Alaskan legislation aims to increase exploration

Legislation aimed at increasing the level of mineral exploration in Alaska has been passed.

Bill 197, known as the mining incentive bill, provides a 100% credit for all eligible exploration costs that can be used against future mining license taxes, corporate taxes and royalties.

The credits can be earned by accumulating exploration expenditures through to the time when all permits are received. When production begins, the credits can be deducted against 50% of the amount of taxes or royalties due the state in any year.

Up to US$20 million in credits per project is allowed. These can be transferable to the next owner but must be used within 15 years.

Exploration costs that could qualify under the program include geophysical and geochemical surveys, drilling, trenching, underground exploration and metallurgical testing.

The program applies to all lands, public or private, in the state.

Alaska Governor Anthony Knowles has referred to a reawakening of the mining industry in the area, citing the Fort Knox deposit of Amax Gold and the reopening of the Greens Creek mine, held jointly by Kennecott and Hecla Mining.