities annually. A condition of the licence is that you must spend a specified minimum amount on exploration activities for each year of your licence. Once a licence is granted, the annual Activity and Expenditure Return and the annual Technical Report must be submitted within 28 days after the specified reporting date (Regulations 26 & 27). Failure to submit the annual Activity and Expenditure Return by the due date may result in an infringement notice being issued.

Reporting requirements are outlined in the MRDR and licensees will be required to provide an annual activity and expenditure return and a technical report in relation to any exploration activities undertaken under the licence. Further details are outlined in the Exploration licence guidelines.

Rent is not currently prescribed for exploration licences.

On the second, fourth, seventh and tenth anniversaries of licence grant you are required to decrease the area of your exploration licence by 25%, 35%, 20% and 10%, respectively. DPI will ask you to identify the areas to be cancelled by written notice at least 60 days before the anniversaries. If you do not identify the areas for relinquishment, the Minister’s delegate may choose the areas.

Exploration licences are granted for a maximum of five years or a lesser period as determined by the Minister. An exploration licence may be renewed twice, for a period of five years or a lesser period as determined by the Minister, although a second renewal may only be granted where there are exceptional circumstances.

Exploration Licence process

Diagram showing the Exploration Licence Application Process

View the Exploration Licence Process, text version

Questions 1 & 2

Complete, for each applicant, surname, given names, title and date of birth details. Alternatively, if the applicant is an incorporated company, enter the Name of Incorporated Company and ABN (Australian Business Number).

Applications made by a company must be accompanied by a list of Directors (including their respective dates of birth details) and a Certificate of Registration of Company.

Note: At the time of lodgement the applicant(s) for a licence must be a legal entity. Applications made under trading names are not acceptable. As a company does not come into existence until incorporation, applications made by an unincorporated company will be invalid.

If the applicant is a registered company, it must give its registered business address. If the applicant is an individual, they must give a physical address (e.g. street number and name). A Post Office (PO) Box address is not acceptable but may be used for the correspondence address.

If there are more than two applicants, please indicate and include details of these applicants on a separate page attached to the application.
Applications made by agents or other persons on behalf of companies or individuals must be accompanied by a signed authorisation by the applicant(s) to act on their behalf with respect to the licence application. If this is not done, the application will be invalid and will not be accepted.
If the agent is acting for the applicant(s) on more than one licence application, a copy of the authorisation must accompany each new application, and the original authorisation must be lodged with DPI.
Indicate if the agent is to be the contact point for all enquiries regarding the application.
If the contact address for correspondence differs from the business address, complete the address for correspondence regarding this application. If the agent is to be the usual contact point for all enquiries regarding this application, enter the agent’s address here.

Note

Withdrawal of an application

You may withdraw an application in whole or part, by delivering a signed notice of withdrawal to the Earth Resources Business Centre. Any land that you withdraw from the application after you have been given priority is marked as “moratorium” in the spatial database and becomes available for application in 28 days.

Question 3

Quote the name(s) of the 1:100 000 Mapsheet(s) over which the application area extends. These maps can be obtained from Information Victoria (telephone 1300 366 356) and its regional outlets, map shops or the Earth Resources Business Centre.
Obtain a print-out of the application area of the relevant portion of the 1:100,000 Mapsheet from DPI. This will benefit you because it will show all areas which are unavailable for an exploration licence or that require particular consents (i.e. existing licences, certain Crown lands, etc.). Mark the area you are applying for on this map to assist in identifying the area of the application.
Note: A Geocentric Datum of Australia, 1994 (GDA) map grid showing the area covered by the application must be supplied with the application.
Calculate the area covered by the application, in graticular sections, and enter it in the application. You are not required to enter the graticule numbers. Note: There are shape restrictions for applications for exploration licences - the application may not contain isolated or fragmented parts (ie. it must be a single contiguous block). In addition, the application area should consist of complete graticules as much as possible unless a boundary abuts an unavailable area (such as an existing licence or a National Park).

Question 4

Under the Native Title Act 1993 (NTA) you are required to comply with the Right to Negotiate provisions of the NTA or reach an Indigenous Land Use Agreement. A booklet "Information regarding the processing of minerals tenements under the Native Title Act 1993" is available from DPI. The booklet is intended as a guide only and is not legal advice. Please rely on your own legal advice about native title prior to making decisions about your interests.

Option 1: Excise all Crown land except those areas where native title has been extinguished

If you have chosen option 1, then your application is assessed to ensure that the requirements of the relevant sections of the MRSDA have been met.

If Crown land has been excised from the application, leaving pockets of unallocated land within the application boundaries, DPI will exempt these pockets of land from other licences, so that you can conduct your exploration program in an orderly manner.

Options 2 & 3: Applications with Crown land (other than Crown land where native title has been extinguished)

If you have chosen option 2 or 3 you need to meet the requirements of both the MRSDA and the NTA. These processes are conducted in parallel and both must be completed before the licence can be granted.

Option 4: Applications with Crown land where there is a relevant land use agreement under the TOSA

If you have chosen option 4, you need to meet the requirements of both the MRSDA and the TOSA. These processes are conducted in parallel and both must be completed before the licence can be granted. Please note that TOSA Land Use Activity Agreements are anticipated to come into operation during 2013 - refer to Department of Justice for further details.

Note - “Crown land” as referred to in Question 4 does not include the Crown land that occurs at depth under private land. (Many freehold land titles were granted to 15.2 metres, ie 50 feet, and therefore are underlain at depth by Crown land.)

Question 5

Complete your proposed expenditure for the first and the second years of the proposed exploration licence and the total expenditure for years one to five. DPI has expenditure guidelines for exploration (see below). These are the minimum requirements and will form the basis of licence expenditure conditions.

The only circumstance where higher expenditure is set, is where the area is subject to a tender (section 27 of the MRSDA) or competition by a number of applicants (section 23 of the MRSDA). In these cases, your proposed expenditure (if higher than the DPI rate) will be used as the licence expenditure condition.

The minimum expenditure for each year is (a x b) + c, where:

a = the relevant rate per graticular section;
b = the number of graticular sections in your exploration licence; and
c = the base level of expenditure per year.

YEAR	FIXED (c)	*METALLIC MINERALS $ per GDA94 graticular section**	NON-METALLIC MINERALS $ per GDA94 graticular section**
1	$15,000	150	75
2	$15,000	200	120
3	$15,000	200	120
4	$15,000	200	120
5	$15,000	300	150

* eg Gold, Silver, Copper, Lead, Zinc, Antimony **eg Mineral Sands, Diatomite, Kaolin, Coal.

The expenditure condition is to be regarded as a minimum starting sum of money which is considered in conjunction with the costs of achieving the approved work program/work plan.

Refer to the Exploration licence guidelines for an outline of the items that can be claimed against expenditure requirements on the licence and the progressive expenditure over the licence term.The Exploration licence guidelines also list the items that cannot be claimed against expenditure requirements on the licence.

Question 6

In order to comply with the provisions of Section 15(6)(d) of the MRSDA relating to the applicant’s ability to finance the proposed work and rehabilitation of the land, the following information is required to support the application:

Companies (with an audited financial report):

Net equity (obtained from the balance sheet of the audited financial statements);
Professional expertise in lieu of expenditure (refer to note below);
Line of credit from a recognised financial institution; and/or
Prospectus (must be underwritten).

In completing the application, you are required to enter in the amounts against each field. In respect to audited reports, you only need to write down the Net Equity figure.

Individual or Companies (without an audited financial report):

Bank statement (no older than six months);
Professional expertise in lieu of expenditure (refer note below);
Line of credit from a recognised financial institution;
Prospectus (must be underwritten);
List of Plant & Equipment (owned by the applicant) - to be used for the purpose to which the application applies; and/or
Share certificates.

In completing the application, you are required to enter in the amounts against each field. In respect to providing a bank statement, the applicant must advise of known liabilities that will affect the balance of the bank statement within a twelve month period. DPI reserves the right to seek from the applicant a copy of an updated bank statement at any time during the life of the licence.

DPI measures your ‘Net Financial Position’ against the required expenditure for the application if granted for the first two years (i.e. the ‘Net Financial Position’ must exceed the required expenditure). Only the above information will be accepted as demonstrating the applicant’s ability in meeting section 15(6)(d) of the MRSDA.

All information relating to financial details must be no older than six months at the time the information is submitted. You must disclose whether any of the applicants is an undischarged bankrupt, is in receivership or is under administration.

Value of own labour

The applicants own labour can be counted as expenditure up to an amount of $25,000 per year. To claim an amount above $25,000 will require verification to substantiate the claim, eg. evidence of qualifications/experience/hours worked/rates of pay.

Question 7

Provide details of the field of expertise of person(s) undertaking the exploration program, including the applicant’s expertise and technical advisors to be engaged (i.e. geologist, engineer).

If these advisors are not employees of the applicant, you should indicate so in the place provided on the form. A statement, signed by the technical advisor agreeing to act for the applicant, must be provided with the application form.

If requested, the applicant should be able to provide evidence of their advisors’ qualifications and a copy of their Curriculum Vitae.

Question 8

Indicate your experience in exploration or mining activities.

Attach details or supplementary documents as necessary to provide information. This information might be important if DPI is required to determine a competing application.

Question 9

The matters to be considered by the Minister in determining whether a person is fit and proper are outlined in the overview section of the application kit.

In considering these matters the Minister must take account of the circumstances that lead to the action, the nature of the offence, the penalty imposed and when the action was taken or the offence committed.

The fit and proper requirements extend to associates of licence applicants. An associate is defined as a director, partner, trustee, executive officer, secretary or any other officer or person associated or connected with the ownership, administration or management of the applicant’s business.

In determining whether a person is fit and proper, the Minister is not limited to consideration of the matters above.

Questions 10 & 11

It is a requirement of Section 15(1BA) of the MRSDA that you must indicate the minerals you are seeking and type of targets you are proposing to explore. This information is for DPI exploration industry statistics and also influences the amount of annual expenditure required in the licence conditions. The answer does not affect your mineral rights under an exploration licence.

The application must include information about your work program. A work program is a detailed outline of the work proposed and should address the points listed on the application form. The program of work submitted with the licence application describing the work that will be undertaken must be completed. The program of work may only be varied with the agreement of the Minister.

Note: A work program that is for mining or for further defining a known resource is not acceptable for an exploration licence application. Further, a work program that is solely for research and development and does not include a field program is unlikely to be acceptable for an exploration licence application.

Indicate in the application whether the work program is proposed also to be the work plan. You do not need a work plan to start low impact exploration on an exploration licence. If this is your intention answer NO.

Low impact exploration is defined by section 4 of the MRSDA as exploring for minerals on land –

without using equipment (other than non-mechanical hand tools) to excavate on the land; and
without using explosives on the land; and
without removing or damaging any tree or shrub on the land; and
without disturbing any Aboriginal place or Aboriginal object on the land; and
without disturbing any place or object on the Victorian Heritage Register, or any archaeological site or relic included on the Heritage Inventory, under the Heritage Act 1995.

If you already know the location of proposed ground-disturbing activities, such as drilling or costeaning, your work program may have enough detail to be approved as the work plan. In this case you may answer YES.

The work plan must contain all the information specified in Schedule 12 of the MRDR. Further information on exploration work plans is outlined in the Exploration licence guidelines, the Standard Work Plan guidelines and the Area Workplan guidelines, all available on the DPI website.

SCHEDULE 12

Regulation 25

INFORMATION REQUIRED IN WORK PLAN FOR AN EXPLORATION LICENCE

A description of the proposed works, including details of the potential environmental impacts and the measures proposed for their control or mitigation.
If specific sites have been identified for drilling or other earthworks, a map showing the general location of those works, including any details regarding the cutting of tracks or roads.
A description of the proposed rehabilitation of any areas subject to surface disturbance including re-vegetation proposals and where relevant, proposals for the removal of plant and equipment.
A description of the proposed arrangements for consultation with landowners and Crown land manners and local councils.
Information about the proposed methods of monitoring, auditing, and reporting impacts on the environment.

Question 12

Indicate your preferred annual reporting date from the options on the form (31 March, 30 June, 30 September or 31 December). The reporting date will be specified on the licence document.

Once a licence is granted, the annual Activity and Expenditure Return and the annual Technical Report, must be submitted within 28 days after the specified reporting date (Regulations 26 & 27). Failure to submit the annual Activity and Expenditure Return by the due date may result in an infringement notice being issued.

Question 13

Nominate the period for which the licence is required. Base this on the size of the exploration licence, the exploration program rate and the time required to obtain all necessary consents.

The maximum term for an exploration licence is five years with up to two renewals possible, for a period of five years or a lesser period as determined by the Minister. The second renewal may only be granted where there are exceptional circumstances and where the Minister is satisfied that there is a likelihood of the licensee identifying minerals in the land covered by the licence during the period of the renewal.

Question 14

Calculate the appropriate fee. The application must be accompanied by the correct fee or it will not be accepted.

The application fee for an exploration licence is 90 fee units per 500 square kilometres.

Fees and charges are varied from time to time, so it is important to refer to the current version of Schedule 19 of the MRDR at the time of application.

A list of the current fees is outlined on the DPI Website at http://www.dpi.vic.gov.au/about-us/legislation/fees/earth-resources

Advice is available upon request from DPI offices including the Earth Resources Business Centre (see first page of this booklet for contact details). If paying by cheque, make cheques payable to “Department of Primary Industries”.

Attachments

When submitting the application, you must attach:

A map showing the area covered by the application; and
The application fee; and
The proposed work program/plan; and
Evidence of financial capacity.

Depending on your answers to the questions, you may also need to attach the following:

A list of directors of the Company, including date of birth details;
A copy of the Certificate of Registration of the Company;
Signed authorisation from the applicant for an agent to act on their behalf;
A statement by non-employee advisors of their agreement to act as advisors for this application; and/or
Other attachments such as audited reports to the Australian Stock Exchange (ASX) or other evidence of financial capacity to fund the proposed expenditure.

Describe these attachments in the blank space provided on the application. Indicate in the place provided on the application whether the application is accompanied by each attachment.

The application is invalid and will not be accepted if these items are not supplied where they are required.

Applicant’s Declaration

Before you sign the Declaration, ensure that:

You have answered every question;
All the information you have given is true and correct to the best of your knowledge;
You have attached all the required supporting documentation; and
You have attached payment for the appropriate fee.

All applications must be signed. If the application is in joint names, then all parties or their authorised representative(s) must sign the application form.

If one or more of the applicants is a Company, applications made by a Company must be signed by a Company Director or Company Secretary, or alternatively by a person who can provide written evidence that they are authorised to act on behalf of the Company with respect to that application.

Each signature should have the name and position of the person in the Company (if applicable) clearly printed. Priority is allocated according to the day the application is received by the Business Centre, Melbourne (see first page of this booklet).

Other Sources of Information

There are several sources of information which will be useful to licensees throughout the life of their licence. All are available through the Earth Resources Business Centre.

The MRSDA and the MRDR are essential reference documents for all licensees and are available on the DPI website: http://www.dpi.vic.gov.au/earth-resources/minerals/legislation

DPI has released a series of booklets providing useful information about different aspects of holding a licence under the MRSDA.

These include:

Exploration Licence Guidelines
Informed Verbal Consent for Low Impact Exploration on Private Land
Exploration and Rehabilitation of Mineral Exploration Sites
Abandonment of Mineral Drillholes
Rehabilitation and Environmental Aspects of Mining and Extractive work plans
Standard Work Plan guidelines
Area Work Plan guidelines
Code of Practice for Mineral Exploration
Why Licence Compliance Matters
Community Engagement Guidelines for Mining and Mineral Exploration
Guidance Notes for Aboriginal Heritage Act/Heritage Act
Mineral Exploration and Mining- Land Owners’ Questions Answered
Mineral Tenements and the Native Title Act 1993
Native Vegetation Management guide for Earth Resource Industries
Environmental Review Committee Guidelines
Exploration Licence Application Kit
Mining Licences Application Kit
Retention Licence Application Kit
Prospecting Licence Application Kit
Guidelines for preparing Environment Effects Statements for Mining Projects.

The Minerals Council of Australia (Victorian Division) has also produced several publications which provide information to explorers and miners, including the Guide to Private Landowners Regarding Exploration and Mining on Private Land.

If you have any comments regarding this Application Kit and the accompanying Application Form, please forward them to the:

Earth Resources Business Centre
Department of Primary Industries
Level 16, 1 Spring Street
MELBOURNE VIC 3000

(GPO Box 4440 Melbourne, Victoria 3001 Australia)

Phone (03) 9658 4456 or fax (03) 9658 4460
Email mbc.info@dpi.vic.gov.au

Department of Primary Industries

earth resources