I agree with most of your observations except for eliminating ALL incentive for exploration for 2 reasons: 
First, there are legitimate high potential/high risk areas where incentives may make the difference between undertaking or not undertaking an exploration effors. If they win in those efforts, so do we. Refining the incentive program, and doing a tighter, professionally-managed upfront risk-rewrad analysis and process monitoring are warrented - and that requires professional personnel and money- but it should improve the program to everyone's benefit.
Second, not all incentives need be revenue-based: There could be far more flexibility in the types of incentives the State is permitted to negotiate: For example, State-funded access roads instead of direct financial subsidies could be provided if the entrepreneur trusts their exploration effort will pan out . That approrach provides jobs for residents and support to entrpreneurs that is tied directly to their project. A win-win?