Royalties and Fees

Onshore South Australia, the Crown retains ownership of geothermal, petroleum and other regulated resources contained in the ground. Ownership of a regulated substance transfers to a licensee upon recovery of the regulated substance on which a royalty is levied. This royalty is in addition to the Commonwealth, state and local government taxation regimes to which all companies and individuals are subject.

The following royalty provisions apply to the exploration and production of geothermal energy:

  • Royalty on geothermal energy is 2.5% of the wellhead value.
  • The value at the wellhead of geothermal energy is calculated by subtracting from the price (exclusive of any GST component) that could reasonably be realised on sale of the energy to a genuine purchaser at arms length from the producer, all reasonable expenses (exclusive of any GST component) reasonably incurred by the producer in getting the energy to the point of delivery to the purchaser.
  • The value at the wellhead of geothermal energy is to be assessed by the minister.
  • The minister may, on application by the producer, or on the minister’s own initiative, review and revise an earlier assessment of the value at the wellhead of the geothermal energy.