Ferguson acknowledged the government had made a commitment to examine such a scheme, but said the need to contain inflation precluded the introduction of flow-through tax deductions for now.

"We went to the election with a commitment on flow-through shares," he told Petroleum magazine in an interview to be published in its upcoming April issue.

"That was a commitment to seriously investigate this across the whole of the resources and energy sector. That's not something to be pursued in this financial year because our priority as a government is to take on the fight against inflation in this budget round. That's not going to be easy."

Ferguson said his department would examine carefully whether flow-through shares were the best form of assistance that could be given to explorers.

"You've got to do the work," he said.

"Identify the problem then have a discussion about the potential solutions. I'm not creating any expectations, nor should I, because we want to see what the key challenge is before we start arguing how taxpayers' dollars should be spent in a particular way."

The April issue of Petroleum magazine features a wide-ranging interview with Martin Ferguson. This issue will be mailed out in the second week of April and will be available at the APPEA 2008 conference.