‘No silver bullet’: Mines Minister David Michael pours cold water on hopes of imminent lithium royalty relief

David Michael has seemingly shut the door on near-term potential for WA’s struggling lithium miners to receive tax breaks. Tony Ottaviano — the boss of Australia’s newest lithium miner Liontown Resources — on Tuesday urged the State Government to consider fast-tracking royalty relief for lithium producers as the commodity’s price languishes in the doldrums. The Government earlier this year introduced a 50 per cent royalty rebate on nickel sales, also amid a backdrop of sinking prices, but Mr Ottaviano suggested that help came too late. The Mines and Petroleum Minister was asked if imminent royalty relief for WA’s cohort of lithium producers was on the cards. “We understand that there’s some price pressures, both from the cost end and also from the price end, for lithium probably more cyclical, obviously nickel some cyclical but a lot of structural,” Mr Michael said. “Tony is obviously incredibly impressive in what he’s been able to do in his (Liontown) milestones recently and in his career. So, I value his comments around what he thinks government should do. “My commitment is to continue to work with industry and listen to them.” Mr Michael was then pressed by The West Australian if his response indicated that, for the time being at least, impending lithium royalty relief was off the table. “For the time being, we’ll discuss options with both industry and, importantly, the peak bodies that I regularly talk to,” he said. “We know that royal relief is not a silver bullet for worldwide (battery metal) demand not hitting where we thought it would be.” Despite Mr Ottaviano’s comments, Association of Mining and Exploration Companies chief executive Warren Pearce said “industry is not asking for assistance right now”. “But if global market conditions continue to deteriorate, there might be a very real need for support,” he said. “We saw the successful rollout of (lithium) royalty deferrals in 2020. It was a temporary and effective measure that supported companies through a difficult period, and positioned WA to take advantage when stronger prices returned.” The Minister was also asked about Mineral Resources’ ongoing cull of its white-collar workforce, amid a broader flurry of job cuts to hit WA’s mining industry, and if the latest job losses were another sign of an industry downturn. “Any job cut, obviously, is concerning and my thoughts are always with those employees and the families who have to go through that upheaval in their lives,” he said. “I know the State Government is always there to support it throughout jobs and skill centres to help people find new jobs, retrain if it’s needed. “We continue to talk to those industries and those projects and companies who have had made those announcements this year . . . we continue to monitor the situation.” It came to light on Tuesday that MinRes is purportedly sacking about 100 white-collar workers, centred predominately on employees based in the company’s plush Osborne Park office. The MinRes job cuts add to the growing tally of thousands made in WA mining over the past 12 months, as softer commodity prices force companies to make tough decisions about their balance sheets.