The Mining Rehabilitation Fund (MRF) is a special purpose account under the Financial Management Act 2006. Most holders of mining tenements under the Mining Act 1978 will be required to pay a levy into the Fund, with the exception of tenements covered by State Agreements.
The levy will consist of annual Fund contributions, calculated as a percentage ? likely initially to be one per cent of each tenement?s estimated rehabilitation and closure cost/liability.
The rehabilitation and closure liability amount for a tenement will be assessed in accordance with a per hectare cost calculator tool (currently being developed).
This model was chosen following extensive consultation with industry, government and conservation/community stakeholders.
?I am confident the proposed fund will provide a more flexible and cost-effective system for industry, while meeting public expectations for higher standards of rehabilitation and mine closure,? Moore said.
He said that the current bond system needed an overhaul to ensure adequate funding was available for mine site rehabilitation, where operators failed to meet their environmental obligations.
The bonds would be also retained for some high risk operations.
The Bill to introduce the fund was read into state parliament on 15 August, 2012.
Moore said the fund formed part of the Department?s Reforming Environmental Regulation program and as part of this process, a Ministerial advisory panel was established, which former state government Environment Minister Cheryl Edwardes would chair, and was made up of representatives from industry, government agencies and non-government organisations.
The Association of Mining and Exploration Companies (AMEC) welcomed the introduction of the MRF.
?This new legislation is a result of extensive consultation with the industry and other stakeholders and is believed to be world-leading practice,? said AMEC CEO Simon Bennison.
The Western Australian Chamber of Minerals and Energy (CME) also welcomed the establishment of the MRF. Director Nicole Roocke said that the benefit for the industry was that the model freed up significant capital in the beginning of the project development, while the government benefited from having a fund that covered the full closure costs for mine rehabilitation.
Roocke said that some administrative matters still required discussion, particularly around calculation of liability and fund contribution.
It is proposed that the Mining Rehabilitation Fund will be implemented from 1 July, 2013.
Sources: West Australian Department of Mines and Petroleum, Creamer Media, Mining Weekly