Background
Areas relinquished from exploration licences are advertised as Exploration Release Areas (ERAs), with a moratorium period of at least two months to allow potential applicants to view relevant data and reports before making an application for the area.
Explorers are notified of new or pending ERAs via Mineral Resources Tasmania's TasXplorer fax-sheet system. These fax sheets include location maps and summary geological notes, as well as contacts for further information. The ERA notifications are also posted on the internet.
The ERA system is designed to encourage exploration programs which stand the best chance of discovering the new mineral deposits needed to sustain the future Tasmanian mining industry.
Operation of the ERA system
The basic rules of the system are:
- no application for the relinquished area is accepted during the moratorium period.
- applications are received from an advertised opening date. Applications received during the first five working days are treated as simultaneous and have priority over later applications. Thereafter applications received on the same day are treated as simultaneous and have priority over later applications.
The main objective in awarding an exploration licence is to achieve the fullest assessment of the potential of a given area possible within the constraints of commercial prudence. The best assessment is likely to be achieved by the applicant willing to undertake the greatest exploration effort on the whole ERA. The successful applicant is required to meet the full extent of the financial commitment made in the bid application.
Applications are evaluated on the basis of costed work programs for the first two years of tenure as submitted with the applications. Contingent sums are not included in an assessment of the costings. Where an applicant submits a range of costings, only the lowest figure is considered in a comparison with other applications
Primary Selection Criteria
These are:
- the nature of the work program submitted.
- the extent to which the minimum program includes drilling, data evaluation and geological, geochemical and geophysical surveying, reflects the available technical information on the exploration prospects of the area, and seeks to identify new exploration prospects.
- the applicant's experience, expertise and innovation.
- the adequacy of financial resources and scientific and technical expertise available to the applicant.
- the applicant's past exploration performance.
- the ability and demonstrated record of the applicant to carry out exploration to the environmental standards set out in the Mineral Exploration Code of Practice.
The ERA selection process is therefore not merely a simple comparison of expenditure proposals. Attention is given to efficiency of operation. For example, drilling programs are compared in terms of proposed metres of a given style of drilling, rather than drilling budgets.
Other things being equal, exploration programs that emphasise direct methods of mineral discovery, such as drilling, are favoured.
Selection Panel
Competing ERA applications are evaluated by a selection panel of three to five people, consisting of the Director of Mines, the relevant managing geologist for the commodities involved, a senior geologist and possibly other geoscientists with relevant expertise, such as geophysics or geochemistry.
Applications are circulated to the selection panel members before the selection meeting without attached comment. At the meeting a comparison of the applications, drawn up by a nominated selection panel member, is placed on the table. This is a factual summary of the various components of the competing bids (e.g. targets, geological, geophysical and geochemical programs, intended drilling, budgets).
Selection of the successful applicant is by consensus.
Should the selection panel fail to reach agreement, there are a number of resolution mechanisms:
- leading applicants may be invited to present verbal submissions at Mineral Resources Tasmania to support their applications. This has happened on one occasion; or
- where the relative merit of the applications still cannot be determined, Section 12(1)(c) of the Mineral Resources Development Act 1995 provides that the matter can be settled by ballot. This has yet to happen.
In some cases, an ERA may be divided between different applicants where competing programs of merit cover different areas or commodities and, in the opinion of the selection panel, such a division of the area would result in better and more thorough exploration of the area.
Following the selection panel's decision, a member telephones all applicants and informs them of the decision and the broad reasons for it. This is done in such a way as to protect the confidentiality of any applicant's proprietary information or exploration methods. This consultation is followed up by formal written notification.
The successful application(s) is then processed as for a normal Exploration Licence.
