Working out how to start a mining company in Australia comes down to three things you sort out before you dig: a business structure (most often a Pty Ltd company), the right mining title from your state regulator, and the land access, safety and environmental approvals that come with it. For a small operator, that title is a prospecting licence or mining claim far more often than a full mining lease.
Here’s the honest part. Most people who want to start a mining company already have the hard bit sorted: a patch of ground they believe in, a trade, or a contract offer from a mine site. What stops them is the paperwork. Every state runs its own system, and none of the government pages are written for someone starting small. The list is finite, though. Work through it in order and it gets a lot less scary.
- Your state decides your licence. Mining titles come from state and territory regulators, so a WA prospecting licence and a Victorian one work very differently.
- A miner’s right won’t carry a business. It’s a recreational permit for individuals using hand tools. Mining to sell needs a proper title.
- Most new mining companies start as service businesses. Contract engineering, maintenance and construction on someone else’s mine site is the most common entry point we see.
- Mines have their own safety laws. Queensland, NSW and WA all apply mine-specific safety rules on top of general WHS duties.
- Small gold producers may pay less royalty than they expect. WA and Victoria both exempt the first 2,500 ounces of gold each year.
Get on demand legal advice for one low monthly fee.
What kind of mining company are you actually starting?
Pick your lane before you register anything. Your business model decides your structure, your licence and your first contracts.
- Small-scale extraction: you hold a title and sell what you dig, such as alluvial gold, opal or gemstones. Highest regulatory load, highest upside.
- Contract services: you work on someone else’s tenement doing drilling, haulage, maintenance or mine engineering. No mining title needed, but heavy contract and safety obligations.
- Exploration first: you hold an exploration licence, prove up a deposit, then sell it or bring in a joint venture partner. Expect years of geology spend before revenue.
- Quarrying: sand, gravel and stone sit under planning and extractive industry rules in most states rather than mining titles.
In practice, contract services is where most new mining companies we speak to begin. It’s also the path most guides skip. If that’s you, the contracts and safety steps below matter more than tenement law.
Fossicking, prospecting or mining: when does a hobby become a business?
Plenty of people come to mining through a metal detector. Fair enough. The trap is assuming the permit you bought for weekends covers a business.
In Victoria, a miner’s right costs $28.60 for 10 years. It’s for individuals only (not businesses) and limits you to hand tools. WA sells a miner’s right for $30, and it’s your entry ticket for prospecting on available land.
Bring in machinery, hire a worker or start selling finds as a regular income, and you need a title that allows mining. That means a prospecting licence, a mining claim or eventually a mining lease. Selling a few nuggets doesn’t make you a mining company. Running a sluice every weekend and invoicing a buyer probably does, so ask your accountant when the ATO would see a business rather than a hobby.
How to start a mining company in Australia: 7 steps
This order saves the most rework. Once your title application is in, steps 4 to 6 run side by side.
1. Choose your business structure
Most mining ventures end up in a Pty Ltd company, and for good reason. Mining is a high-liability activity. If a trench wall collapses or a contractor gets hurt, you want the company’s assets on the line, not your house.
Here’s how the options actually stack up:
- Sole trader: cheapest to set up. You and the business are legally the same person, so every debt and claim lands on you. Fine for testing a hobby claim. Risky once machinery and workers arrive.
- Partnership: two or more people share control and profits. Each partner can be personally liable for the whole partnership’s debts, not just their share. That surprises a lot of mining mates who go in together.
- Company: a separate legal entity that holds the title, signs the contracts and carries the liability. Base rate entities pay 25% company tax, and mine operators and lenders expect to deal with one.
- Company as trustee of a family trust: popular with contractors who want asset protection plus flexibility on distributions. Get tax advice before you set this one up.
A pattern we see again and again: founders start as sole traders, win a first mine-site contract, then scramble to switch. Moving contracts, insurance and a tenement into a new company later means extra fees, consents and paperwork. If you can see contracts coming, start as a company. Our sole trader vs company comparison walks through the trade-offs.
Next, apply for your ABN and work out when you need to register for GST (it’s compulsory once turnover hits $75,000). Two or more owners? Sign a shareholders agreement on day one. Cash calls for new equipment are the classic flashpoint between mining partners, and the agreement decides who pays.
Find the perfect lawyer to help your business today!
2. Pick your ground and check the tenement register
Check the map before you apply for anything. Each state runs an online register: Mineral Titles Online in WA, MinView in NSW, the RRAM portal in Victoria and MyMinesOnline in Queensland. Someone already holds a title over your patch? You either negotiate with them or look elsewhere.
WA lets you prospect inside another person’s exploration licence with a permit. The catch: hand tools only, no deeper than 2 metres, and samples capped at 20 kilograms. Good for a look. Useless for production.
3. Apply for the right mining title
This is the step that varies most across Australia. Here’s the entry-level title in each state for someone starting small.
| State | Entry-level title | Key limits | Regulator |
|---|---|---|---|
| WA | Prospecting licence, or special prospecting licence for gold | Up to 200 ha, 4-year term renewable once, $478 application fee, minimum spend of $40 per ha a year (at least $2,000). Gold licences cap at 10 ha. | Department of Mines, Petroleum and Exploration |
| QLD | Mining claim or prescribed mining claim | 1 ha for a standard claim, 20 ha for gemstones. No machinery on a standard claim. Maximum of 2 claims per holder. | Queensland resources department, via MyMinesOnline |
| VIC | Prospecting licence | 5 ha or less, up to 7 years, not renewable. Lets you explore and mine. | Resources Victoria |
| NSW | Mineral claim or opal prospecting licence | Only inside mineral claims districts such as Lightning Ridge and White Cliffs. Elsewhere you need an exploration licence, then a mining lease. | NSW Resources |
| SA | Precious stones claim (opal) or mineral claim | Opal claims run under the Opal Mining Act 1995 and need a precious stones prospecting permit first. | Department for Energy and Mining |
| TAS | Exploration licence, then mining lease | Ask the regulator about small-scale lease options for your mineral. | Mineral Resources Tasmania |
| NT | Mineral titles under the Mineral Titles Act | Separate permits cover extractive minerals such as sand and gravel. | NT mineral titles regulator |
Fees and limits change every 1 July. WA’s figures above come from its 2026-27 schedule, so check the current one before you lodge.
Watch for the most common wrong turn: applying for an exploration licence when you want to dig. An exploration licence lets you look, sample and drill. It won’t let you run a mine and sell what you produce. Victoria’s prospecting licence is the odd one out because it covers both. Your mining title also sits alongside the general business licences and permits every operator needs.
4. Sort land access, native title and heritage
A mining title doesn’t give you open access to the land. On freehold or a pastoral lease, you’ll need to notify the landholder and agree compensation. Queensland won’t grant a claim until you’ve reached a compensation agreement with the landholder.
Native title is the step that blows out timelines. Granting most mining titles triggers the right to negotiate under the Native Title Act 1993 (Cth). Both sides negotiate in good faith, and if there’s no deal after six months, either party can ask the National Native Title Tribunal to decide. Many operators prefer an Indigenous Land Use Agreement, which can cover several tenements at once.
Some low-impact titles qualify for a faster process. Don’t plan around it until the regulator confirms. You’ll also need a cultural heritage check with traditional owners before you disturb ground. Every state has its own heritage law, so allow months, not weeks.
5. Set up your mine safety system
General business guides go quiet here, and it’s where we see the biggest gaps. Mines run under their own safety laws. Queensland has the Mining and Quarrying Safety and Health Act 1999. NSW has the Work Health and Safety (Mines and Petroleum Sites) Act 2013. WA covers mines through its Work Health and Safety Act 2020 plus dedicated mines regulations.
What does that look like on the ground? A written safety management system. Risk assessments for mobile plant, ground stability and confined spaces. Inductions, competency checks, and fitness-for-work rules that cover drugs and alcohol. Acting as principal contractor on a site adds a project-specific WHS plan to the list.
Start with a WHS policy as your base, then build mine-specific procedures on top. An office-style policy on its own won’t satisfy a mines inspector.
6. Lodge environmental approvals and rehabilitation security
Every title comes with environmental conditions. For small operations the process is lighter, but it’s never absent. In Queensland, small-scale mining on a claim can skip a separate environmental authority if you meet the eligibility criteria. More disturbance means a full environmental authority and a work plan.
Expect to lodge security, a bond the regulator holds until you’ve rehabilitated the land. Founders forget this sits on top of equipment costs and ties up cash they can’t touch. Ask the regulator for a likely figure before you finalise your budget.
Projects near wetlands, threatened species habitat or World Heritage areas may also need a federal referral under the EPBC Act. Most small claims won’t trigger it. Check anyway.
7. Put your contracts and insurance in place
Small mining companies make or lose money in their contracts. Here’s the core set:
- Master services agreement: if you provide services to a mine operator, a master services agreement governs every job, with a statement of work for each project.
- Contractor agreements: for the drillers, operators and geologists you bring in. Use a contractor agreement and watch for sham contracting. If they work like employees, the law will probably treat them as employees.
- Equipment hire: a wet hire agreement (machine plus operator) or dry hire agreement (machine only) settles who pays when a machine breaks down.
- Confidentiality agreement: assay results and geological data are valuable. Get an NDA signed before you share them with investors or buyers.
- Sale or offtake terms: who buys your product, at what price, and when ownership passes.
Then insurance. Think public liability and other business insurance, workers compensation (compulsory once you employ), plant and equipment cover, and professional indemnity if you give engineering advice. Mine operators won’t let you on site without certificates of currency. Get quotes once your services agreement is drafted, because its indemnity clauses shape the cover you need.
How much does it cost to start a mining company?
Less than the headlines suggest if you start small. More than most people budget for. Here’s what a small operator should plan around.
| Cost | What to expect |
|---|---|
| Business set-up | Company registration, ABN, GST registration and a shareholders agreement. Hundreds to low thousands of dollars, depending on how much advice you need. |
| Title application | WA charges $478 for a prospecting licence and $703 for a mining lease in 2026-27. Other states set their own fees. |
| Rent and minimum spend | WA prospecting licences carry rent per hectare plus a minimum annual spend of $40 per ha (at least $2,000). |
| Rehabilitation security | Set by the regulator and scaled to the ground you disturb. Locked away until you rehabilitate. |
| Native title and heritage | Survey and negotiation costs vary widely. Budget for them early rather than treating them as a surprise. |
| Equipment | Opal: auger drills, winches, blowers. Alluvial gold: sluices, pumps, an excavator. Hire or buy second-hand in year one. |
| Insurance and safety | Public liability, workers compensation, plant cover, PPE, first aid and communications gear for remote sites. |
How long does it take? A small claim or prospecting licence with no objections and no native title issues can come through in a few months. Add native title negotiations or a full environmental assessment and you’re looking at a year or more. Plan your cash flow for the wait. You’ll pay rent and fees before you sell a single gram.
One more thing. Hire before you buy. Equipment you rent in year one is equipment you’re not stuck with if the ground disappoints.
What tax and royalties apply once you start producing?
Royalties go to the state, and they’re charged on what you produce, not on profit. That stings in a bad month. Gold is the clearest example of small-producer relief:
| State | Gold royalty | Relief for small producers |
|---|---|---|
| WA | 2.5% of royalty value | No royalty on the first 2,500 ounces each financial year |
| VIC | 2.75% of net market value | First 2,500 ounces a year exempt, and no royalty on gold from a prospecting licence |
Queensland, NSW and SA set their own rates, and some are linked to the commodity price. Check the current rate with your state regulator before you build a price model.
GST trips people up too. Opal, gemstones and raw gold sell like most goods: once you’re registered, you charge 10%. Refined gold is different. The first sale of refined investment-grade gold by the refiner to a dealer is GST-free, and later sales are input-taxed. Planning to refine before you sell? Get your accountant to map the GST before you set a price.
Selling a tenement is a taxable sale in most cases, so GST sits on top of the price. When the buyer pays in instalments, it’s easy to double-count or miss GST across reporting periods. We’ve seen this cause headaches at BAS lodgement time.
There’s good news on the income tax side. Spending on exploration and prospecting is deductible straight away, which helps through the lean early years. Junior explorers set up as companies may also pass losses to shareholders as credits through the Junior Minerals Exploration Incentive. Check with the ATO whether a round is open for the current year.
Legal Health Check for Small Business
What we see in Lawpath consultations about mining businesses
Lawpath’s lawyers and accountants speak with a steady stream of people setting up in mining and mining services. A few patterns keep coming up.
- Service businesses outnumber title holders. Most founders we speak with are engineers, maintenance crews or construction contractors starting a company to work on mine sites. Their first legal job is a services agreement with the mine operator, and that comes before they hire anyone.
- Award coverage catches people out. Construction work done on a mine site may fall under the Mining Industry Award rather than a construction award. Our lawyers also see casual loadings in mining contracts set too low to cover the penalties and allowances owed.
- Labour hire rules apply state by state. If your client directs the workers you supply, you may be a labour hire provider. That means a licence in every state with a licensing scheme where you place workers, not just your home state.
- Safety clauses get copied from office templates. Contracts reference general WHS law and stop there. Our lawyers recommend naming the relevant mining safety legislation and spelling out inductions, competencies and fitness-for-work rules.
- Insurance comes last when it should come second. New mining companies pitch for work with no cover in place. Draft the services agreement first, then take it to a broker so the policy matches the indemnities you’re signing.
- One-person contractors expect tax savings that don’t arrive. Engineers who incorporate to cut tax are surprised when the personal services income rules attribute the income back to them. Get that advice before you register the company, not after.
FAQ
Do I need a licence to start a mining company in Australia?
Yes, if you plan to extract and sell minerals. You need a title from your state regulator, such as a prospecting licence, mining claim or mining lease. Contract service companies working on someone else’s tenement don’t need a mining title, but they still carry mine safety duties and may need labour hire or other licences.
Can I sell gold I find with a miner’s right?
A miner’s right lets you keep what you find while prospecting with hand tools, and occasional sales are fine. Once you’re selling regularly, using machinery or employing people, you’re running a business and need a title that allows mining.
How much does it cost to start a small mining business?
Title fees are modest. WA charges $478 to apply for a prospecting licence. The real costs are rent, minimum spend, rehabilitation security, heritage surveys, equipment and insurance. Hiring equipment in year one keeps your upfront spend down.
How long does it take to get a mining licence?
A straightforward small title can take a few months. Native title negotiations, landholder objections or a full environmental assessment can stretch that past a year. Lodge early and budget for the wait.
Should my mining business be a sole trader or a Pty Ltd company?
For anything beyond a hobby claim, a Pty Ltd company is the safer choice. Mining carries serious liability risk, and a company keeps it away from your personal assets. Mine operators and lenders also prefer to contract with a company.
Do I need to consult traditional owners before I start?
Where native title exists or may exist, yes. Granting most mining titles triggers the right to negotiate, and every state requires a cultural heritage check before you disturb ground. Build months into your timeline for this.
Do small producers pay royalties on gold?
It depends on your state. WA and Victoria both exempt the first 2,500 ounces of gold each year, and Victoria charges no royalty on gold from a prospecting licence. Other states set their own rates, so check with your regulator.
Do mining contractors need their own safety system?
Yes. Contractors carry their own duties under mine safety laws, separate from the mine operator’s. Expect operators to ask for your safety management system, risk assessments, inductions and insurance certificates before you start work.
Are there grants for small mining businesses?
Some states co-fund exploration drilling, with WA’s Exploration Incentive Scheme the best-known example. Federally, the Junior Minerals Exploration Incentive helps junior explorers raise capital when a round is open. Check your state resources department for current programs.
Ready to start your mining company?
If this feels like a lot, that’s normal. Nobody gets every approval right in one go, and most of the steps above are forms, not exams. Get your structure sorted first and everything else has somewhere to land.
Register your mining company with Lawpath today and get your ASIC registration, ABN and company documents done in one place.
