How to Calculate Expenditure Commitment (Covent) (NT)

Bench Mark Covenant – simular as WA covenant calculated by area & age – guideline 6

Expenditure Form 17

Benchmark Minimum Expenditure for Exploration Licences:

Year One	$10,000	plus	$ 150 per block
Year Two	$10,000	plus	$ 250 per block
Year Three	$10,000	plus	$ 500 per block
Year Four	$10,000	plus	$ 750 per block
Year Five	$10,000	plus	$1000 per block
Year Six	$10,000	plus	$1250 per block

The minimum benchmark expenditure per block will escalate at the rate of $250 per block for each year the area is retained beyond the initial six-year grant period

The following formula will then be applied:

Total Consecutive Two Year Proposed Expenditure ÷ Number of blocks held in second year of non-compliance
= Amount to be spent per block
$145,000 ÷125 = $1,160
Total Consecutive Two Year Proposed Expenditure – Actual Consecutive Two Year Expenditure
= Underspend
$145,000 ‐ $72,100 = $72,900
Total Consecutive Two Year Proposed Expenditure – Actual Consecutive Two Year Expenditure
= Underspend
$145,000 ‐ $72,100 = $72,900
Total Underspend x 50% ÷ Amount to be spent per block
= Number of Blocks subject to cancellation
$72,900 x 50% = $36,450 ÷ $1,160 = 31.42 Blocks

Please note that the above will not come into effect until the 2nd anniversary/report the EL has not met expenditure after November 2011 and only applies to the initial grant period years 1 - 6 only.

Expenditure Shortfall 2 Consecutive Years
Mineral Titles Regulation 82- the Minister taking action under section 105(3) of the Mineral Titles Act. If the title holder does not meet the expenditure condition for two consecutive years, the Minister may take action under section 105(3) of the Act the cancel part of the EL title area.
The number of blocks subject to a cancellation for non-compliance is calculated on:

the proposed expenditure nominated for each of the two consecutive years;
the amount to be spent on each block held in the second consecutive year (proposed expenditure divided by the number of blocks held);
actual expenditure for the two consecutive years; and
difference between the proposed expenditure and the actual expenditure (underspend).