Budget Resources

Dr Martin Smith

The Future Made in Australia package is focussed on promoting mineral processing and refining and manufacturing clean energy technologies (Budget strategy and outlook: budget paper no. 1: 2024–25, pp. 18–21). The Resourcing Australia’s Prosperity initiative further supports the government’s push to increase resource discovery and development and industrial capacity for critical minerals. These moves stem from the realisation that the global energy transition requires a fundamental shift away from fossil fuel energy sources and an increased reliance on a range of critical minerals and their products. As noted in the March 2024 Resources and Energy Quarterly, the global transition ‘will see increased demand for commodities used in low emission technologies (for example, iron ore, aluminium, copper, nickel and lithium), it will reduce demand for other commodities (such as some fossil fuels)’ (p. 4).

Critical minerals are materials essential for modern technologies, economies, or national security for which supply chains are exposed to risk or disruption. Strategic minerals are important to the transition to net zero and other technological applications, for which Australia has geological potential to host significant resources. The key difference between critical and strategic minerals is that strategic minerals are not exposed to significant supply chain risks. Australia’s Critical Minerals List identifies 31 critical minerals, while the Strategic Minerals List identifies 5 strategic minerals.

The Critical Minerals Strategy 2023–2030 sets out the government’s considerations in defining Australia’s critical minerals, and examines how government can support their development and security. Australia produced 52% of the lithium, 10% of the manganese, 25% of the zircon, and significant proportions of the cobalt, rare earths, and other critical minerals in the world in 2022. In addition to mineral production, Australia hosts globally significant resources of critical and other minerals necessary for the global energy transition, as well as for traditional materials such as iron and nickel for steel. Australia has a long history of mining and exporting the raw materials needed globally. As noted in the Critical Minerals Strategy, ‘Australia is well placed to support diverse, resilient and sustainable supply chains. But these will not come about unless governments, communities and industry work together’ (p. 12). Fostering investment in developing Australia’s mineral resources, and incentivising commodities critical to the energy transition are a means of shoring up supply, both for the domestic market, and for key trade partners.

The government has taken the view that ‘Growing the [critical minerals] sector and moving into downstream processing, where we can do so competitively, will capture more value, economic benefits and jobs in Australia while boosting our sovereign capability’ (p 12). Despite Australia’s well-documented success in generating revenue from exporting raw materials, moving into downstream processing and manufacturing, and how that might affect the broader economy, is less certain.

Mineral processing and industrial manufacturing are often associated with significant environmental impacts and greenhouse gas emissions. Increasing industrial and manufacturing activity is also likely to affect Australia’s energy supply and demand profile, with associated greenhouse gas emissions and environmental impacts (for example, IEA 2023 report, p. 11). Careful planning, management, and monitoring will be necessary to ensure that such activities do not increase Australia’s emissions, or worsen environmental impacts, and to inform policy considerations for the Future Made in Australia package.

Geoscience Australia’s role

Geoscience Australia (GA) provides precompetitive geoscience; that is data, information, tools and expertise to help industry identify high potential areas for mineral and energy resources. It is a non-corporate Commonwealth entity. GA’s focus is shifting from more traditional commodities, such as offshore oil and gas, gold, copper and iron, to critical and strategic minerals in line with the Critical Minerals Strategy 2023–2030. Discovering and developing these resources underpins value-adding in renewable hydrogen, green metals, critical minerals, and clean energy manufacturing (A future made in Australia, budget 2024–25 factsheet, pp. 2–3). The government stated, ‘We’ll deploy Australia’s top geoscientists to fully map Australian resources that will power our future, help us make more here at home, and create good secure jobs now and for the next generation’ (p. 1).

The Budget positions GA at the centre of Australia’s transition to net zero and provides significant new funding. This includes:

• $566.1 million over 10 years, and then an average of $111.8 million per year in ongoing funding over 35 years to 2058–59 to GA for the Resourcing Australia’s Prosperity (RAP) program, as part of the ‘Future made in Australia – investing in innovation, science and digital capabilities’ measure (Budget measures: budget paper no. 2: 2024–25, p. 66). This ongoing funding is committed to beyond 2050, the year legislated as Australia’s target for reaching net zero greenhouse gas emissions.
• $207.4 million over 5 years, and $38.2 million ongoing for the Landsat Next Satellite Earth Observation program (Portfolio budget statements 2024–25: budget related paper no. 1.11: Industry, Science and Resources portfolio, p. 131). This program is part of the ‘Future made in Australia – investing in innovation, science and digital capabilities’ measure (Budget paper no. 2, p. 66). The program will continue GA’s access to earth observation data and imaging from NASA’s Landsat satellites in the next generation of the program (Landsat Next).[1]
• $16.6 million funding over 3 years for GA under the ‘Future made in Australia – making Australia a renewable energy superpower’ measure to support the design and development of the critical minerals production tax incentive and to establish an independent mineral testing function (PBS 2024–25: Industry, Science and Resources, p. 131). How government provides industry support, including production incentives, is contested. Broader considerations are discussed in the Budget review 2024–25 article ‘New industrial policy: a Future Made in Australia’.

The Budget’s provision of long-term funding for GA provides a clear statement on the entity’s importance and future following a history of specific time‑limited and supplementary funding. These measures are accompanied by a 15.8% increase in GA’s average staffing level (ASL) from 652 to 755 in 2024–25 (Agency resourcing: budget paper no. 4: 2024–25, p. 177). How the increased funding will affect longer term staffing at GA remains to be seen.

Resourcing Australia’s prosperity (RAP)

The RAP program was announced on 8 May 2024 by the Prime Minister and the Minister for Resources, with this ‘long-term investment, led by Geoscience Australia, underscor[ing] the government’s plan to put the resources industry at the heart of its Future Made in Australia policy.’ The RAP program will collect data and carry out geoscience research to ‘map Australia’s national groundwater systems and resource endowments to increase industry investment and identify potential discoveries of all current critical minerals and strategic materials’ (p. 66) and commit GA to the ‘full mapping of Australia over the next generation’. The RAP program reshapes and extends GA’s Exploring for the Future (EFTF) program which was otherwise ending. EFTF was an 8‑year, $225 million program focused on precompetitive geoscience data acquisition and information discovery provided for in 2 tranches, in the 2016–17 (p. 129) and 2020–21 (p. 258) budgets. While the EFTF program focussed on specific regions of the country or particular resource types, the RAP aims to cover the whole country for a broader range of resources. The RAP also dovetails with the Critical Minerals Strategy 2023–2030 and the carbon capture and storage (CCS) and hydrogen aspects of the Future Gas Strategy.

Under the RAP program, GA will work with regional communities, landholders and First Nations to help them understand and manage their land and water resources (p. 2). This information will also help inform them about the potential for mining projects (p. 2).

RAP will include mapping mineral occurrences and prospectivity to identify potential new deposits of critical minerals and strategic materials needed for clean energy and its technology, as well as traditional minerals like iron ore and gold (p. 1). Another key activity is to identify potential storage sites for hydrogen (p. 1). The program will lead to ‘a deeper understanding of the resource potential of our regions by mapping out all of Australia’s groundwater systems, supporting climate resilience, our agricultural sector, and water security for communities and the environment’ (p. 2). GA will map offshore areas to better understand the potential for offshore ‘carbon capture and storage, as well as possible sites for clean hydrogen projects’ (p. 2).

Reaction to the Budget

The resources sector has welcomed these announcements (pp. 2–3). In pre-budget submissions, the Minerals Council of Australia, Association of Mining Exploration Companies, and Australian Energy Producers all called for increased funding for GA to deliver precompetitive geoscience and improved earth and environmental data. Science and Technology Australia supports the RAP program, noting, ‘These are positive first steps towards diversifying our economy’ (p. 2). The Australian Academy of Science noted RAP as one of ‘several key investments in recognition of the value that science brings to the nation’ (p. 2).

Some concerns have been reported that the RAP program is support for the gas industry and gasfield development that is contrary to the government’s climate and emissions goals. The Future Gas Strategy ‘makes it clear that gas will remain an important source of energy through to 2050 and beyond, and its uses will change as we improve industrial energy efficiency, firm renewables, and reduce emissions’ (p. 2). Under the strategy, Minister King argues that continued gas use is a necessary part of the transition to net zero and that technologies including CCS is required for ongoing gas use and new gasfield development if emissions are to be reduced in line with the Safeguard Mechanism.

More broadly, the International Energy Agency (IEA) has stated ‘There is no need for investment in new fossil fuel supply‘ (p. 21), including new gasfield developments, in their pathways to transition to net zero by 2050, noting that ‘each country will need to design its own strategy, taking into account its specific circumstances’ (p. 4). The IEA also recognises that CCS is part of a vital suite of technologies required to meet net zero by 2050 (p. 79), and that government investment is necessary to accelerate innovation in CCS (p. 16).

Geoscience Australia – value of public good data and information

GA makes all data and information available to the public, as well as to the resources industry. It is a custodian and steward of Australia’s geoscience data, as discussed in GA’s submission to the Productivity Commission’s inquiry into data availability and use during 2016. GA’s activities are broader than mineral resource activities, providing data, information and advice on natural hazards, positioning, community safety, environmental science and monitoring, and water.

Deloitte Access Economics stated, ‘precompetitive geoscience data and analysis is also used for soil mapping, natural hazard assessment, groundwater identification, forensics, defence, ecology, research, and informing land use decisions’ (p. 11).

The data and information that GA collects, manages, and makes available allows government, industry, and the public to make informed decisions about resource exploration, water resource management, environmental management, marine jurisdiction management, infrastructure planning, agricultural planning and land management, the insurance industry, and emergency management. GA also plays an important role in geoscience education, hosting ‘7,986 school students across 213 school visits and 3,197 students across 12 virtual engagements’ in 2022–23.[2]

In fulfilling these broad functions, GA collaborates with federal and state government agencies, including the Australian Antarctic Division, Bureau of Meteorology, CSIRO, the Department of Climate Change, Energy, the Environment and Water, Murray-Darling Basin Authority, National Water Grid Authority,  among others.

Deloitte Access Economics found that ‘precompetitive geoscience data and analysis supported $76 billion of value added in the Australian economy’ (p. 3). They noted:

… due to the long timelines associated with resource discovery and development, the benefits generated by precompetitive geoscience data and analysis are often realised years after its public release. As such, it is difficult – near impossible – to attribute a single year of precompetitive geoscience data and analysis activity to a resultant year of economic activity. [p. 4].

Deloitte also found that the nascent hydrogen industry has benefitted from GA’s precompetitive work through savings in due diligence and stimulated economic activity from exploration (p. 7).

The benefit of public geoscience is also not limited to the resources sector. Alluvium found that it was likely that groundwater projects provided benefits ‘significant enough to generate a positive return on investment’ (pp. 17 and 28). Other examples of the value of public geoscience are provided by GA’s ‘Value to the nation’ webpage.

[1].       Department of Industry, Science and Resources (DISR), Portfolio Budget Statements 2024–25: Budget Related Paper No. 1.11: Industry, Science and Resources Portfolio, (PBS 2024–25: Industry, Science and Resources), (DISR, 2024), 131.

[2].       Geoscience Australia, Geoscience Australia Annual Report 2022–23, (Canberra: Geoscience Australia, 29 September 2023), 49.

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