As one of the largest mines in the Northern Territory, MRM plays a significant role in the region’s economic development. Our operations support local industry and business, provide jobs and training opportunities, and contribute to government through taxes and royalties.
MRM contributes to the Australian and Northern Territory economies through:
- direct employment for staff and contractors, generating annual wages bills
- taxes and charges including payroll and group tax paid to the Northern Territory Government and Australian Government
- long-term commercial contracts for the supply of electricity and utilities by the Northern Territory Power and Water Authority
- a growing percentage of commercial suppliers sourced within the Northern Territory and the local Borroloola community including contractors, office rental, labour hire and goods and services
- royalties payable to the Northern Territory Government.
Economic planning
We recognise that effective and sustainable community development is best generated through:
- adopting a strategic approach linking development activities to the long-term objectives of the mine as well as regional planning for the Borroloola community
- consultation and participation to involve the community in all milestones within the mine’s future
- working in partnership with private, governmental, non-government organisations and community organisations to share interests, resources and effort
- strengthening the capacity of the community to operate independently long-term.
From an economic perspective, the critical links between the needs of the region in which we operate and our business objectives are the provision and retention of skilled, reliable, local employees, and the availability of competitive goods and services within the local region.
To achieve these objectives, MRM acts both directly and via the MRM Community Benefits Trust. The Trust was established in partnership with the Northern Territory Government and the local community to support the socio-economic development of the region. Through this Trust, MRM will contribute in the order of $32 million to the local community over the life of the mine.
In a direct way, we act through our operations in the areas of indigenous employment and training, local purchasing and workforce participation in the community. Opportunities within each of these areas are identified through:
- internal and contractor human resource planning
- purchasing needs analysis for goods and services
- management planning for operating cost reduction
- job placement planning for the local indigenous trainees
- liaison with Northern Territory Government representatives.
Other areas of interest
McArthur River Mining Community Benefits Trust
Supplier information
Each year, we invest many millions of dollars with Australian, Northern Territory and local Borroloola-based suppliers.
We want to do business with companies that share our values and principles to work ethically, responsibly, openly and together with others.
MRM uses a services procurement process which typically involves business planning, tendering, contract management and reviews. All contracting companies performing any work onsite need to be appropriately accredited in line with relevant legislation and Xstrata’s Business Principles and Sustainable Development Policy. Suppliers of goods and services similarly need to meet accreditation requirements in relation to product stewardship and Sustainable Development policies.
The Xstrata Ethics Line is an independently run, confidential facility providing all stakeholders with a means for reporting breaches of Xstrata’s Business Principles, policies or prevailing legislation. To access this line, please visit www.xstrataethics.com or freecall: 1800 987 310.
Our policy is to give Northern Territory businesses the primary opportunity to supply the mine’s goods and services where there is capability competitively available.
We would like to acknowledge some of our major suppliers:
Other areas of interest
Xstrata Ethics Line
Xstrata Zinc Australia Sustainability Report 2010 (2.2Mb)
Media releases
MRM commits 100% of project investment in Australia (0.2Mb)
Royalties
Royalty arrangements are dictated by the McArthur River Project Agreement Ratification Act as well as the Mineral Royalty Act. The arrangements are calculated based on a formula that takes into consideration revenue, operating costs, capital deductions, exploration expenses and other deductions approved by the Northern Territory Treasurer.
Payment of royalties is largely dependent on global commodity prices and the recovery of costs of both the mine’s establishment and the open pit development. Once these costs are recovered then royalty payments are due to the Northern Territory Government. The amount paid is calculated as 18% of profit.
Northern Territory Treasury audits MRM’s financial results annually to determine if royalties are due. Up to and including 2006, MRM did not meet the threshold requirement for royalties to be paid.
MRM made its first royalty payment to the Northern Territory Government of $13.06 million paid in July 2007.
Because the mine is located within an exclusive pastoral lease, it influences how royalties are paid. In our case, all of the royalties are to be paid direct to the Northern Territory Government.
Media releases
MRM pays first royalties to Northern Territory Government (0.1Mb)