PETROLEUM BONANZA WA gas becomes a premium fuel GAS TO

Transcription

WESTERN AUSTRALIA’S INTERNATIONAL RESOURCES DEVELOPMENT MAGAZINE December 2005–February 2006 $3 (inc GST)
PETROLEUM BONANZA
WA gas becomes a premium fuel
GAS TO LIQUIDS
Major opportunities beckon
STRAND LUMBER
Major project status for Great
Southern project
Print post approved PP 665002/00062
NICKEL
WA ready for the next leap forward
DEPARTMENT OF INDUSTRY AND RESOURCES
Investment Services
1 Adelaide Terrace
East Perth, Western Australia 6004
Tel: +61 8 9222 3333 • Fax: +61 8 9222 3862
Email: [email protected]
www.doir.wa.gov.au
Jim Limerick
INTERNATIONAL OFFICES
Europe
European Office • 5th floor, Australia Centre
Corner of Strand and Melbourne Place
London WC2B 4LG • UNITED KINGDOM
Tel: +44 20 7240 2881 • Fax: +44 20 7240 6637
From the Director General
The recent announcement that
the State Government is making
considerable changes to Western
Australia’s system of approving major
resources projects spells good news
for project proponents.
The State Government has allocated
$25 million to a reform package to
accelerate the approvals process. The
process has been one of the biggest
areas of concern for the resources
sector.
The changes are the culmination of
two years of solid negotiations by my
staff with other government agencies
and the Approvals Review Team
to agree on timelines and process
improvements.
It is a timely move for project
proponents who are anxious to bring
on new resource development projects
in these buoyant economic times.
Announcing the changes, Premier
Geoff Gallop made the point that
quicker approval times did not mean
Western Australia was lowering its
approvals standards.
The Premier will head up a
Coordinating Committee of Ministers
to ensure across-portfolio integration
of approvals for major developments.
He has appointed Mr Brendan
Hammond, formerly Managing
Director of Argyle Diamond Mines,
to coordinate inter-action between
agencies to ensure that they meet
agreed timelines. The agencies
involved include the Environmental
Protection Authority and the
Prospect
Western Australian Prospect magazine is published quarterly
by the Western Australian Government’s Department of Industry
and Resources (DoIR) and Ray Burns Media.
Departments of Conservation and
Land Management, Infrastructure and
Planning and Industry and Resources
(DoIR).
The Premier also announced the
winner of the annual Premier’s
Awards for Excellence in Public Sector
Management recently. LandCorp and
DoIR combined to win the top award.
The prestigious award acknowledged
DoIR’s and LandCorp’s role in
developing common-user facilities at
the $200 million Australian Marine
Complex at Henderson, south of
Fremantle.The award adjudicators
were particularly impressed with
how the facilities had enhanced
WA’s international manufacturing
reputation, boosting the State’s skills
capability and economy along the way.
Since opening in 2003, the commonuser facility has generated more than
$40 million in business and 600 new
jobs from 80 different projects across
the marine, defence and resources
sectors.
I offer my thanks and congratulations
to everyone involved in the
development of the Australian Marine
Complex.
Other stories in this edition of
Prospect include several with an
international focus. The usual list
of major projects in the last pages
of the publication again points to the
large number and high value of major
resource projects currently committed
or planned in Western Australia.
Cover photo: A section of the processing plant at one of
Western Australia’s newest mines, the Magellan lead mine,
near Wiluna. Photo by Martin Farquarson Photography.
India — Chennai
Western Australian Trade Office - Advisory Office
1 Doshi Regency • 876 Poonamallee High Road
Kilpauk • Chennai 600 084 • INDIA
Tel: +91 44 2640 0407 • Fax: +91 44 2643 0064
Indonesia — Jakarta
Western Australia Trade Office
JI H R Rasuna Said Kav C15 - 16, Kuningan
Jakarta 12940 • INDONESIA
Tel: +62 21 2550 5331 • Fax: +62 21 522 7103
Indonesia — Surabaya
Western Australian Trade Office
Graha Pena 17th floor • Jalan Ahmad Yani 88
Surabaya 60234 INDONESIA
Tel: +62 31 829 9979 • Fax: +62 31 829 9975
Japan — Tokyo
Government of Western Australia, Tokyo Office
13th floor, Fukoku Seimei Building
2-2-2 Uchisaiwai-cho Chyoda • TOKYO 100-0011 JAPAN
Tel: +81 3 5157 8281 • Fax: +81 3 5157 8286
Japan — Kobe
Western Australian Government Office
6th floor, Golden Sun Building • 3-6 Nakayamate-dori
4-Chome Chuo-Ku • Kobe 650-0004 JAPAN
Tel: +81 78 242 7705 • Fax: +81 78 242 7707
Malaysia — Kuala Lumpar
4th floor, UBN Tower • 10 Jalan P Ramlee
KUALA LUMPUR 50250 MALAYSIA
Tel: +60 3 2031 8175/6 • Fax: +60 3 2031 8177
Middle East — Dubai
Western Australian Trade Office • Emarat Atrium
PO Box 58007 • Dubai • UNITED ARAB EMIRATES
Tel: +971 4 343 3226 • Fax: +971 4 343 3238
E-mail: [email protected]
People’s Republic of China — Shanghai
Western Australian Trade & Investment Promotion
Shanghai Representative Office • Room 2208, CITIC Square
1168 Nanjing Road West • Shanghai 200041
PEOPLE’S REPUBLIC OF CHINA
Tel: +86 21 5292 5899 • Fax: +86 21 5292 5889
People’s Republic of China — Hangzhou
Western Australian Trade & Investment Promotion
Hangzhou Representative Office
Room 910 • World Trade Office Plaza
Zhejiang World Trade Centre
15 Shuguang Road • Hangzhou 310007
PEOPLES REPUBLIC OF CHINA
Tel: +86 571 8795 0296 • Fax: +86 571 8795 0295
South Korea — Seoul
Mr Young Chan Yu, Regional Director
Western Australian Trade & Investment Office
11th floor, Kyobo Building
1 Jongro 1-Ga, Jongro-Gu Seoul, SOUTH KOREA
Tel: +82 2 722 1217 • Fax: +82 2 722 1218
Taiwan — Taipei
WA Business Development Manager
Australian Commerce & Industry Office
Suite 2606, International Trade Building
#333 Keelung Road Section 1 • Taipei 110 TAIWAN
Tel: +886 2 8780 9118 ext 216 • Fax: +886 2 2757 6707
Editorial management: John Terrell, DoIR Communications
and Marketing. Tel: (08) 9222 3804 • Fax: (08) 9222 3069
Advertising management: Ray Burns Media,
PO Box 1230, South Perth Western Australia 6951
Tel: (08) 9227 6688 • Mobile: 0408 474 328
Disclaimer
Prospect has been compiled in good faith by the Departmentof Industry
and Resources. Opinions expressed in Prospect are those of the authors
and do not necessarily represent the views, or have the endorsement of
the Department of Industry and Resources. The Department of Industry
and Resources has used all reasonable endeavours to ensure the material
contained in this publication is correct, but it is intended to be general in
nature. No representation is made with regard to the completeness or
accuracy of the information contained herein. The Department of Industry
and Resources disclaims any or all liability for loss or damage whatsoever
suffered or incurred resulting from the use of or reliance on information
contained herein. Readers of this publication should make and rely on their
own enquiries, research and judgements in making decisions affecting
their own or any other person’s interest.
India — Mumbai
93 Jolly Maker Chambers No 2
9th floor, Nariman Point • Mumbai 400 021 INDIA
Tel: +91 22 5630 3979/74/78 • Fax: +91 22 5630 3977
Department of
Industry and Resources
www.doir.wa.gov.au
Thailand — Bangkok
WA Business Development Manager
Australian Trade Commission • Australian Embassy
37 South Sathorn Road • Bangkok 10120 • THAILAND
Tel: +662 287 2680 Ext 3307 • Fax: +662 287 2589
United States — Los Angeles
Western Australian Trade and & Investment Office
Howard Hughes Centre, 6080 Centre Drive, 6th Floor
Los Angeles, CA 90045 USA
Tel: +1 310 216 2827 • Fax: +1 310 216 5632
2
Native title breakthrough for Ord Stage 2
3
Petroleum bonanza... as Western Australia becomes a
major target for oil and gas opportunities
4
Fast track for Pluto gas development proposal
5
INTERNATIONAL FEATURE
14
Thumbs up for mining investment
16
Gas to liquid fuels opportunity in Western Australia
18
Major project status for strand lumber project
23
$90 million boost for Australian Marine Complex
26
Expansion of high-wide load corridors
28
WA’s nickel ready for the next big step
36
Major project listings
40
Resources map
Going global
This edition of Prospect has a distinctive international
flavour, with articles featuring a diverse range of
activities associated with global linkages to trade
and investment opportunities in Western Australia.
Turn to pages 5–17 for more details.
Native Title Breakthrough
for Ord Stage 2
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Looking sweet: Sugar cane and citrus fruits are among the many agricultural and horticultural options open to growers under the second stage of the
Ord Irrigation Project.
The long-awaited second stage
of the Ord River Irrigation Scheme
is now on the brink of becoming a
reality — four decades after the
project’s first stage was established.
This follows the signing in October 2005
of a native title agreement between the
Western Australian Government and
traditional landowners of the area, the
Miriuwung-Gajerrong people.
The agreement paves the way for
the development of about 65,000 ha
around Kununurra and Lake Argyle
for agricultural, industrial, residential,
commercial and tourism development.
The development is expected to create
widespread additional employment for
locals and seasonal visitors.
The original Ord irrigation project in 1963,
which involved the construction of the
Kununurra Diversion Dam plus irrigation
and associated works and development
of the Kununurra township, cost about
$20 million, of which the Commonwealth
contributed $12 million. By 1966, 31
farms irrigated from the diversion dam
had been allocated and Ord Stage 1 was
born.
Construction of the Ord River dam
followed to provide a major storage
reservoir at Lake Argyle at a cost of $22
million. This was officially opened in 1972.
Ord Stage 2 has been a work-inprogress since 1994. That year the State
Government approved the funding of
studies to see how best the irrigation
scheme could be advanced.
2
Prospect
On completion of these studies, several
project proposals were received and
considered for further development.
Treasurer Eric Ripper, as Acting Premier,
took part in the signing ceremony at Lake
Kununurra.
There are seven development and five
conservation areas involved in the historic
native title agreement that was signed
on the shores of Lake Kununurra on 6
October 2005.
He said the native title agreement
recognised the economic, social and
cultural needs of the MiriuwungGajerrong people. It would ensure that
the traditional land owners have an
opportunity to fully participate
in projects within the native title area.
The development areas are known as
Green Swamp, M2, Ord East Bank, Ord
West Bank, Mantinea, Packsaddle, and
Carlton Plains.
The conservation areas in question
are Livistona, Zimmerman, Pincombe,
Weaber Range and Ningbing which
amount to 154,000 hectares.
Green Swamp
Green Swamp is expected to be the
first of the new areas to be developed.
The proponents are J.J. McDonald &
Sons Engineering Pty Ltd of Belmont
and the Ord River District Cooperative
Ltd (Kununurra). Operating jointly as
Green Swamp Agriculture Pty Ltd,
the partnership aims to expand the
existing sugar industry by developing a
land holding of 1380 ha, subject to the
Department of Environment’s approval.
The Department of Industry and
Resources, which is overseeing the
Ord Stage 2 project on behalf of the
WA Government, is arranging economic
modelling studies for the other six
development areas. Once this is done,
options will be submitted to the Minister
for State Development for consideration.
Under the agreement involving the
Western Australian portion of the
native title area, the Western Australian
Government has committed $24 million
over 10 years to assist in the operation
of the Miriuwung-Gajerrong Corporation,
$11 million for the Ord Enhancement
Scheme to address recommendations
of the Aboriginal Social and Economic
Impact Assessment of Ord Stage 1
through improvement to government
services to Aboriginal people, and
$6 million to the Department of
Conservation and Land Management
to fund joint management arrangements
with the Miriuwung-Gajerrong people
for previously unmanaged conservation
areas.
Other money will be spent on facilities
for 19 community living areas and water
management. All up, the total package is
valued at $57 million, including a nominal
value attached to the land granted to the
Aboriginal people.
Petroleum Bonanza
Western Australia now a major target for oil and gas opportunities
BY JOHN TERRELL
Both these terms and practices are now
virtually redundant, as world crude oil
prices soar to record levels and countries
desperately try to restrict air pollution,
caused mainly from the burning of solid
and liquid fuels.
Oil and gas prices are inextricably linked
because they tend to equate to energy
content, and when the price of oil rises,
so too do prices and the demand for
natural gas and LNG. However, natural
gas is nowadays classed as a premium
fuel because of its clean-burning
capabilities, and, as a result, every
resource in every gasfield around the
world is now under serious review.
Western Australia is currently
experiencing a petroleum bonanza with
some A$26.8 billion worth of upstream
petroleum developments now in progress.
That’s unprecedented in Australia’s
history, with the level of commitment
more than double the A$12.4 billion
slated for petroleum projects in Western
Australia a year ago.
In referring to the term stranded gas, the
Director of the Department of Industry
and Resources’ Petroleum and Royalties
Division, Bill Tinapple, said: “You now
never hear that term used today, so
important has natural gas become”.
“British Gas and Total are among new
players that are keen to get a foothold
in the region. And there are many more
companies, both majors and juniors that
are seeking farm-in and other exploration
opportunities.”
BONAPARTE
BASIN
BROWSE
BASIN
Derby
Several US companies are rushing to
the west coast of Africa, which is seen
as a promising new petroleum frontier.
But, many of them are also looking to
park their investment dollars in Western
Australia, especially in view of the State’s
political stability and its low sovereign
risk.
EXMOUTH
CARNARVON
BASIN
Western
Australia
While Western Australia produced
an impressive A$10.3 billion worth of
oil, condensate and gas in 2004, the
State is still viewed internationally as
being immature and under-explored.
It certainly has plenty of potential for
substantial future discoveries to be made,
both onshore and offshore.
PERTH
BASIN
“All of a sudden, everyone seems to be
fast-tracking upstream gas projects,”
he said.
Mr Tinapple said another virtue of
Western Australia’s oil and gas potential
was its proximity to the fastest growing
economies in the world, in Asia.
“Some of the big companies that have
been partnering developments on the
North West Shelf and other parts of the
State for a long time are all of sudden
saying they want more gas.”
For details about new acreage releases,
please contact Richard Bruce (DoIR
Petroleum and Royalties Division)
+61 8 9222 3314 or by email:
[email protected]
“Because of high revenues and profits
generated by record oil prices, many
petroleum companies are flush with
funds and keen to invest in places they
have never invested in before.
And for information about a host of
downstream processing possibilities,
please contact Steve Arnott (DoIR
Investment Attraction) +61 8 9222 3333
or by email: [email protected]
OFFICER
BASIN
Perth
Western Australia’s untapped petroleum potential
Target areas for major oil and gas discoveries
Basins with commercial production
Basins with no commercial production
For example, during the entire 50-year
history of onshore exploration in Western
Australia, only 500 exploration wells have
been put down. In contrast to this, more
that 2000 wells are drilled in Texas every
month.
“Our vast onshore basins
are not only under-explored,
they are untouched in many
promising places,” Mr Tinapple
said. “And the potential is there
for some huge resources to be
found,” he added.
Broome
CANNING
BASIN
SUB BASIN
40
30
MT/a
A decade ago, some petroleum
companies operating in Western
Australia were flaring what they
categorised as waste natural gas.
And as little as three or four years
ago, the term “stranded gas” was
commonly associated with many of
the State’s offshore gasfields.
20
10
0
2004
India
2006
South Korea
2008
Taiwan
China
2010
Japan
Projected
Asian LNG
Australiangrowth
Dollar in
exchange
ratedemand
against
Source: DoIR Projections
major currencies
3
Prospect
Greyhound Pace for
Pluto Development
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The group said established customers
in Asia and potential customers in North
America had shown strong interest in
Pluto because of its potential size and
commercial flexibility.
A final investment decision is planned for
mid 2007 and LNG shipments could begin
from late 2010.
The development of the Pluto gas field
will deliver huge economic benefits for
Western Australia, among them 1500
construction and 150 permanent jobs
once the field is in production.
Woodside Petroleum Limited is fasttracking the development of one of
the most significant projects in the
history of the Australian oil and gas
industry — a $5 billion to $7 billion
liquefied natural gas (LNG) venture
based on its wholly owned Pluto gas
field.
Engineering studies started in November
with the objective of commissioning it
in five years — a speedy outcome for
hydrocarbon projects of this complexity.
The field, discovered by Woodside in April
2005, is about 190 kilometres southwest
of Karratha and 90 kilometres west of the
Woodside-operated Goodwyn production
platform on the North West Shelf.
Chief executive officer Don Voelte said
Woodside had accelerated its studies
and appraisal program to commercialise
Pluto due to a forecast strong LNG
demand window opening between 2010
and 2012 in the Asia-Pacific and North
America markets.
“Our 100 per cent ownership of the field
will enable fast yet rigorous decision
making,” Mr Voelte noted.
“We are confident that we have sufficient
gas to justify an LNG plant with a capacity
of five to seven million tonnes a year to
create enduring value for Woodside’s
shareholders and for the citizens of
Australia.”
4
Prospect
In April 2005, Woodside said wireline logs
indicated a 225m gas column at Pluto1 with subsequent production testing
recording a flow of more than 46 million
cubic feet of gas a day.
This led analysts to suggest the field
was significantly bigger than the 2.5 Tcf
expected. In fact, the Pluto field contains
at least 3.5 Tcf of relatively dry gas.
Pluto lies between Chevron’s Wheatstone
and Urania fields to the north of the
Greater Gorgon gas resource.
Wheatstone-1 encountered a 53m
reservoir and flow tested 54 million cubic
feet a day. It is thought to contain around
2 Tcf of gas.
Urania, which was found in 2000 by
WAPET and is now owned by Chevron,
is also believed to contain around 2 Tcf.
Meanwhile Woodside is moving quickly
to improve or develop other resources
off Western Australia’s northwest coast.
Site works started in August 2005 for the
development of the fifth LNG processing
train on the Burrup Peninsula which
emphasises the group’s determination
to pursue “brownfield” as well as
“greenfield” opportunities like Pluto.
The company pointed out in a recent
review that the fifth train will increase
LNG production by 42 per cent, to nearly
16 million tonnes a year, while operating
costs will rise only 14 per cent.
This decline in unit production costs
should make the North West Shelf more
competitive, in the coming scramble for
new contracts in Asia.
But there are other projects under way
to improve the group’s efficiency, some
of them refurbishing facilities that have
been in use for 15 years, which will
absorb costs of about $1.8 billion.
Over the next five years, partners in the
North West Shelf intend to spend $360
million refurbishing LNG trains one, two
and three, another $160 million on the
venerable North Rankin platform, which
launched the venture in the 1980s (at
first delivering gas only for the domestic
market).
The first of the projects will be the
upgrading of the Wanaea-Cossack and
Lambert-Hermes oilfields, but the major
housekeeping task in gas production will
be development of a low-pressure train to
improve the flow of gas from the Goodwyn
A platform, achieved by lowering the
operating pressure of one of its two
process trains.
While most of this work has been
carried out, the demands of continuing
production mean that it will not be
completed until early next year.
The Perseus field will be connected
to Goodwyn A by 2007 to utilise spare
production capacity that will become
available.
The Angel gas and condensate field
will be developed to connect to a new
platform, and then to the existing
trunkline serving the area. It is not
expected to be commissioned until late
in 2008.
The Woodside programs, only part of
widespread development in offshore
fields on the WA coast, will confirm the
region’s role as Australia’s major source
of hydrocarbons, producing nearly two
thirds of its gas and oil.
OUR GLOBAL MARKETPLACE
Is the world shrinking, or is it getting bigger?
Both.
Shrinking when one considers the speed
of modern communications and transport
systems, and the ready access of many new
overseas markets.
And definitely bigger when the increasing
volume and diversity of products being
traded with countries like China and India
are considered.
Articles in this feature provide an insight
into the global marketplace, as it affects
Western Australia in a resources context.
5
Prospect
Skills Search Takes Off Overseass
BY SHAUN MORIARTY
Western Australia’s dramatic
resources boom is driving a huge
demand for skilled labour.
Not since the overlapping construction
of the hot briquetted iron plant near Port
Hedland and three laterite nickel projects
in the Goldfields in 1998 has there been
such a demand for skilled labour in
Western Australia — and it doesn’t look
like abating for at least the next decade.
In June 2003 Prospect Magazine reported
that the State had $27.9 billion worth of
resources projects underway or planned.
The current edition lists the total value
of resources projects at $57.6 billion.
Such is the imperative to attract skilled
migrants that the Government of Western
Australia has established a special Skills
Migration Unit within the Department of
Industry and Resources.
Overseen by the Western Australian
Skills Advisory Board (WASAB), the
Skills Migration Unit (SMU) has been
aggressively marketing the State’s
employment and lifestyle opportunities
to prospective migrants worldwide.
In September, October and November
2005 the unit participated in nine overseas
migration events including four expos
organised by the Federal Department of
Immigration, Multicultural and Indigenous
Affairs (DIMIA).
The DIMIA overseas expos — held in
London, Amsterdam, Berlin and Chennai
in India between 27 September and
13 October — attracted huge crowds of
potential migrants with a wide range of
skills.
Other overseas events included the
Working Downunder Expo in Dublin,
Opportunities Australia expo in London,
and a series of smaller migration
events held at the Western Australian
Government Offices in London.
Skills Migration Unit Manager Warren
Hill said Western Australia was one of
the most popular exhibitors at each of
the DIMIA expos.
6
Prospect
“We were overwhelmed by
the level of interest at each
event we attended,” Mr
Hill said: “It was especially
pleasing because we
had screened all visitors
beforehand to ensure we
would be dealing with
quality candidates.”
About 4000 preliminary
assessments were
conducted at the four
DIMIA expos alone, and it
is anticipated that the rate
of conversion to actual
visa sponsorship by the
Government of Western
Australia will be very high.
Among the candidates
were a high number of
engineers, tradespeople,
doctors, nurses and people
in other occupations that
are in high demand in the
State.
Skills search: WASAB Chairperson Chris Fitzhardinge (left) and Skills Migration
Project Officer Claire English interview prospective skilled migrants at the Australia
Needs Skills Expo in London.
“We really can’t say how many of these
will be sponsored, because the next
step is to sort through the preliminary
assessments and deal with each
individual case. This process involves,
among other things, having their
qualifications assessed by the relevant
Australian assessment authority,” Mr
Hill said.
Back on Australian soil, a migration expo
in Melbourne attracted about 8000 people
on a single day, with some attendees
travelling from Sydney to find out about
Western Australia. A similar expo in Perth
in early November attracted nearly 3000
people.
The unit is also targeting small-tomedium sized businesses to raise
awareness about how the Western
Australian government can assist them in
sourcing skilled labour and investigate the
options for getting them into the country.
“The larger companies generally have
the resources available to conduct their
own search and recruitment campaigns
and sponsor employees while the smaller
players just don’t have the capacity,” Mr
Hill said.
Businesses in regional areas can contact
the relevant regional development
commission who then relay skills needs
information onto the Skills Migration Unit.
“There are a wide range of visa schemes
available and we can help businesses
identify the most appropriate scheme
to use to bring in the skills they need,”
Mr Hill said.
To find out more about the Skills
Migration Unit and how it can help
businesses find the skills it needs,
contact Shaun Moriarty on
(08) 9222 0427 (0421 583 822) or email
[email protected]
Information is also available on the
Government’s migration website at
www.migration.wa.gov.au
The driving force
for your energy business
p.o. box 9117, floor 20, al attar business tower,
sheikh zayed road, dubai, uae
phone: +971 4 332 0007
fax: +971 4 332 0008
email: [email protected]
In association with
Inco Joins a New Nickel Rush
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project in New Caledonia (52,000 t/a in
2008/09), taking its expected combined
production capacity to about 450,000 t/a
in 2009/10.
The core issue: Heron Resources has proved up a large laterite nickel resource in the Goongarrie area north of Kalgoorlie,
and recently joined global nickel giant INCO with the aim of bringing the resource into production.
It was Inco* that indirectly sparked
Western Australia’s famous nickel
boom in the 1960s.
Now, the Canadian nickel giant has joined
the “next generation” of laterite nickel
projects in Western Australia.
Inco and Kalgoorlie-based mineral
exploration company Heron Resources
Limited have signed a definitive joint
venture agreement to progress the
proposed $1.4 billion Kalgoorlie Nickel
Project.
The JV is based on the proposed
mining of 50,000 t/a nickel metal, plus
a hydrometallurgical processing plant
at Goongarrie, about 85 km north of
Kalgoorlie.
The presence of Inco in the Western
Australian nickel industry is an important
milestone. It will create significant local
competition, given the pre-eminent
position BHP Billiton now holds following
its acquisition of WMC Resources, and the
development of its Ravensthorpe Nickel
Project.
8
Prospect
Inco’s prime involvement in Western
Australia to date has been through the
purchase of nickel sulphide concentrate
from two mines (LionOre Australia’s
Emily Anne and Jubilee Mines’ Cosmos).
Inco’s off-take sales agreements have
helped these relatively small companies
finance mine establishment costs
in the late 1990s to the early 2000s,
and for these companies to benefit
significantly through the last two years
of unprecedented high nickel prices. Inco
has offices in Perth and Kalgoorlie in
Western Australia.
Both companies have undertaken more
nickel exploration activity, and in the case
of LionOre, expanded its local operations
through the acquisition of other
companies or the purchase of the Bulong
nickel project.
These and other off-set arrangements
have contributed about 35,000 tonnes or
10 per cent of Inco’s expected production
in 2005.
Inco’s plans through to 2009 are to bring
on stream its Voisey’s Bay project in
Canada (59,000 t/a in 2005) and Goro
The Kalgoorlie Nickel Project farm-in and
joint venture paves the way for ongoing
feasibility studies, costing about $90
million in total. The operation, which has
similar parameters to the Ravensthorpe
Nickel Project, could be producing its
first nickel about seven or eight years
from now, creating more than 1000
construction and 300 full-time jobs.
*An industrial strike within Inco in the mid
1960s caused a severe depletion of nickel
stockpiles in the western world. So much
so that it sparked a rush to find alternative
nickel mines around the world. This led to
the 1966 discovery of nickel sulphides at
Kambalda, followed by others at Nepean,
Carr Boyd Rocks, Mt Windarra and other
places in Western Australia in the late
1960s and early 70s.
Assuming its planned acquisition of
Falconbridge goes ahead, Inco is expected
to become one of the world’s leading mining
and metals companies, especially with
respect to nickel and copper. Estimated
nickel production for the proposed Inco/
Falconbridge merger in 2005 is 334,000
tonnes, making Inco the world’s largest
producer, compared with its global rivals
Norlisk (240,000 tonnes) and BHP Billiton
(152,000 tonnes). 2004 nickel production in
Western Australia was 177,000 tonnes.
US Views Western Australia
as a Solid Investment Place
Western Australia is expected to be
a major target of new investment and
trade following the recent signing of
the Free Trade Agreement between
the United States and Australia
(effective from 1 January 2005).
The US is already a major investor in
Western Australia’s resources sector,
and levels of bilateral trade are expected
to broaden greatly in the post FTA era.
Over the years, companies like Alcoa
(bauxite/alumina production), Newmont
Mining (the Fimiston Super Pit, Jundee
and Boddington), Apache and Chevron
Texaco (oil and gas), and Kerr McGee and
Lyondell (titanium pigment production)
have committed tens of billions of dollars
in resources development projects in WA.
Major winners of the future will also
include knowledge-driven industries
such as information and communications
technologies, biotechnology, marine and
defence, creative industries, food and
beverages and agribusiness.
US companies of this ilk — Motorola, IBM
and defence systems provider Raytheon
— are securely established in Western
Australia, and are set to gain a stronger
foothold in WA in the years ahead.
Conversely, numerous Western
Australian companies are active in the
US. These include accredited livestock
exporter James Commodity Exports,
seafood and pearl exporters Nor-West
Sound investment place: US companies, like Newmont Mining at the Jundee gold mine, have invested billions of dollars in
Western Australia’s resources sector.
Seafoods and the MG Kailis Group,
electrical and mechanical machinery
exporter TGE Energy Services, and
numerous ICT companies such as QR
Sciences, Brookstone, Palmteq and
Empired.
Interestingly, an estimated 6000 people of
American origin currently live in Western
Australia.
One of them is millionaire businessman
Jack Bendat who says Western Australia
has grown from a branch office economy
to a major business centre over the past
40 years.
“Western Australia has it all — a
perfect climate, it is rich in minerals
and agriculture, and it has limitless
opportunities,” said the 80-year old
entrepreneur who arrived in Perth from
California in 1966, and successfully
developed several shopping centres,
television and radio networks and a
winery.
“Many of Australia’s big offices are
currently located in the Eastern States,”
Mr Bendat said. “I predict this will
change over the next 20 years, with many
companies heading west to Perth.”
New LA Appointment
A former Western Australian with
a diverse professional life has
been appointed to head up the
State Government’s new trade and
investment office in Los Angeles.
David Doepel (46), who has lived in the
United States since 1987, took up the new
regional director’s position in October.
In Australia, Mr Doepel worked in a
nickel mine, as a research biochemist
at Murdoch University, and as a Uniting
Church parish minister. While in America,
he has been an entrepreneur and small
business owner in Boston and Miami.
One of his business partnerships included
a firm which specialised in business
engineering and re-engineering through
the Internet for medically orientated
companies. Another of his companies
launched the brand Taste Down Under,
which promoted Australian ingredients
and cuisine in the US and brought US
Chefs to Australia.
Another strong aspect of Mr Doepel’s
work was to support and organise visiting
Australian chefs to the United States with
dinners at the Australian Embassy in
LA, and similar functions which focused
on encouraging Australian trade and
supporting passage of the Free Trade
Agreement.
9
Prospect
It’s a Gem of a Business
BY SONIA GRINCERI
India’s gem and jewellery industry
is the country’s leading export
earner at US $10 billion (16 per
cent of total exports), with Western
Australia’s Argyle diamonds being
a major contributing force behind
the industry’s phenomenal export
growth and development.
Diamonds are no longer the domain of
a wealthy elite or a special celebration
purchase.
Indian diamond merchants and jewellery
manufacturers have been quick off the
mark to recognise the fact that diamonds
are every girl’s best friend, and many
of Argyle Diamonds’ less expensive
diamonds are finding their way into gift
boxes and ultimately on to the hands of
a growing number of Indian women.
Today, 95 per cent of Argyle diamonds
find their way to India via Antwerp,
a global diamond buying centre
where stones are valued and sold
predominantly to merchants from India’s
Jain community who dominate India’s
diamond jewellery industry based in
Mumbai and Gujarat from where the
community originates.
Essentially family businesses, Indian
diamond merchants and manufacturers
are a force to be reckoned with. Where
Israel once led the world in the art of
cutting and polishing the gemstones,
today most of the cutting, polishing and
manufacturing are undertaken in India.
The person responsible for marketing
Argyle Diamonds to India is Rio
Tinto’s, Nirupa Bhatt. Ms Bhatt is an
industry rarity. Not only is she a woman
succeeding in a man’s world, but she
is doing so with a community that
traditionally tends to prefer women
to keep a low profile and immerse
themselves in a home-maker role and
function.
That’s not quite Ms Bhatt’s style. In
her beautifully draped saris, Ms Bhatt
10
Prospect
At the cutting edge: Western Australian Premier Dr Geoff Gallop (centre) on a visit to a diamond processing factory in Mumbai,
India.
manages these seasoned negotiators
with great élan. Along the way she has
been the recipient of Indian business
awards, and recently has been recognised
by the global gem and jewellery industry.
The Premier of Western Australia, Dr
Geoff Gallop, on his recent visit to India,
met with the president and members of
the Gem and Jewellery Council of India
and undertook a site visit to InterJewel, a
cutting, sorting and jewellery design and
manufacturing facility located in the Free
Trade Zone on the outskirts of Mumbai.
InterJewel’s Mumbai operations employ
some 850 workers who produce diamond
jewellery exclusively for international
markets in the US, Europe and South
East Asia.
The hard and difficult to cut Argyle
diamonds are worked on by skilled and
experienced cutters who manage to cut
delicate and multi facets into the most
minute gemstones.
To cater for the preferences of each
market, InterJewel, like many other
manufacturing units, employs both local
Indian and international designers.
The manufacturing process for mass
jewellery entails producing a silver
casting from a selected design, which
is then used to create a rubber mould.
Liquid wax is next injected into the mould.
On hardening, diamonds are placed
in the wax which is also checked for
imperfections. Plaster of paris is poured
onto the wax jewellery to create another
mould. On hardening, gold is poured
into the plaster of paris mould and onto
the wax piece of jewellery at a specific
temperature which enables the gold to
replace the wax and hold the diamonds
in a fixed setting. This is clearly, a very
labour intensive process.
To provide the talented pool of Western
Australian-based designers with an
opportunity to showcase their work and
skills to Indian manufacturers, Dr Gallop
and the Chairman of the Indian Gem and
Jewellery Export Promotional Council,
Mr Bakul Mehta, have agreed to provide
space for WA jewellery designers at the
International Jewellery exhibition to be
held in Mumbai in April 2006.
Participation in the event will be
coordinated by the Western Australia
Trade and Investment Office in Mumbai.
Sinosteel Matches Midwest
Iron Ore Commitment
In a strengthening of SinoAustralian relations, one of China’s
largest and most influential Stateowned enterprises has agreed to
share the study costs to test the
feasibility of developing the Midwest
Corporation’s Weld Range haematite
and Koolanooka magnetite iron ore
deposits inland from Geraldton.
The joint venture agreement between
Sinosteel and Midwest created history
in that it was the first time that a Chinese
and an Australian company had agreed
to take the same level of risk — $16.3
million each — in the early stages of
a major iron ore project in Western
Australia.
The deal could eventually see $1.5
billion invested in the development
of two major mines, and substantial
infrastructure such as railways, pipelines
and port facilities, as well as generate
employment and service opportunities
for many Western Australians.
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The President of Sinosteel, Huang
Tianwen, who visited Perth for the joint
venture signing ceremony in October,
said the feasibility process would be fasttracked, though he would not speculate if
and when mining would commence.
“It is with great pride that we join this
project, and we want to be involved for the
long term because China is in great need
of iron and steel products in support of
its ongoing nation-building program,”
Mr Tianwen said.
For example, 2005 steel consumption
in China is expected to be around 270 Mt,
while next year it is expected to rise to
about 340 Mt.
Sinosteel hopes to earn a 50 per cent
stake in both the Weld Range and
Koolanooka projects, the highest equity
by a Chinese company in a Western
Australian iron ore operation.
With the port of Geraldton experiencing
difficulties with large volumes of exports
(it is currently restricted to Cape size
vessels), authorities are examining
alternative sites for a new port.
Pick of the outcrops: An example of some of the outcropping
haematite iron ore, grading 55 per cent iron, within the Weld
Range resource.
Oakajee, about 20 km north of Geraldton,
is a possibility. Any support for a major
new deep-water port there would
be predicated on the facilities and
infrastructure being common-user, and
not dedicated to a single company or
consortium.
According to previously published
material, Weld Range is thought to have a
measured indicated and inferred resource
of 132 Mt @ +55 per cent haematite,
while the figure for Koolanooka is in the
order of 430 Mt @ 35 per cent Fe (primary
magnetite).
Where Culture Meets Development
Developing mutual trust and respect
for one’s culture are important
ingredients in building strong business
relationships with Chinese people.
This was amply demonstrated in October
when Sinosteel, partners of Midwest
Corporation in a joint venture iron ore
project in Western Australia, provided
$50,000 sponsorship for the visit to China
of the West Australian Ballet.
At the end of the ballet, Major General
Jeffery delivered a speech congratulating
the players, artistic director and
choreographer for their fine artistic flair,
and expressed gratitude to Sinosteel for
their sponsorship and promotion of the
Sino-Australian cultural exchange.
In May 2006, the North West Shelf
Venture participants will be sponsoring
a five city visit to China of the West
Australian Symphony Orchestra.
The visit included performances of the
ballet La Boheme in Beijing, Nanjing,
Hangzhou and Shanghai between 15 and
29 October to the rapturous acclaim of
local audiences. The ballet, developed by
the WA Ballet, is based on the opera story
and adapts the opera to dance.
On the evening of 16 October, Australian
Governor-General, Major General
Michael Jeffery, was among about 1000
people who appreciated one of two
performances in Beijing.
12
Prospect
Cultural exchange: A scene from the Sinosteel-sponsored
performance of La Boheme by the West Australian Ballet in
Beijing in October. While in Beijing, WA ballet officials Louise
Howden-Smith and Simon Dow spent time with a local ballet
company as part of West Australian Ballet’s Community
Education Program.
Chinese Honour For DoIR Geologist
Globe-trotting Western Australia
geologist Dr Franco Pirajno has left
his mark in yet another domain.
He was recently awarded the position of
Honorary Professor at China University of
Geosciences – Beijing, in recognition of
his role in assisting the development of
several young Chinese geologists and the
supervision of PhD students.
Along the way he has published 12 papers
on the geology of China and contributed
to the editing of more than 100 papers
for the university journal, Earth Science
Frontier.
Dr Franco, who has been with the
Department of Industry and Resources’
Geological Survey Division for 12 years,
has a distinguished career as a geologist
in Africa, Australia, New Zealand,
Southwest Pacific and China working with
academia, industry and government.
Over the past decade he has gained
significant expertise on aspects of
Chinese geology and been invited to
speak at many geological meetings in
China.
New outback experience: Against the backdrop of the Altay
Mountains (northern Xinjiang province, on the ChinaMongolia border), Western Australia’s Dr Franco Pirajno
shares a moment with Professor Yanjing Chen from Peking
University.
Magellan Sets Sail with Lead Cargo
Magellan: Western Australia’s only stand-alone lead mine has already chalked up five export consignments of lead to global markets since commencing operations in Q3 2005.
With a name like Magellan, there had
to be a ship involved somewhere in
the company’s development plans.
Magellan Metals, which takes its name
from the famous Portuguese sailor/
explorer Ferdinand Magellan (1480–1521),
is in the business of lead production and
exports. And between the official opening
of the company’s $35 million mine near
Wiluna in September and November
it had dispatched four cargoes of lead
concentrates by ship to China, with a fifth
planned before
Christmas. The product is shipped from
the State via the port of Esperance.
The Magellan lead mine, the only standalone lead operation in Western Australia,
is geared to produce 150,000 tonnes of
lead concentrates annually from 2006,
which is close to 3 per cent
of global lead mining production.
It will be one of the lowest cost lead
mines in the world, according to Trevor
Eyton, the Chairman of Ivernia Inc, a
Toronto-based resources company
which has 100 per cent ownership of the
Magellan mine.
There is a strong and increasing global
demand for lead, fuelled by the rapid
growth in China’s vehicle fleet and the
subsequent demand for electricalstorage batteries.
With lead now in short supply and
analysts’ forecasts predicting a continued
growth in demand, the Magellan project
will became a vital player in the world
lead market.
The project will generate royalties for
Western Australia, as well as provide
110 full time jobs.
13
Prospect
Thumbs Up for Australian
Mining Investment
Australia is the least risky place
for mining investment in the world.
That was confirmed by leading US
mineral industry consultant Behre
Dolbear and Company Inc in its 2005
global survey of the mining industry.
Of the 25 countries assessed, Australia
ranked either equal first or equal second
in all measures, scoring 59 out of a
possible 70.
The five highest ranking countries were:
1. Australia (59/70)
2. Canada (56)
3. Chile (51)
3. United States (51)
5. Mexico (48)
The list — known colloquially as the
“Where not to invest” for the lower
ranking countries — has been compiled
since 1999 and ranks countries which
are host to major exploration or mineral
development efforts and/or mining
operations according to their economic,
political and tax regimes; social issues
affecting mining; delays and bureaucracy;
corruption and political stability.
The Behre Dolbear rating is, in effect,
a huge feather in the cap of the Western
Australian resources industry because
WA is by far Australia’s largest mining
State, accounting for more than A$18
billion in production, plus tens of billions
of dollars worth of investment in ongoing
primary and downstream processing
projects.
Western Australia has an impressive
1055 mine sites (from 520 different
projects), and 169 operational mineral
processing plants.
It also continues to be the most favoured
part of Australia for mineral exploration,
with about A$530 million being spent
annually, or 59 per cent of all exploration
across the country, taking place in WA.
On the global stage, Western Australia
commands a significant share of world
production for a number of commodities.
The State’s share of world production in
2004 was:
Tantalum
55%
Zircon
36%
Diamonds (mainly industrial grade)
14%
Rutile
27%
Alumina
17%
Ilmenite
19%
Nickel
15%
Iron Ore (seaborne trade)
17%
Gold
LNG
7%
Salt
5%
There are plenty of new opportunities
for resources investment in Western
Australia. For more details, link to:
www.doir.wa.gov.au/investment/index.asp
For more details about the Behre
Dolbear global resources survey, link to:
www.dolbear.com/Publications/
CountryRankings05.pdf
Plenty of blue sky: Australia — in effect Western Australia because it is the
nation’s No. 1 mining State — was rated ahead of Canada, Chile and the US as
the best place in the world for mining investment.
Photo by Martin Farquarson Photography.
14
Prospect
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Gas-to-Liquids
With its world-class gas resources
and track-record as a reliable
supplier of liquefied natural gas
(LNG) to global markets, Western
Australia (WA) is on the threshold
of an exciting new gas processing
opportunity.
It relates to the challenge of converting
a large proportion of the State’s
considerable natural gas resources into
premium liquid fuels, better known as
gas-to-liquid fuels or GTL.
The basic GTL fuels technology has been
successfully employed for many years
and the world now has to deal with crude
oil shortages and substantially higher
fuel and energy costs. GTL is seen as
an ideal replacement for conventionally
produced diesel and distillate products
derived from crude oil refineries,
which are often major contributors to
greenhouse emissions.
GTL is therefore becoming increasingly
popular as the world strives to meet
higher environmental standards,
especially with respect to air quality.
Gas processing: A gas-to-liquids plant like this one in Nigeria could easily be built in Western Australia.
All the State of Western Australia is looking for is a prospective developer.
potential GTL project development will be
driven by the level of demand certainty in
the relevant gas markets.
The Wood Mackenzie study provides a
commercial perspective for industry to
justify LNG and GTL project investment
decisions.
The study maps-out three possible future
gas demand scenarios for Western
Australia, recognising that timing of a
16
Prospect
•
The Base Case Gas Demand scenario
indicates there are sufficient known
gas reserves in Western Australia to
meet WA’s Domestic Gas demand,
provide gas supplies to the Eastern
States and supply additional gas for
LNG and GTL export markets for the
next 60 years.
•
Despite significantly higher levels of
gas demand for the High Case Gas
Demand scenario, there are sufficient
known WA gas reserves to meet any
additional domestic demand, plus
growth in demand relating to potential
LNG and GTL export projects and the
expected Eastern States Domestic
Gas market, until 2048.
•
In the High Case Demand scenario,
99,379 PJ of 2P* gas reserves and
24,732 PJ of YTF gas reserves will be
available in Western Australia at 2020.
These reserves will be sufficient to
meet gas demand to 2048.
•
In the High Case Gas Demand
scenario, it is estimated that Western
Australia will have 62,717 PJ of
The key findings of the Wood MacKenzie
study are outlined in this article.
•
Western Australia has large and
uncommitted gas resources which
could potentially be converted into
GTL for supply to the Australian and/
or international transport fuels and
petrochemicals markets.
This major opportunity was confirmed
in the recently completed “Study of the
Western Australian Natural Gas Resource
Utilisation Options – 2004/2020”,
which was undertaken by consultants
Wood Mackenzie on behalf of the WA
Department of Industry and Resources.
Findings from the three gas demand
scenarios
Base Case 1, Gas Demand: This takes
into account an average Western
Australian Domestic Gas market
growth of 2.7 per cent per annum.
It assumes that gas will be supplied
to Eastern Australia from 2015, that
two 80,000 bbl/day GTL plants will be
commissioned and that there will be
10 mmt/a of additional LNG demand
by 2020.
•
Base Case 2 Gas Demand: This
is identical to the first case, but
assumes no WA gas is supplied to
eastern Australia.
•
High Case Gas Demand: This takes
into account an average WA domestic
gas market growth of 3.8 per cent
per annum. It assumes that gas will
be supplied to eastern Australia from
2012, that three 80,000 bbl/day GTL
plants will be commissioned and that
there will be 20 mmt/a of additional
LNG demand by 2020.
Opportunities Beckon For A World-class
GTL Industry In Western Australia
uncontracted 2P* gas reserves in
2020. This is sufficient to supply 57
mmt/a of LNG over 20 years, (13.6
x 4.2 mmt/a LNG trains) or 868,000
bbl/day of GTL fuels over 20 years (6.2
x 140,000 bbl/day GTL plants).
Western Australia’s gas resources
Large gas fields exist in the Carnarvon
and Browse Basins located off the
northwest coast of Western Australia.
Only 8 per cent of an estimated 164,466
PJ of remaining discovered reserves are
currently contracted and committed for
development.
Western Australia’s world
competitiveness in LNG markets
Western Australia has been in the LNG
export business since 1989, during which
time it has proved itself as a reliable and
internationally competitive supplier of
LNG to markets in Japan, Korea, Europe
and the United States.
The study shows that the North West
Shelf Gas Project (NWSGP) competes
favourably in international LNG markets
with all its main competitors, with the
exception of Indonesia, in Japan, China,
the West Coast of the USA/Mexico and
in Singapore. The NWSGP is competitive
against all other LNG suppliers in the
Korean market.
The challenge for prospective GTL
producers
Western Australia’s largest gas producers
have a choice of major gas markets
when considering the commercialisation
of their natural gas reserves. The four
major markets are: the WA and Eastern
States Domestic Gas markets, the LNG
and GTL fuel and GTL products markets.
The economic and commercial drivers
for developing the gas resources are
numerous, but timing and scope of
development will be driven by the level
of demand certainty in the relevant gas
markets.
LNG is currently dominating the
global gas market, providing large gas
producers with certainty of high levels of
gas demand. However,
the GTL fuels and
products markets
are likely to provide
very strong gas sales
opportunities in the near
future.
The main challenge
for WA-based GTL
fuels producers is to
identify viable GTL
fuels projects based on
gas supply contracts
which provide gas
producers with equal or
better rates of return
than those achievable
from producing and
subsequently marketing
LNG into world LNG
markets.
The Wood Mackenzie
study shows that for the
NWSGP and the other
WA gas resources, the
estimated GTL profit
margins for sales to the
Singapore market are
greater than the LNG
project margins for LNG
sales to China and the
West Coast of the USA/
Mexico.
BONAPARTE
BASIN
BROWSE
BASIN
CARNARVON
BASIN
21.6 Tcf
26.5 Tcf
83.9 Tcf
Broome
Karratha
Western Australia
0.05 Tcf
PERTH
BASIN
Perth
WA natural gas reserves (2004) by basin
Western Australia’s world
competitiveness in GTL markets
The Wood Mackenzie study demonstrates
that, over the next decade, Western
Australia could be internationally
competitive as a major GTL fuels supplier.
As a result, potential GTL producers can
be expected to soon seek gas supply
contracts with the Joint Venture Partners
of both the NWSGP and the Greater
Gorgon gas project, in the Carnarvon
Basin, as well as gas resources owners in
the Browse Basin.
producer profit margins) for commercially
viable GTL fuels production in WA.
More details
For more information about the GTL
potential in Western Australia please
contact Mr David Ryan, Department of
Industry and Resources on +61 8 9222 0477,
or by email: [email protected]
Gas supplied from these large gas
resource areas could provide sufficient
gas reserves, at competitive break-even
gas production costs (with attractive gas
17
Prospect
Major Status for Great Southern
her
Strand Lumber Project
Good progress continues to be made
with Lignor Pty Ltd’s proposed $200
million engineered strand lumber
project in the Great Southern, near
Albany.
The company recently raised $5 million
which is being used to complete
engineering design and feasibility
studies. It anticipates being in a position
to have financial closure by mid-2006 and
commence construction in the second
half of the year.
The Commonwealth
Government has
awarded Lignor Major
Project Facilitation
Status for the project.
The project will process
plantation hardwood
timber to produce the lumber using
innovative German technology. The
process takes logs, strips the wood into
strands and then reforms it into a lumber
product using heat, glue and pressure.
The Great Southern region of Western
Australia has large hardwood plantations
under development with an annual
harvest of 2.5 million tonnes of wood
being forecast by 2008. The project offers
the opportunity of adding significant value
to plantation timber which is currently
exported in the form of unprocessed
woodchips.
The project will produce up to 260,000
m3/a of lumber in full production, worth
in the region of $270 million per
year, and will create 140 direct
jobs. Most of the timber will
be used to supply the domestic
market, although the company is
keen to develop export markets.
The timber product can be used for
structural purposes in the construction
industry and in a variety of flooring
applications.
The project will be located at the planned
Mirambeena Timber Processing Precinct
located about 12 km north of Albany,
which is being rezoned from agricultural
to industrial.
Renewable hardwood timber: Above, the source
(bluegums) and (inset) one of the many end products
(floor timber) that can be made from strand lumber.
It will be near the existing Albany
Plantation Export Company (APEC).
Other projects being planned for the area
are the Beacons bio-energy project and a
second woodchip mill.
Smoothing out
the Burrup
Some of the rough edges of an
extremely rugged Burrup Peninsula,
near Karratha, have been ironed
out with the construction of a major
service corridor through the area.
The multi-user corridor extends from
the gas processing precinct near Hearson
Cove through to the port of Dampier
several kilometres to the west.
An early beneficiary of $183 million worth
of government-funded infrastructure is
Burrup Fertilisers, a company of Indian
origin, which is commissioning a $630
million liquid ammonia plant in the area.
Expenditure on infrastructure so far
includes:
• $65 million for a seawater cooling
system;
• $24 million for dredging of a new
18
Prospect
channel for the
Dampier Port
Authority;
• $48 million for a
new bulk liquids
berth; and
• $19 million on the
east-west multi-user
service corridor.
Supply lines: Integral for the export of liquid ammonia at minus 33 degrees C
from Burrup Fertilisers’ world-class production plant on the Burrup Peninsula are
these two pipelines. The first is a 20-inch special carbon steel pipeline that is clad
in polyurethane foam and aluminium, while the second is a four-inch recirculation
line for returning ammonia vapour back to the plant.
The remaining funds
will be used to extend the
seawater cooling system and bulk liquids
berth at the Port of Dampier’s public jetty.
Another $20 million is being spent
on construction of a state-of-the-art
desalination plant to provide fresh water
for Burrup Fertilisers’ ammonia plant.
This unit will also provide water for yetto-be developed downstream processing
projects in the Hearson Cove area.
Virtually all construction work on the
new ammonia plant has been completed,
with commissioning now well advanced,
and the first exports due before the
end of the first quarter in 2006. Liquid
ammonia from the plant will be shipped
to India and used for the manufacture of
fertilisers.
To the WA economy,
it’s one very big gift box.
It’s called the Common
The CUF was expected to reach capacity
User Facility, but its
that milestone and expansion plans are
performance at this year’s
commitment from the State Government
well underway. This includes a $90 million
for Stage 1 of this expansion to assist in
Premier’s Awards was
It includes load out wharves, fabrication
accommodating the growing demand
and laydown facilities and office space. In
from a number of naval projects and the
anything but common.
the space of two years, it’s become the
resource industry.
This huge, and hugely successful, feature
of the Australian Marine Complex on
Cockburn Sound not only took off the
Marketforce LCI 0036PROSPECT
in five years. It’s now already approaching
nation’s pre-eminent facility for marinerelated industries, generating some
$40 million for the State’s economy, along
with 600 new jobs.
LandCorp and the Department of Industry
and Resources would like to congratulate
all stakeholders involved in the project.
This includes all the dedicated people who
Economy category, it took off the top prize
And this economic surprise package makes
created and now manage this world-class
as well. It’s a prime example of Public
a difference far beyond Cockburn Sound.
facility. And we thank the many clients
Sector leadership for 2005.
Studies have shown that for every new
who’ve made it such a glittering success.
job at the CUF, almost three extra jobs are
For more information visit
www.australianmarinecomplex.com.au
or contact AMC Business Development
Manager Richard Clark on +61 8 9437 0500 or
email [email protected].
The CUF, as it’s called, was created by
LandCorp and the Department of Industry
generated in the wider WA community.
and Resources, to attract big fabrication
That means around 1,500 new jobs will be
projects that would otherwise have
created outside the Complex over the next
gone overseas.
year, because of projects at the CUF.
Multi-million Dollar Blueprint Aids
BY ALLAN FRANCIS
Leading-edge chemistry: An artist’s impression of the new Minerals and Chemistry Precinct at Waterford.
Australia’s status as a leading-edge
international hydrometallurgical and
mineral processing research location
has been boosted by two Perth-based
initiatives involving federal and state
governments, universities, peak
research organisations and industry.
One initiative, with funding of more
than $100 million, is to establish a
“Minerals and Chemistry Research
and Education Precinct”. This includes
a $12 million expansion of the CSIRO
Minerals site at Waterford and the $75
million construction on adjacent land
of new facilities to accommodate Curtin
University’s Department of Applied
Chemistry and the Chemistry Centre
(WA).
The precinct will also house the
headquarters of the Centre for
Sustainable Resource Processing, the
Parker Centre and the WA office of AMIRA
International.
20
2
Prospect
P
pect
Research work carried out by these
organisations together with industry
participants will make a substantial
contribution to improving the efficiency
and competitiveness of the Australian
minerals sector. The research will also
assist in opening up new opportunities for
Australia in a wide range of areas related
to the chemical sciences.
The second initiative is the recent
awarding of $20 million from the Federal
Government’s Cooperative Research
Centres (CRC) Programme to support the
activities of the Parker CRC for Integrated
Hydrometallurgy Solutions from 2005 to
2012.
Parker Centre Chief Executive Officer
Mark Woffenden said the funding
awarded last December for a third time
under the Australian Government’s CRC
Programme of $20 million over seven
years was magnificent.
“The seven-year funding period for CRCs
is the longest commitment of Federal
funding for research in Australia,” he
said.
“The re-funding, together with the
continued financial support from the WA
State Government and industry for the
centre, is recognition of the important
research work undertaken by the centre.”
The Parker Centre has widespread
international recognition for its work
addressing the needs of Australia’s
key hydrometallurgical industries that
produce alumina, copper, gold, nickel
and zinc valued at more than $15 billion
a year. The outcomes of this work have
been applied widely throughout Australia
and overseas.
The Parker Centre has an established
track-record of working collaboratively
with research organisations in North
America, South Africa, Europe and Asia
Resources Sector
with growing interest developing in the
Middle East and South America.
The centre, established in 1992, involves
research groups from CSIRO Minerals,
Curtin University of Technology,
Murdoch University and the University
of Queensland, and nearly 20 end-users
from the minerals and related industries.
The “core” end-user participants in the
Centre are Alcan International, Alcoa
World Alumina, AngloGold Ashanti
Australia, Aughinish Alumina, BHP
Billiton, Billiton Aluminium Australia,
Hatch Associates, Queensland Alumina
and Rio Tinto.
The “supporting” end-user participants
are Barrick Gold Australia, Minara
Resources, Straits Resources, Zinifex,
Outokumpu Technology, Ciba Speciality
Chemicals, Nalco Australia, Minerals
Council of Australia, WorleyParsons,
Norsk Hydro, Central TAFE and the
Department of Industry and Resources
(WA).
Chemistry Research and Education
Precinct at Waterford to capitalise on the
collaborative opportunities offered by the
precinct.
Mr Woffenden said the new centre’s
four main activity themes would be
breakthrough technologies, process
fundamentals, technology transfer and
developing staff.
CSIRO Minerals Waterford site manager
Dr John Farrow said the precinct would
create an internationally recognised
centre of research excellence across a
number of key technologies. The vision
for the precinct also involved having
space available for industry to establish
their own independent research facilities
while at the same time having close and
ready access to leading-edge research
infrastructure and intellectual expertise.
The new centre would build on the
strengths it had already achieved, and
would focus on ongoing research for the
alumina, gold and base metals sectors,
effective delivery of research outcomes
to industry and developing innovative
technologies to exploit low-grade ores or
currently uneconomic, untapped mineral
deposits.
The Parker Centre will move its
headquarters to the new Minerals and
Dr Farrow believes the new precinct
will also allow for cost efficiencies
by bringing different (research) skills
together through collaboration and the
joint utilisation of state-of-art high-tech
research equipment.
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21
Prospect
Taking the Prospectors and
Miners Show on the Road
The Australian Prospectors
and Miners Hall of Fame has
been a roaring success since its
establishment in Kalgoorlie just over
four years ago.
Now a plan is in place to take the
Hannans North-based tourist and
mining educational attraction on the
road to spread the word about the
many milestones and social dividends
associated with one of Australia’s key
industries.
The Board of Directors of the Hall of
Fame has set a goal of raising $15 million
over the next four years to establish
a Foundation administered by an
independent Board of Governors, that will
pay for the renewal of various exhibitions,
maintenance of the various buildings
and equipment, and establish a mobile
educational mining facility.
Chairman of the Hall of Fame’s Western
Australian Gifts Committee Neil
Warburton says he has been heartened
by the good early response to the call for
assistance, with about $1.2 million being
pledged so far since the campaign started
in June.
“Apart from honouring people and events
of the past, we are especially keen to
underline the importance of mining
from an economic, environmental and
community development perspective
across Australia,” Mr Warburton said.
The roadshow will start as soon as
sufficient funds are raised.
22
Prospect
The plan is to make the roadshow
accessible to every primary and
secondary student in Australia on a
continuous rotational basis.
Affiliate mining organisations such as
the Minerals Council of Australia, State
Chambers of Minerals and Energy,
and various mining and prospectors
associations will have an opportunity
to decide on themes and content for
roadshows in their respective States.
Educating the Australian public about
the significance of mining — it generates
about $55 billion worth of exports
annually and creates about 321,000 direct
and indirect jobs throughout Australia —
is seen to be essential for the industry’s
long-term future.
There are currently two full-time
education officers working at the
Australian Prospectors and Miners Hall
of Fame in Kalgoorlie who host a steady
stream of visits by students and teachers
from different parts of Australia. Their
role is to reinforce the positive aspects
of a sustainable resources sector, things
like protection of the environment, care
for worker and community health, fair
returns for companies and the fourth
element of the quadruple bottom line
— leaving something behind for future
generations to share and enjoy.
The Hall of Fame was established on the
site of old Hannans North gold mining
lease in Kalgoorlie in November 2001,
as a Centenary of Australia project, with
funding coming from three major sources
— the Commonwealth and Western
Roadshow proposal: Organisers of the Australian
Prospectors and Miners Hall of Fame are keen to
spread messages about the importance of mining
beyond Kalgoorlie, and are planning an Australia-wide
roadshow.
Australian Governments and mining
companies — as well as contributions
from individuals.
It features many galleries — including
exploration, minerals, discovery and
finance — plus extensive outdoor displays
and an underground mine tour.
In the year to 30 June 2005 more than
50,000 people, including 8500 children,
visited the Hall of Fame, making it one
of the most popular regional tourist
attractions in Australia. September 2005
was the busiest month ever with 7000
visitors.
Companies and individuals wishing
to make donations to the APMHOF
Foundation can contact either
Neil Warburton 0408 935 014 or
[email protected], or Brian
Holmes on (08) 9387 7800.
$90 Million Boost
for the Australian
Marine Complex
The status of the Australian Marine
Complex Common User Facility
(AMC-CUF) at Henderson, south of
Perth, continues to grow following
a $90 million funding boost by the
Western Australian Government to
upgrade the site’s shipbuilding and
servicing facilities.
at the same time, which will alleviate
some of the pressure at the facility
with the demand for more naval and
resources work increasing all the time.
In particular, the AMC-CUF is keen to
assist local fabricators with the efficient
handling of modules for the booming
resources sector.
The work will see the installation of
additional common-user infrastructure,
including a floating dock and rail transfer
system to launch and retrieve large ships,
and the extension and upgrade of existing
wharves.
The new floating dock when completed
will have a lifting capacity of up to 28,000
tonne and will be capable of lifting all
of the Royal Australian Navy’s current
and planned future vessels. It will also
have the capacity to lift the majority of
Panamax class ships that travel up and
down the Western Australian coast.
The $180 million AMC-CUF has exceeded
all expectations since becoming
operational in July 2003, providing a
range of world-class services for the
petroleum, mining, and commercial and
naval ship repair industries.
The upgrade of the existing eastern wharf
will allow the accommodation of two
Anzac-class frigates and a submarine
It is planned to have the AMC-CUF’s
floating dock in operation by late 2007.
The world-class Australian Marine
Complex (AMC) comprises four precincts
— shipbuilding, technology, support
industry and fabrication. Common-user
facilities are a special feature of the
Growing reputation: The versatility of the Australian Marine
Complex at Henderson was demonstrated recently with the
load-out of a platform for Apache Northwest Pty Ltd’s John
Brookes gas and condensate development near Varanus
Island offshore from Onslow.
AMC, making it possible for companies
to tackle large-scale fabrication and
servicing contracts, using dockside
facilities on a project-by-project walk-in,
walk-out lease basis.
The AMC is now home to about 100
businesses. Its common user facilities
generate more than $40 million in
business annually, and have been
responsible for creating 600 new jobs
from 80 projects since its opening twoand-a-half years ago.
While it took more than a decade to
plan, build and implement, the AMC has
certainly been worth the wait. Growth
prospects are enormous, and so too are
the opportunities for local fabricators
who are perpetually challenged by stiff
international competition.
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23
Prospect
Resource Companies Scoop
2005 Industry and Export Awards
“Rio Tinto Iron Ore is to be congratulated
for achieving this award, which
recognises the efforts the company has
made to develop an internal structure
that ensures the Pilbara operations are
managed in the most efficient and flexible
manner, with a capability for further
expansion,” he said.
“The company holds a strategic
advantage through long-term
relationships and a range of joint
ventures with steel and trading industry
partners.
Cheers for Rio: Resources industry stalwart, Rio Tinto Iron Ore, has been rewarded for its contribution to
the WA economy and community by winning the coveted Premier’s Award for Excellence and the Minerals
and Energy Export Award.
Six companies with a strong link
to the resources sector have taken
out nine of the 15 categories at
this year’s prestigious Western
Australian Industry and Export
Awards.
One of Australia’s leading exporters, Rio
Tinto Iron Ore (RTIO), won the coveted
Premier’s Award for Excellence and the
Minerals and Energy Export Award.
The Western Australian Industry and
Export Awards are the leading business
awards in the State, with the Premier’s
Award for Excellence being awarded for
outstanding performance and overall
excellence.
Premier Geoff Gallop said Rio Tinto Iron
Ore, which represented one-quarter of
the world’s seaborne-traded iron ore
supply, had developed the capability
to bring on additional resources in the
fastest and most cost-effective manner
to meet the demands of a booming global
industry.
“Future growth will ensure Rio Tinto
continues to deliver an outstanding
economic and community benefit to WA.”
Other resource-based companies to take
home an award were Gold Corporation
(Marketing and Design Excellence Award
and Large Advanced Manufacturer
Export Award), Neptune Marine Services
(Innovation Excellence Award), Tyco Water
(Emerging Exporter Award), MetroCount
(Information and Communications Export
Award) and Risktec Australasia (Services
Export Award and Education Export
Award).
Stop Press: As Prospect magazine was
going to print, news was received from
Sydney that Rio Tinto Iron Ore had just
won the Minerals and Energy category of
the 2005 Australian Export Awards.
INVITATION FOR PUBLIC SUBMISSIONS Resources Safety Feasibility Study
State Development Minister Alan
Carpenter announced on 9 November
2005 a feasibility study into establishing
a new body to oversee health and
safety in Western Australia’s resources
industry. The study is designed to improve
occupational health and safety in the
mining, onshore petroleum and dangerous
goods industries.
The study will examine the systems,
procedures, funding requirements and
reporting processes required to operate a
leading resources Safety Authority in WA.
24
Prospect
The review is being conducted in three stages:
Stage 1 will be a review of the existing operating
safety models in Australia and overseas to
identify the key characteristics, risks and
fundamental aspects of various operating
models. Part of this will include identifying
the key competencies required and resources
needed to operate within the various models.
The study invites written public submissions,
and these should be sent by email to
[email protected] or by post to:
Dr Richard Langford
Department of Industry Resources
100 Plain Street
EAST PERTH WA 6004
Stage 2 will propose a draft safety model
framework for the WA resources industry.
Stage 3 will analyse the benefits and costs
of a new Safety Authority, including its advice
on funding and the best mode of delivery.
Consultation with industry and community
stakeholders is an important part of the
feasibility study.
Submissions will be
accepted up to 31 January
2006 and will be published
on the Resources Safety
Feasibility Study website:
www.doir.wa.gov.au/
resources_safety
MID WEST DEVELOPMENT COMMISSION
Working in the region for the region...
to make the Mid West a preferred place to live, work and invest
Building the Mid West by:
Q Facilitating Investment
Q Promoting Infrastructure Development
Live
Q Facilitating Opportunities for
Local Business
Q Developing Export Opportunities
Q Improving the level of Government
Services
Work
Invest
Q Providing Information and Advice
Ph: 9921 0702 • Fax: 9921 0707
[email protected] • www.mwdc.wa.gov.au
SGIO Building, 45 Cathedral Ave • PO Box 238, Geraldton WA 6531
Extension
E
xten
nsion of High-wide Load Corridors
n
Sound infrastructure is one of
the important prerequisites for
attracting major resource projects.
Western Australia can boast the largest
tonnage port in Australia (at Dampier),
it has some of the longest and highest
tonnage rail networks in the world
(serving the Pilbara iron ore industry),
and it has multiple massive industrial
estates in key coastal and inland parts
of the State.
Better haulage routes: Incidents like this near Kwinana will be a thing of the past once the proposed high-wide load corridor
linking Kwinana with the South West is established.
Added to that are Western Australia’s
heavy haulage (road transport) routes
which are continually being upgraded.
An example of this was a recent State
Government pledge to spend $22 million
on the extension of the High Wide
Load Corridor (HWLC) network. This
will involve $12.5 million on Corridor
2 between Kewdale and Kwinana and
$9.5 million on Corridor 1 between
Henderson and the South West. The
latter will be subject to the go-ahead for
a major project in the South-West being
confirmed.
We are currently offering
an unused high pressure
water injection pipeline in
excellent condition with
the following features.
4ID 8” Flowline
41100m length
4Manufactured by
NKT Flexible
4Located at Dampier Port
4Spooled on NKT
Unreeling Device
4Manufactured Dec 2004
4Delivered April 2005
4Price: negotiable
26
Prospect
Expressions of interest please call
Reece Power at Burrup Fertilisers
High wide loads are defined as loads of
up to eight metres high, eight metres
wide, 24 m long and 200 tonnes in weight,
which require a clearance envelope of 10
m high and 10 m wide — something that
a flourishing resources State like Western
Australia needs.
In recent years there have been
numerous requests from the Chamber
of Commerce and Industry Western
Australia (CCIWA) and members of the
heavy fabrication and mining-related
industries for the provision of road routes
that facilitate the efficient movement of
high-wide loads around the State. These
requests reflect the growing trend in
the heavy fabrication industry to achieve
significant time and cost savings, and
improved quality in major projects by
using large, prefabricated modules which
are transported to construction sites for
final assembly.
It was feared that delays in the provision
of HWLCs could compromise the ability
of Western Australian fabricators
to compete for major project work,
especially against overseas module
fabricators.
The urgency to extend Corridor 1 and
Corridor 2 was underlined by the need
to address requirements for likely major
resource projects in the South West,
fabrication tenders for projects in the
north of the State and defence contracts
based at the Australian Marine Complex
(AMC) at Henderson.
Such projects include Alcoa’s proposed
$1.5 billion upgrade of its Wagerup
alumina refinery, and work associated
with the giant Gorgon gas project and
the North West Shelf joint venturers’
LNG Train-5 project.
The recent award of the Air Warfare
Destroyer Contract to South Australia
also means that linking the AMC to all
the major metropolitan fabrication
centres will enhance the capacity
of Western Australia to participate
competitively in work arising from
this contract. Similarly, fabrication
opportunities for the Gorgon gas project
and Woodside’s LNG Train 5 project will
be enhanced by the linking of the AMC to
Kewdale/Welshpool.
27
Prospect
Strength Test
Western Australia’s
BY JOHN TERRELL
In 2004 Western Australia recorded
an output of 177,000 tonnes of nickel
(contained within nickel concentrates,
matt and refined metal) valued at
about A$3230 million. This was a slight
decrease on the previous year, but nickel
production is set to rise with two laterite
nickel projects at Ravensthorpe and
near Kalgoorlie, at advanced stages, and
several smaller nickel operations like
Cosmos and those around Kambalda
showing plenty of upside. BHP Billiton
plans to produce about 50,000 tonnes
per year of contained nickel from the
Ravensthorpe project, commencing
production by the third quarter of 2007.
In the longer term, Heron Resources
plans to produce about 50,000 tonnes
per year of contained nickel from the
Kalgoorlie nickel project, with the
bankable feasibility study for the project
expected to be completed by 2011.
The additional production from these
two projects is likely to push Western
Australia ahead of Canada on the global
production table.
World’s leading nickel producers for 2004
(production in tonnes)
Russia
315,000
Canada
180,000
Western Australia
177,000
Indonesia
144,000
New Caledonia
122,000
Sources: DoIR for Western Australia and USGS for other countries
28
Prospect
Exploration
Western Australia has about 140
nickel sulphide deposits and over 120
prospects and exploration sites scattered
throughout the Yilgarn Craton, Pilbara
Craton, Halls Creek Orogen and the
Musgrave Complex.
During 2004–05, about 170 companies
explored for nickel in Western
Australia. Exploration expenditure for
nickel–cobalt has risen sharply over the
past three years and is now at record
levels, exceeding A$140 million a year.
Expenditure in 2004–05 was slightly more
than double that during 2003–04.
Added to these are another 140 nickel
laterite deposits scattered throughout
the State, but mainly within the Yilgarn
Craton.
The only producing laterite mines in
2005 are at Murrin Murrin (60 km east
of Leonora) and at Cawse (about 55 km
northwest of Kalgoorlie).
Work is progressing rapidly at BHP
Billiton’s Ravensthorpe laterite nickel
project. The project involves openpit
mining from three adjacent nickel laterite
deposits — Halleys, Hale-Bopp, and
Shoemaker-Levy — which are estimated
to contain a total proved and probable
reserve of 263.3 Mt at 0.65 per cent Ni
and 0.029 per cent Co. Mining is due to
commence at the Halleys deposit and
is expected to continue for the first 11
years of operation. The development is
expected to produce a total of around
50,000 tonnes of contained nickel per
year, but with the grade declining after
the first seven years and hence the
output will be 30,000–35,000 tonnes per
year of contained nickel from year eight
to year 28 of the project. The project
at Ravensthorpe is on-track for initial
delivery of its mixed hydroxide product
to an expanded Yabulu refinery in
Queensland during the first half of 2007.
In the wings, Heron Resources Ltd has
signed a joint venture agreement with
Inco Ltd to develop its Kalgoorlie Nickel
Project, which has the largest resource
inventory of any Australian nickel laterite
project, with a total measured, indicated,
and inferred resource of 903 Mt grading
0.74 per cent Ni and 0.05 per cent Co
(for 6.7 Mt of contained nickel metal).
The company has plans to produce about
50,000 tonnes per year of contained
nickel.
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While that hasn’t happened — Western
Australia is still ranked third behind
Russia and Canada in terms of global
nickel production — the State is poised
for solid growth in both nickel and cobalt
production over the next few years.
Rich fields of hope
:medagVi^dcZmeZcYîjgZbâa^dc
In 1999 it was forecast that the
development of low-cost laterite
nickel mines would elevate Western
Australia to the top of world
rankings for nickel production within
four years.
L6WVhZbZiVaZmeadgVi^dcZmeZcYîjgZ
In terms of greenfields exploration focus,
the areas of greatest interest were the
northern areas of the Yilgarn Craton
(particularly the Gerry Well greenstone
belt), Kimberley region, Musgrave
Complex, and west Bangemall region.
The most notable greenfields exploration
success was at Collurabbie in the Gerry
Well greenstone belt of the Yilgarn
Craton, where WMC Resources Ltd (now
part of BHP Billiton) announced the
discovery of a new nickel province in
November 2004. The discovery is a zone
of combined nickel, copper, and platinum
group elements (PGE) mineralisation
extending over 7 km along strike.
A number of companies had brownfields
exploration success near existing
operations, including WMC Resources,
which successfully used an innovative
deep-penetrating electromagnetic
surveying technique (“Geoferret”
nickel industry ready for the nextt big
b g ste
step
ep
Taking shape: The early stages of construction work at BHP Billiton’s $1.4 billion Ravensthorpe Nickel Operation in the State’s south.
Other areas of success included the
discovery of high-grade mineralisation
at Prospero near Cosmos mine (35 km
northwest of Leinster), extending the
considerable success around Cosmos —
regarded by many as the most profitable
nickel mine in the world (on a pound for
pound basis). In the Forrestania belt,
Western Areas reported considerable
exploration success at Forrestania, with
the discovery of the rich Flying Fox T5
deposit.
2004 and 2005 also saw significant
exploration around Copernicus and
Salk North deposits in the Halls Creek
region, an area that is proving to be highly
prospective for Voisey Bay-type nickel
mineralisation.
(*%%%
Mineral resources and ore reserves
From zero resources and zero production
40 years ago, Western Australia has an
amazingly rich endowment of nickel and
cobalt. Total nickel resources in Western
Australia have increased throughout the
last decade, with this attributed to the
successful delineation of resources of
lateritic nickel. Resources of lateritic
nickel have increased about fourfold over
the past 10 years, whereas resources of
sulphide nickel have remained almost
unchanged.
The Western Australian deposits account
for about 8 per cent (10 Mt) of global
nickel resources (130 Mt) in deposits
averaging 1 per cent Ni or greater. For
cobalt, Western Australian deposits
contain about 11 per cent (1.6 Mt) of the
global cobalt resource of 15 Mt.
(%%%%
AViZgîZegdkZY egdWVWaZ bZVhjgZY ^cY^XViZY ^c[ZggZY
'*%%%
8dciV^cZYC^@i
technology) around Mount Keith. This
technology helps to better explore depths
of 150–500 m below surface.
'%%%%
&*%%%
&%%%%
*%%%
%
Hja[^YZegdkZY egdWVWaZ bZVhjgZY ^cY^XViZY ^c[ZggZY
&..+
&.., &..-
&...
'%%%
'%%&
'%%' '%%(
'%%)
L6c^X`ZaaViZgîZVcYhjae]^YZgZhdjgXZh
29
Prospect
P
THE BIG PICTURE
Economic trends
30
A pick-up in employment growth remains
the key to sustained US consumption
Prospect
Sept-05
Sept-03
Sept-01
Sept-99
Sept-97
Sept-95
Index: June 2000=100
140
120
100
80
Japan
US
Jun-05
Jun-04
Jun-03
Jun-01
40
Jun-02
60
Until recently Japan’s modest growth
has been driven by exports. However,
in a climate of improving consumer and
business sentiment and healthier corporate
balance sheets, domestic demand has
begun to strengthen. GDP expanded by, an
upwardly revised, 0.8 per cent in the June
quarter 2005 for an annual growth rate of
2.2 per cent.
Aust
Euro-zone
Major stockmarket indices Source: RBA Bulletin
90
0.85
85
0.80
80
0.70
70
65
0.65
60
0.60
55
0.55
50
0.50
45
40
TWI
Yen
US$
Euro
Australian Dollar exchange rate against
major currencies Source: RBA Bulletin
0.45
US$, Euro
0.75
75
Oct-05
Importantly, domestic demand made a
strong contribution to growth in the June
quarter, 0.6 percentage points of the
0.8 per cent growth rate. This reflected
growth in private consumption and
non-residential investment. A modest
detraction from growth as inventories
moderated suggest further production
gains in future quarters. Net exports
made their first positive contribution to
economic activity in four quarters. This
trade performance should improve as
demand for ITC continues to recover.
Japan
160
Japan’s recovery broadens
•
Euro area
US
Growth
in the
major
economies
RBA Bulletin
Australian
Dollar
exchange
rateSource:
against
Oct-04
Business investment continued its
upswing as equipment and software
spending rose, driven by high levels
of retained profits and still low interest
rates. Investment rose by 0.6 per cent
in the quarter to be up 3.4 per cent over
the year.
-4
Oct-03
•
Continuing its pre-eminent role in the
US expansion, household consumption
grew robustly by 1.0 per cent in the
June quarter for an annual rise of 3.8
per cent. This reflected durable goods
spending and was driven by moderate
growth in employment and housing price
related increases in household wealth.
-2
Oct-02
•
A rapid rise in housing prices in a number
of US regions has been a key factor driving
household consumption over the past year
or so. In California, for example, house
prices have risen at an annual rate of
over 20 per cent. This rise in home owner
wealth has driven spending, underpinned by
home equity-related borrowings. There is
now some risk that significant numbers of
homes are overvalued and, in the event
of house price falls, household spending
may slow significantly.
0
Oct-01
US GDP grew by 0.9 per cent in the
September quarter for a solid annual growth
rate of 3.6 per cent. Growth was broadbased, though still driven by consumption.
Despite some signs of softness in terms
of industrial production, retail sales and
consumer confidence, current expectations
are that economic growth will continue at
a solid pace, with growth expected to be
3.3 per cent in 2006. Hurricane Katrina is
expected to have little sustained economic
impact on the US economy as a whole.
2
JOct-00
The US economy continues to grow
solidly...
Employment growth has strengthened
moderately with non-farm payrolls
expanding by 1.8 per cent in the year to
August, leading to an unemployment
rate of 4.9 per cent in the same month.
Oct-99
Current forecasts for global GDP growth are
for continued, above-trend, growth, with the
IMF forecasting 4.3 per cent growth in 2006,
following on from a similar rate in 2005.
Around this benign outlook, however, there
are a number of risks. These risks relate
largely to asset price bubbles in the US and
China and low levels of saving and high
levels of debt in US households. In addition,
there are now concerns and some modest
signs that strong economic growth and
the effect of high oil prices are beginning
to put upwards pressure on inflation and
inflationary expectations and thus global
interest rates.
•
Percent
Global economic expansion continues apace,
with the two major drivers of recent growth,
the United States and China, both showing
stronger than expected growth in recent
quarters. Japan’s recovery continues to
show a broadening of activity with stronger
domestic demand complementing solid
exports. European growth remains weak.
Latin America and the Asian region continue
to grow supported by US and Chinese
demand, strong commodities demand and
a recovery in the global ITC trade.
4
Jun-00
Strong growth in the global economy
continues... risks persist
6
spending growth. In the absence of
additional household income growth, higher
petrol prices, high levels of household
debt and limited savings will constrain
households’ ability to further lift spending.
TWI, Yen
The Global Economy
Underpinning the improvement in Japan’s
economy is stronger employment growth,
which has boosted disposable incomes and
consumer confidence. Employment grew
by 0.5 per cent over the year to September
and unemployment has fallen to just over
4 per cent, its lowest level in seven years.
Hiring expectations remain solid suggesting
further gains in the job market.
Japan’s purchasing managers index, a
leading indicator of manufacturing activity,
stood at a seasonally adjusted 54.7 in
October, the highest reading since August
2004, up from 54.5 in September. A reading
above 50 suggests a business expansion
while a reading below the 50 point threshold
indicates a contraction.
Following June quarter growth of 3.6 per
cent for an annual rise of 7.6 per cent,
investment intentions remain solid and, as
reported in the September quarter Tankan
survey, were revised upwards, supported by
improving corporate balance sheets, cost
cutting and rising profitability. The ability
of the banking sector to support rising
growth through lending is also improving
as finance sector balance sheets continue
to be repaired.
China... growth continues unabated...
with better balance
China’s economy continued to expand
rapidly in the September quarter 2005
growing at an annual rate of 9.4 per cent
as domestic consumption and fixed capital
investment rose strongly.
•
In a welcome development, consumer
demand, as reflected in retail sales,
accelerated to 12.7 per cent over the
year from 12 per cent over the year to
August.
•
Industrial production rose by 16.5 per
cent over the year to September 2005.
Recent strength in the domestic
components of demand is a positive sign in
that it appears that some of the reliance on
exports for China’s growth is lessening. This
rebalancing process needs to continue for
China’s growth rate to be sustained.
While a rise in the importance of domestic
demand is welcome there remain concerns
about the ongoing strength of investment
growth. Despite the Chinese government’s
aim of switching growth away from
investment towards consumption to avoid
unsustainable levels of excess capacity,
investment growth continues unabated.
China’s aggregate fixed capital investment
growth was over 27 per cent in the year to
September, well above the official target
of growth of around 16 per cent a year.
Europe showing only modest signs of life
Non-Japan East Asia... improving after
2004’s moderation
•
Growth was driven primarily by changes
in inventories, which contributed 0.2
percentage point to quarter-on-quarter
real GDP growth.
•
The contribution of the other
components of domestic demand to
real growth was weak, or even absent.
In particular, the contribution of private
consumption to growth was zero, which
may partly reflect the negative impact
of rising oil prices on real income.
Investment growth increased from a
fall of 0.2 per cent in the first quarter
of 2005 to 0.2 per cent in the second
quarter. However, this partly reflected a
rebound of the weather-related decline
in construction in the previous quarter.
•
Gross capital formation made a
contribution of 0.1 percentage point
to GDP growth in the second quarter.
Meanwhile, the contribution of net
exports declined to almost zero in the
second quarter.
•
On the positive side, there have been
signs of improving business sector data
in more recent months with industrial
production rising by 2.5 per cent over
the year to August. Exports rose by over
4 per cent in the year to August. In a
turnaround from recent performance it
appears that Germany is beginning to
lead the way, though growth remains
modest.
•
The UK economy has slowed rapidly as
cooling housing price growth and higher
interest rates constrain consumption.
Softer domestic demand growth
has been compounded by weaker
merchandise exports. The labour
market has softened in consequence,
with unemployment rising from a low
2.6 per cent in January to 2.8 per cent
in September. On the positive side,
business and consumer sentiment
remain solid.
Growth in the region has picked up
moderately to 4.3 per cent in the year
to June 2005 following the softening
experienced in 2004.
The pace of European economic growth
has remained broadly stable over the past
four quarters and remained modest in the
June quarter of 2005. GDP rose by 0.3 per
cent, compared with 0.4 per cent in the first
quarter.
The region’s growth has recovered most
strongly recently in Hong Kong and
Singapore which have benefited from
integration with China’s robust growth
and strength in the biomedical industry
respectively. Thailand’s growth rate has
benefited from a recovery in tourism
following the tsunami-affected March
quarter.
Following an improvement in global ITC
product demand, key regional indicators
have begun to show some signs of life.
Industrial production recovered to 7.2 per
cent in the year to August and merchandise
exports lifted to over 15 per cent in the
same period.
Importantly for the sustainability of the
recovery in the region, domestic demand
across the region has generally been firm.
High levels of capacity utilisation has been
a stimulus to stronger investment and
retail sales have lifted, driven by rising
employment, low interest rates and rising
asset prices.
High oil prices have put upwards pressure
on regional inflation rates, and this has
been aggravated to some degree by
lower fuel subsidies in some economies.
As a consequence there has been some
moderate tightening of monetary policy
across the region.
India, which, in purchasing price parity
terms, is now the world’s fourth largest
economy, continues to grow solidly,
recording GDP growth of 8.2 per cent in
the year to the June quarter, driven by the
manufacturing and services sectors.
31
Prospect
THE BIG PICTURE
Commodity trends
32
Prospect
US$/t
1200
1000
800
600
01-Nov-05
01-Jul-05
01-Sep-05
01-May-05
01-Jan-05
01-Mar-05
01-Nov-04
01-Jul-04
01-Sep-04
01-May-04
01-Jan-04
01-Mar-04
01-Nov-03
01-Jul-03
01-Sep-03
01-May-03
01-Jan-03
01-Mar-03
400
Zinc prices Source: LME Cash Official
4250
3750
3250
2750
2250
01-Nov-05
01-Sep-05
01-Jul-05
01-May-05
01-Mar-05
01-Jan-05
01-Nov-04
01-Sep-04
01-Jul-04
01-May-04
01-Mar-04
01-Jan-04
01-Nov-03
01-Sep-03
01-Jul-03
01-May-03
01-Jan-03
01-Mar-03
1250
Copper prices Source: LME Cash Official
75.00
65.00
55.00
45.00
35.00
25.00
Source: EIA (Official Energy Statistics from the US Government)
01-Nov-05
01-Sep-05
01-Jul-05
01-Mar-05
High oil prices pressure
01-May-05
01-Jan-05
01-Jul-04
01-Sep-04
01-Nov-04
01-Mar-04
01-May-04
01-Jan-04
01-Nov-03
01-Sep-03
01-Jul-03
01-Mar-03
01-May-03
01-Jan-03
01-Jul-02
01-Sep-02
15.00
01-Nov-02
According to Macquarie Research,
the September inventory drawdown
is substantially larger than normally
experienced following the Northern
Hemisphere summer shut down.
With reduction in total reported stock
(equivalent to 6-7 weeks of Western world
consumption) the price of alumina and
rising energy cost will be key determinants
of near term aluminium price movements.
1750
01-Jan-02
Moderating influences for aluminium?
Aluminium daily prices have exhibited
substantial volatility for much of this year
peaking in March at US$2026/t followed
by a trend decline to US$1691/t in July
only to rise again to US$1993/t in October.
Unwrought aluminium inventory statistics
published by the International Aluminium
Institute show a 7 per cent increase in
inventories at the end of September 2005
compared with September 2004, but follows
a 138 thousand tonne inventory reduction
from a peak of 1,912 thousand tonnes at
the end of August. The increase in inventory
over the previous 12 months coincides
with a 5 per cent production increase in
primary aluminium for 12 months to the
end of September and a 3 per cent increase
in production capacity between December
2004 and June 2005.
01-Mar-02
Ironically, the difficulties caused by capacity
constraints are not reflected in world oil
reserves. According to the Statistical Review
of World Energy, the world’s proven oil
reserves are currently estimated at 1.19
trillion barrels. The IEA (International
Energy Agency) estimates that remaining
oil resources could last 70 years from 2003.
However, with much of this located in the
Middle East, higher petroleum prices are
stimulating exploration elsewhere.
1400
01-May-02
Oil prices still strong
The West Texas Intermediate oil price
continued an upward trend in recent months
reaching a peak of US$69.82/bbl, before
easing back somewhat to US$63.21/bbl
by mid-October. Recent softening follows
reassessment of the supply-side impacts
including that of hurricanes Katrina and
Rita. However, prices are still well above
longer-term averages with future price
trends uncertain. Supply-side disruptions in
oil production coincide with unusually low
levels of spare capacity. Recent falls in Iraqi
production further reduced spare capacity
with output down 0.4 million barrels per
day from 2.5 million barrels per day in late
2004. Prices remain sensitive to unexpected
events, particularly geopolitical instability.
US and Canadian crude steel production
declined for the year to August, with both
inventories and capacity utilisation down.
Damage to port infrastructure in New
Orleans and rising Atlantic freight charges
is compounding this downward trend,
disrupting raw material flows.
1600
US$/t
Capacity constraints and uncertainty about
suppliers’ responsiveness to increasing
capacity are also beginning to show.
Uncertainty, in particular, tends to feedback
in the form of price volatility, obscuring
underlying market signals for buyers and
sellers alike.
Iron ore
Rising ocean freight rates place additional
cost burden for buyers in a market that
has already realised substantial increases
in iron ore prices. One factor contributing
to the inexorable rise in iron ore prices
is stronger than expected Chinese crude
steel production. Despite the most recent
projections indicating China’s iron ore
output could be has high as 390 Mt for
year end 2005 growth in China’s iron ore
imports is expected to continue. According
to the AME (Australian Mineral Economics),
the strength in demand for iron ore is
manifesting in over-supply in domestic
commodity-grade product markets.
Baosteel, China’s largest steelmaker
announced plans to expand production
capacity with current production, based on
annualised figures to July, indicating total
production in excess of 23 Mt this year.
Expansion plans will increase capacity to
30 Mt/a by end of 2008.
US$/bbl (WTI)
Currently, markets are characterised by
strong demand for some commodities
and unexpected weakness in others. Over
the past year zinc and copper prices have
increased by close to 40 per cent and
35 per cent, respectively, on the year to
October. At the other extreme, nickel has
fallen 13 per cent and tin by 29 per cent.
In explaining such divergent movements,
commodity analysts point to several
underlying dynamics. Price-induced
substitution away from copper and nickel
is seen as particularly relevant in recent
times along with the increased use of scrap
material in place of primary material. A
number of metals are also experiencing
substantial inventory reductions, based
partly on uncertainty about the direction of
specific markets in the immediate future
and also on cost pressures, particularly
for downstream refiners. Recent reports
suggest some consolidation is likely as
some relatively less efficient intermediate
producers may exit the market.
2,200
Increasing electricity cost is leading to
closure of smelters – particularly in Europe
– although in the longer term increased
smelter capacity is expected in the Middle
East, Russian Federation and India. Lower
exports of aluminium from China are
also expected to tighten supplies in world
markets placing upward pressure on prices.
2,000
US$/t
1,800
1,600
In the case of alumina, there have been
reductions in forecasts for global refinery
capacity growth with supply projections
by analysts showing that new projects
are not coming into production as quickly
as envisaged. This leaves the required
utilisation rate at alumina refineries globally
well above normal levels in 2006 which
implies continuing strength in prices and
places Chinese aluminium producers, who
are the most exposed to the spot market,
under pressure. Another year of strong spot
prices will give sellers of alumina under
contract another opportunity to push for
a higher linkage to LME (London Metal
Exchange) prices in any contracts which are
coming up for renewal.
1,400
02-Oct-05
02-Jul-05
02-Apr-05
02-Jan-05
02-Jul-04
02-Oct-04
02-Apr-04
02-Jan-04
02-Jul-03
02-Oct-03
02-Jan-03
01-Apr-03
02-Jul-02
02-Oct-02
02-Apr-02
1,000
02-Jan-02
1,200
Aluminium daily prices Source: Metal Prices
19,000
18,000
17,000
US$/t
16,000
Zinc
Hurricane Katrina’s influence extended
to the zinc market in September with
248 kt of zinc stocks trapped in New Orleans
warehouses suspended from trading
on the LME. The temporary shortage
added upward impetus to already rapidly
rising zinc prices, which have risen by
approximately 40 per cent for the 12 months
to October.
15,000
14,000
13,000
12,000
01-Oct-05
30-Sep-05
31-Aug-05
31-Jul-05
30-Jun-05
31-May-05
31-Apr-05
28-Feb-05
31-Mar-05
31-Jan-05
31-Dec-04
30-Nov-04
31-Oct-04
30-Sep-04
31-Aug-04
31-Jul-04
30-Jun-04
31-May-04
30-Apr-04
29-Feb-04
31-Mar-04
31-Jan-04
10,000
31-Dec-03
11,000
Nickel prices Source: Metalprices
85
75
$US cents/dltu
65
55
45
35
25
15
On the demand side, over half of global zinc
supplies are consumed by the galvanising
industry. The proportion of zinc use in
galvanising to other uses is highest in Japan
and South Korea, which according to AME,
accounts for 65 per cent of zinc consumed
in those countries. China uses relatively
less for galvanising, accounting for only
43 per cent of total Chinese consumption.
However, China’s galvanising capacity has
grown at a compound average growth rate
of 24 per cent since 1995. With Wuhan Iron
and Steel and Tangshan adding additional
hot dip galvanising capacity, strong growth
in Chinese demand for zinc is expected
to continue into the foreseeable future.
The rapid expansion of the automotive
manufacturing industry in Central and
Eastern Europe adds additional demand and
at least partially offsets declines in the US
and EU.
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Lump
Fines
Yandi Fines
Iron ore prices get a boost
Source: TEX Report, AME
Robe Fines
An all-time high for copper
After 16 months of upward trending prices
and after having gained some 35 per cent
for the 12 months to October, the copper
market reached an all time high before
sustaining a substantial correction in late
October and in the process, wiping out gains
made during the month. As reported by
ABARE (Australian Bureau of Agricultural
and Resource Economics) world copper
prices averaged US$3430/t on average,
which is 20 per cent higher than the average
2004 price. In response to high prices, the
International Copper Group reported world
refined copper consumption declined for the
January to July 2005 period. Indeed, Asia
was the only region recording aggregate
consumption increases with China and India
increasing by 15 per cent and 10.5 per cent,
respectively, while Japanese consumption
decreased by 7 per cent, South Korean
consumption by 10 per cent and Taiwanese
consumption 11 per cent. ABARE reports
consumer destocking in the US and Europe
in response to high copper prices.
Sustained construction activity in the US
is helping to underpin strong demand as
construction spending increased by 10
per cent. Reconstruction activity following
hurricane Katrina may add to demand for
copper. China is also adding substantial
demand for copper derived from rapid
growth in production of power generating
equipment. AME reports a 90 per cent
increase in power generating capacity,
accounting for 46 per cent of copper
consumed while manufacture of copperconsuming household goods grows at
14 per cent per annum.
Nickel
In contrast to copper, nickel prices have
exhibited mixed fortunes in 2005, rising
by some 40 per cent from the end of May
2004 to the end of May 2005, peaking
at US$17,650/t. Prices then dropped
sharply to US$14,520/t by the end of June,
thereafter following a rather volatile path
to US$12,120/t by mid-October. Much of
the early price reduction (in the June-July
period) coincides with declining stainless
steel production in the US and Europe while
China reduced stockpiles in preference to
increasing imports.
Moving forward, ABARE expects nickel
production to exceed supply in 2006 and
for further supply increases in 2007 to
place downward pressure on nickel prices.
However, despite the downward trend
forecast, ABARE warn that significant
disruptions to production could cause nickel
prices to escalate.
33
Prospect
Significant resource projects underway
or planned in Western Australia
Visit us online
Western Australia continues to lead the way as Australia’s No.1
resources investment destination, with more than $57 billion worth
of projects either underway or planned for the State over the next few
years. This will bring tremendous benefits to the State including more
than 31,000 additional construction and 8000 full-time jobs.
Project
value
(estimated A$m)
Employment
Construction
Permanent
BHP Billiton’s future growth strategy
4200
900
Fortescue Metals Group’s mine, rail and port proposal
150
2400
1500
300
Gindalbie Metals’ mine and pellet plant
720
200
175
Grange Resources’ Southdown magnetite mine
560
n/a
n/a
Hamersley Iron’s port, rail and power upgrades
920
835
200
Hamersley Iron’s Yandicoogina expansion
700
650
330
1000
1000
300
800
320
65
1000
1200
270
800
900
220
HIsmelt’s pig iron and steel plant
Midwest Corp’s Koolanooka mine and pellet plant
Midwest Corp’s Weld Range mine
Mineralogy’s Cape Preston mine and pellet plant
1400
2000
400
Mt Gibson/Asia Iron’s Extension Hill magnetite project
620
400
210
Robe River’s mine, rail and port upgrades
719
750
380
Robe River’s West Angelas mine expansion
Sub total
Prospect
Subscription/Change of address
Iron and steel
Hancock Prospecting’s Hope Downs iron ore mine
Prospect can be downloaded free of
charge from the Internet by visiting the
website of the Department of Industry
and Resources at: www.doir.wa.gov.au
217
200
300
16056
10855
3300
ABN: 69 410 35 356
Name:
Position:
Organisation:
Address:
Nickel/cobalt
BHP Billiton’s Ravensthorpe mine
1800
1400
325
Heron Resources’ Goongarrie mine
1400
1000
300
Sub total
3200
2400
625
Agrium’s ammonia urea plant
900
100
300
Burrup Fertilisers’ ammonia plant
630
1100
60
Dampier Nitrogen’s ammonia-urea plant
900
1000
130
Deepak Fertilisers’ ammonia nitrate plan
399
200
150
2829
2400
640
Petrochemicals
Sub total
Type of business:
Phone number:
Email
Oil, gas and condensate
BHP Billiton’s Onslow LNG plant
4000
2500
150
11000
3000
600
2000
1500
20
240
300
15
Santos’ Tern–Petrel gasfield development
1000
n/a
n/a
Woodside’s Angel gas/condensate development
1600
n/a
n/a
Woodside’s Enfield oil development
1480
100
80
Woodside’s Pluto LNG plant
5000
1500
150
26320
8900
1015
440
1000
n/a
150
Chevron’s Gorgon gas/condensate development
North West Shelf JV’s LNG Train-5
Roc Oil’s Cliff Head oil development
Sub total
Other
Alcoa’s Pinjarra alumina refinery optimisation
Alcoa’s Wagerup refinery Train-3 expansion
1500
1000
Alinta’s Pinjarra power station
320
280
n/a
Argyle Diamonds’ underground mine
850
250
500
1500
750
400
Griffin Energy’s coal-fired power station
400
250
40
Lyondell’s titanium dioxide pigment plant expansion
470
500
200
Ord irrigation (Stage 2) project
600
650
550
Transfield’s gas turbine power plant
260
n/a
400
BGM’s Boddington Wandoo gold mine expansion
Worsley’s refinery expansion
Sundry projects — at least another
Sub total
TOTAL
900
500
150
2000
2000
300
9240
7180
2690
57645
31735
8272
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Committed Projects (as at 15/11/2005)
AMMONIA/UREA
Burrup Peninsula - Ammonia Plant
BURRUP FERTILISERS PTY LTD
Burrup Fertilisers is building an ammonia plant at the
King Bay/Hearson Cove industrial area on the Burrup
Peninsula, near Karratha. Around 760,000 t/a of liquid
ammonia will be produced and exported to India and
other world markets for the manufacture of fertilisers.
Norsk Hydro is the shipping and marketing agent for
the ammonia produced. SNC-Lavalin Australia Pty Ltd,
is the EPC contractor and Sinclair Knight Merz the
environmental management consultant for the project.
The Harriet Joint Venture has an agreement to supply
82 TJ/d of natural gas to the project. Construction
commenced on 30 April 2003 and production is planned
to start in Q3 2005. In April 2005, Yarra International,
a Norwegian fertiliser company bought a 30 percent
shareholding in this ammonia plant.
Expenditure: $630m.
Employment: Construction: 1100; Operation: 60
BAUXITE/ALUMINA
Pinjarra/Huntly - Alumina Refinery Efficiency
Upgrade to 4.2Mtpa
ALCOA WORLD ALUMINA AUSTRALIA
Alcoa commenced construction in April 2004 on an
efficiency upgrade of its Pinjarra alumina refinery to
increase capacity by 0.6 Mt/a to a total 4.2 Mt/a. The
expansion construction is about 90% complete, with the
additional alumina capacity planned to come on stream
early in 2006.
Expenditure: $440m.
Employment: Construction: 1000
Worsley - Worsley Refinery Expansion to 3.5 and
then 3.7 Mt/a
WORSLEY ALUMINA PTY LTD
BHP Billiton’s Worsley alumina refinery has environmental
approval to expand capacity to 3.5 Mt/a through its
Development Capital Program. This additional capacity
should be commissioned by Q1 2006. Worsley also has
environmental approval to expand production to 3.7 Mt/a.
and this will achieved over time by production creep.
Expenditure: $257m.
COPPER
East Pilbara – Nifty Underground Expansion
Birla is currently expanding the Nifty Copper Operation
in the East Pilbara to include an underground mining
operation from the base of the existing open cut. The
expansion will include an on-site processing facility to
produce copper concentrate. The copper concentrate will
be trucked to Port Hedland and shipped from an 18,000
tonne fully enclosed storage facility to be built by Birla on
land leased from the Port Hedland Port Authority. The
underground mine will have an annual throughput of 2.5
million tonnes with an extension to the life of mine of
10-12 years.
Expenditure: $200m.
Employment: Construction 160; Operation: 90
ELECTRICITY
Kemerton Industrial Park - Kemerton Gas Turbine
Power Plant
TRANSFIELD SERVICES
The Kemerton Power Station is the result of a competitive
bidding process to supply Western Power with 260 MW
of peak generating capacity over the next 25 years. The
plant, to be owned and operated by Transfield Services,
will be an open cycle gas turbine and be capable of
using diesel fuel as a back up. Construction of the
plant begun in Q2 of 2004 and was officially opened in
November 2005 before the start of the 2005/06 summer
peak electricity demand period. In addition to the A$260
million capital expenditure on the plant itself up to
A$40 million will be spent on connecting the plant to
the South West Interconnected System, upgrading the
Kemerton substation and building a terminal substation
at Hazelmere in the eastern suburbs of Perth.
Expenditure: $260m.
Employment: Operation: 400
IRON ORE
the first quarter of 2006. At the expanded rate of 8 Mt/a,
Koolyanobbing is expected to have a mine life of 11.5
years. This is based on a reserve estimate of 91.8 million
tonnes.
Expenditure: $75m.
Pilbara - Dampier Parker Point Port Expansion
HAMERSLEY IRON PTY LIMITED
Hamersley Iron is currently expanding the capacity of its
port facilities at Parker Point (near Dampier) from 74 Mt/a
to 95 Mt/a. This work includes a new car dumper, new rail
loop and construction of two new berths with a new ship
loader, as well as expansion of the stockpile facilities.
Completion is expected by the end of 2005.
Hamersley has committed to a further capacity expansion
to 116 Mt/a and is conducting feasibility studies to further
expand to a capacity of 140 Mt/a with the addition of a
second new car dumper.
Expenditure: $920m.
Pilbara - Power Infrastructure Enhancement
Hamersley Iron intends to install up to two additional
35 MW gas turbine generators at Paraburdoo to increase
generating capacity in the Pilbara. The company also
intends to convert an existing diesel-fired gas turbine
generator to duel fuel capability. Gas to these turbines
will be supplied by an 18 km pipeline spur from the
Goldfields Gas Transmission pipeline to the Paraburdoo
mine site. Hamersley is also undertaking several highvoltage transmission projects to cater for increase power
demand, including installing a 220 kV transformer at
the Yandicoogina substation to meet the power needs
of the current 36 Mt/a mine expansion. Another project
involves construction of a substation to interconnect
the company’s Dampier-Tom Price 220 kV transmission
line and the Robe River Cape Lambert-Pannawonica
132 kV transmission line, at a point where they cross,
approximately 75 km south of Karratha.
Pilbara - Rail Duplication from Tunkawanna to
Rosella Siding
ROBE RIVER MINING COMPANY PTY LIMITED
Robe River Mining is currently expanding the capacity of
its rail facilities by duplication of Hamersley Iron’s railway
between Tunkawanna Creek and Rosella Siding, which is
operated by Pilbara Iron Pty Ltd on behalf of Robe River
and Hamersley Iron. Expected completion is mid-2006.
Expenditure: $200m.
Pilbara - Rapid Growth Project 2
BHP BILLITON IRON ORE PTY LTD
In October 2004, BHP Billiton announced Board approval
for the US$575 million Rapid Growth Project 2 (“RGP2”)
which will increase production capacity of its Pilbara iron
ore operations to 118 Mt/a in the second half of 2006.
Expenditure: $745m.
In October 2005, BHP Billiton announced its Board
approval of the US$1.3 billion Rapid Growth Project 3
(“RGP3”) expansion which will increase capacity of its
Pilbara iron ore operations to 129 Mt/a. The key elements
of RGP3 comprise the expansion of Area C, additional
sidings on the Newman railroad, and port works at
Nelson Point and Finucane Island. Initial production is
forecast to begin in Q4 2007, with actual production of
129 Mt/a anticipated to be achieved by 2008/2009.
Expenditure: $1.7b.
Pilbara - West Angelas Mine Expansion to 25 Mt/a
ROBE RIVER MINING CO PTY LTD
Robe River is currently expanding operations at its
West Angelas mine to increase production from 20
Mt/a to 25 Mt/a. The increase in production will be
achieved through an increased mining rate at Deposit A,
minor plant modifications, an expansion to the product
stockyard, minor increases in supporting infrastructure
and purchase of additional mobile equipment. Further
capacity expansion is under consideration
Expenditure: $217m.
Koolyanobbing - Iron Ore Project
Yandicoogina - Mine Expansion
PORTMAN LIMITED
In October 2004, the Portman Board approved an
expansion of its Koolyanobbing operations to increase
iron ore production from 5 Mt/a to 8 Mt/a. This expansion
is primarily driven by the “Northern Tenements”
resources at Windarling and Mt Jackson. The upgrade
in expansion capacity is expected to be completed by
Hamersley Iron has committed to expand operations at its
Yandicoogina mine to increase production from 36 Mt/a
to 52 Mt/a. Hamersley has recently expanded the current
operation by establishing a new wet processing plant (to
process low grade ore), an overland conveyor and tertiary
crushing/screening facilities. The new expansion involves
36
Prospect
at new pit at Junction South East, new crushing and
screening plant and a new overland conveyor.
Expenditure: $700m.
IRON ORE PROCESSING
Kwinana - HIsmelt Commercial Iron Making Plant
HISMELT CORPORATION LIMITED
HIsmelt Corporation, in a joint venture with Nucor (25%),
Mitsubishi (10%) and Shougang (5%), is developing a
commercial-scale HIsmelt process plant at Kwinana,
near Perth. The first stage of the plant will produce
800,000 t/a of pig iron from iron ore fines, coal and fluxes.
Construction commenced in January 2003, with first
hot metal production in mid-2005. Commissioning is
continuing.
Expenditure: $800m.
NICKEL
Ravensthorpe - Lateritic Nickel Mine and Hydrometallurgical Processing Plant
BHP BILLITON - RAVENSTHORPE NICKEL OPERATIONS
PTY LTD
On 23 March 2004, BHP Billiton approved the
development of the Ravensthorpe Nickel Project that will
produce up to 220 000 t/a of mixed nickel/cobalt hydroxide
to be processed at QNI’s Yabulu refinery in Queensland.
Plant construction is expected to take 30 months and the
first shipment of product from Esperance to Yabulu is to
commence in early 2007.
Expenditure: $1.8b.
OIL & GAS DEVELOPMENTS
Cliff Head (Perth Offshore Basin) - Oil Field
ROC OIL (WA) PTY LTD
The development of the Cliff Head oil field, located
20km southwest of Dongara, was formally approved in
March 2005. The field will be developed using a small,
normally unmanned, offshore platform with a 15,000
bbl/d design capacity. A processing plant will be located
onshore at Arrowsmith. Proven and probable oil reserves
are estimated to be about 14 million barrels. First oil
production is scheduled to flow in the first quarter of
2006, at an initial rate in excess of 10,000 bbl/d. Cliff Head
will be the first oil field to be developed in the offshore
Perth Basin.
Expenditure: $240m.
Enfield (Carnarvon Offshore Basin) - Oil Field
WOODSIDE ENERGY LTD
Development of the Enfield project was approved in March
2004. The oil field will be developed via subsea wellheads
with flowlines tied back to a floating production, storage
and offloading (“FPSO”) vessel with disconnectable
mooring. After stabilisation, export crude oil will be
produced on board the FPSO and periodically exported
through an offloading hose to tandem moored offtake
tankers. The facilities are designed for 20 years operation,
with production expected to start up in Q4 2006.
Expenditure: $1.48b.
North West Shelf - Project Expansion - 5th LNG
Train
WOODSIDE ENERGY LTD
A final investment decision for the 4.2 Mt/a Train 5,
with an associated second LNG loading jetty and extra
processing facility support, was announced in June 2005.
Site work started in Q3 2005. The project is expected
to take approximately three years to complete, with
commissioning due to start around mid-2008 and first
LNG cargoes planned from Q4 2008.
Expenditure: $2b.
POWER STATIONS
Pinjarra - Gas Fired Cogeneration Power Project
ALINTA
Alinta is constructing two 140 MW gas-fired cogeneration
units at Alcoa’s Pinjarra refinery site. The units will
provide Alcoa with process heat for current and future
capacity increases as well as electricity for sale into the
local market. Unit 1 commenced construction in February
2004 and is expected to be completed in late 2005, with
Unit 2 scheduled for completion in September 2006.
Expenditure: $320m.
Projects Under Consideration (as at 15/11/2005)
AGRICULTURE
Mantinea Flats - Ord River Irrigation Scheme (Stage
2 Development)
The conceptual project consists of developing and
servicing approximately 80 farms (about 4200 ha total) at
Mantinea Flats for irrigated intensive horticulture which
will then be offered for sale.
Ord River - Ord River Irrigation Scheme
ORD STAGE 2 M2 AREA
The potential exists for a 30 000 ha irrigated agricultural
development immediately to the northeast of the existing
Ord Stage 1 development. Environmental approval has been
given for an irrigated agricultural project in the M2 area.
A significant milestone was passed on 6 October 2005
when a historic native title agreement between the
State Government, Miriuwung Gajerrong traditional
owners and private developer interests was reached. The
agreement has resolved native title over approximately
65,000 hectares of land that is earmarked for future
agricultural, industrial and residential development
while providing sustainable education, training, job and
business opportunities for the Aboriginal people. Further,
Aboriginal heritage studies have been completed over
the Ord Stage 2 M2 and Green Swamp areas. Finally, the
State has received and is considering an Ord Business
Case report that, among other things, investigated and
reported on current engineering costs for Ord Stage 2
M2, crop options, benchmarking these crop options on
a world scale and compared the cost of a staged versus
a single full development of the Ord Stage 2 M2 area.
Possible crops include sugar, cotton, leucaena and
horticultural crops.
Expenditure: $600m.
AMMONIA/UREA
Burrup Peninsula - Ammonia Urea Plant
DAMPIER NITROGEN
A Joint Venture has been formed between Dampier
Nitrogen and Dyno Nobel to develop an ammonia/urea
project on the Burrup Peninsula. Under the JV Dyno
Nobel and Dampier Nitrogen will co-own the ammonia
plant while Dampier Nitrogen will own the urea plant.
Dyno Nobel is also conducting a feasibility study into
developing an ammonium nitrate production facility, to
be owned by Dyno Nobel, adjacent to the ammonia/urea
plant. The development agreement could result in a
combined complex producing 2300 t/day of ammonia,
1750 t/day of urea and 235,000 t/a of ammonium nitrate.
Expenditure: $900m.
Burrup West - Ammonia Urea Plant
AGRIUM AUSTRALIA
Agrium Australia Ltd (Agrium) is proposing to develop a
A$900 million world-scale ammonia and urea plant on
a 69 ha site on the Burrup West Industrial Estate. The
plant is expected to require approximately 100 TJ/d of
natural gas to produce around 1.2 Mt/a of granular urea
and 100,000 t/a of ammonia. In December 2004, Agrium
commenced its project environmental approval process.
Plant construction is planned to start in Q1, 2007.
Expenditure: $900m.
AMMONIUM NITRATE
Burrup Peninsula, former Syntroleum site Ammonium Nitrate
DEEPAK FERTILISERS
Deepak is investigating the feasibility of an ammonium
nitrate complex on the Burrup Industrial Estate for
a plant capacity of 200,000t/a of ammonium nitrate,
170,000t/a of nitric acid with the option to either produce
or import 100,000t/a ammonia.
Expenditure: $399m.
BAUXITE/ALUMINA
Wagerup/Willowdale - Alumina Refinery Train 3
Expansion
ALCOA WORLD ALUMINA AUSTRALIA
Alcoa is investigating the feasibility of a third train
expansion at its Wagerup alumina refinery for a plant
capacity of up to 4.7 Mt/a of alumina. The environmental
assessment process is in progress with an Environmental
Review and Management Program released in May 2005.
Final environmental approvals are expected by the end
of Q1 2006.
Expenditure: $1.5b.
Worsley/Boddington - Alumina Refinery Expansion
to 4.4Mt/a
WORSLEY ALUMINA PTY LTD
BHP Billiton is considering an expansion of its Worsley
alumina refinery from 3.7 Mt/a to 4.4 Mt/a. Final
environmental approval is expected be in place by the end
of Q1 2006. A final investment decision is dependent on
market conditions.
Expenditure: $900m.
COAL
Collie - Coal Mine (Ewington I)
THE GRIFFIN COAL MINING COMPANY PTY LIMITED
Griffin Coal plans to develop its Ewington I deposit
approximately 2 km east of Collie, which has estimated
recoverable reserves of 75 Mt. Environmental approval
has been given, subject to acceptance of a final
environmental management plan. The mine will produce
about 2 Mt/a coal for private sector customers, including
the Griffin Group’s proposed nearby Bluewaters power
station.
Expenditure: $20m.
DIAMONDS
Argyle - Underground Diamond Mine
ARGYLE DIAMOND MINES PTY LIMITED
Argyle Diamonds is undertaking a $100 million feasibility
study to investigate the potential for an underground mine
at Argyle. The feasibility study will be completed by late
2005. Full production for Stage 1 (7-8 Mt/a ore extraction)
would be reached in 2011 with an average of around 17
Mcts per annum diamond production until 2018. The
second stage project will extend mine life to 2024.
Expenditure: $850m.
ELECTRICITY
Collie - Bluewaters Coal-Fired Power Station
GRIFFIN ENERGY
Griffin Energy is proposing to construct two 200MW
coal-fired power stations at the proposed Coolangatta
industrial estate, 10 km north-east of Collie. The
proposals have been through a Public Environmental
Review level of assessment and an investment decision is
not expected till the first half of 2006.
Expenditure: $400m.
GALLIUM
Pinjarra - Gallium Extraction Plant
GEO SPECIALTY CHEMICALS INC.
In March 2001, GEO Speciality Chemicals Inc of the USA
announced plans to construct a major new gallium metal
extraction facility at Pinjarra, south of Perth, on the site
of the former Rhodia gallium chloride plant. The facility
is planned to have an ultimate capacity of 100 t/a of
‘4N’ gallium metal. The gallium will be extracted from
the Bayer liquor stream generated in Alcoa’s adjacent
alumina refinery. Timing is dependent on favourable
market conditions and statutory approvals.
Expenditure: $75m.
GOLD
Boddington - Gold Mine (Wandoo Expansion)
BGM MANAGEMENT COMPANY PTY LTD
Boddington Gold Mine is managed by BGM Management
Company Pty Ltd on behalf of Newmont, AngloGold
and Newcrest. BGM has environmental approval for the
expanded Wandoo project, based on mining the extensive
bedrock resource that underlies the mined-out oxide
resource to produce up to 800,000 ounces of gold and
about 20,000 tonnes of copper concentrates per annum
over a 17 year mine life. The project may include a
dedicated 120 MW gas-fired power station. Project goahead is subject to commercial factors.
Expenditure: $1.5b.
Kalgoorlie - Kalgoorlie - Super Pit - Golden Pike
Cutback
KALGOORLIE CONSOLIDATED GOLD MINES PTY LTD
KCGM is planning to extend the life of its open-cut mine
from 2012 to 2017 with the Golden Pike Cutback. This
involves the mine moving closer to the Kalgoorlie town
centre and the need to develop additional tailings storage
facilities and waste rock dumps. KCGM is in the process
of identifying all relevant issues in a Project Definition
Document for submission to the EPA.
Sunrise Dam - Gold Mine - Underground
Development
ANGLOGOLD AUSTRALIA LTD
AngloGold Ashanti commenced underground
development in October 2003 at the Sunrise Dam gold
mine to test the feasibility of expanding to underground
operations. The study involves the development of two
declines totalling 9 km in the vicinity of previously defined
reserves. The first underground gold was produced in
Q4 2004. The company expects to make a decision on
whether to proceed to full-scale underground mining in
early 2007. A positive decision is expected to increase the
life of the project to at least 2012.
Expenditure: $87m.
HEAVY MINERAL SANDS
Jangardup South - Mineral Sands Mine
CABLE SANDS (WA) PTY LTD
Cable Sands has outlined a major titanium minerals
orebody adjacent to the D’Entrecasteaux National Park.
Feasibility and environmental studies are well advanced.
An environmental impact statement for the project is
being prepared.
Expenditure: $40m.
Kemerton - Titanium Dioxide Pigment Plant
Expansion
LYONDELL CHEMICAL COMPANY
Lyondell has approval for a major expansion of its
Kemerton titanium dioxide pigment plant near Bunbury to
190,000 t/a. Environmental approval for the proposal was
given in April 1999. A decision to proceed to this capacity
is dependent on market factors.
Expenditure: $470m.
Kwinana - Titanium Dioxide Pigment Plant
Expansion
TIWEST JOINT VENTURE
Environmental approval for the staged expansion of a
pigment plant capacity to 180,000 t/a has been given.
A decision to proceed with further stages within this
approved expansion is dependent on market conditions.
Peel - Heavy Mineral Sands Mine
OLYMPIA RESOURCES LTD
Olympia has identified a reserve of 1.17 million tonnes
of heavy mineral sands near Keysbrook, about 70 km
south of Perth. The regulatory approval process has
been initiated and land access and product off-take
agreements are under negotiation.
Final detailed mine planning and project capital costing
are near completion and Olympia plans to start mining in
late 2006.
Shark Bay - Coburn - Heavy Mineral Sands Mine
GUNSON RESOURCES LIMITED
Gunson Resources completed a bankable feasibility study
on the Coburn Project, located south of Shark Bay, about
600 km north of Perth, in December 2004. The project
consists of the Amy deposit which has a total indicated
and inferred resource estimated to be 710 million
tonnes, averaging 1.4% heavy minerals. Development of
the project is subject to Gunson gaining environmental
approvals, offtake and funding arrangements. Gunson
anticipates that mining will commence in late 2006.
Expenditure: $75m.
IRON ORE
Cape Lambert - Cape Lambert Capacity Expansion
and Stockyard Rationalisation
ROBE RIVER MINING COMPANY PTY LIMITED
Robe River Mining is considering expansion of the
capacity of its port facilities at Cape Lambert, east of
Karratha. The expansion and rationalisation works will
lift the design iron ore export capacity of the facilities to
69 Mt/a. This work includes expansion of the stockpile
stacker and reclaimer facilities and a Tug Pen at the port
to provide haven for up to four tugs.
Expenditure: $302m.
37
Prospect
Great Southern Region - Southdown Magnetite - Iron
Ore Mine
GRANGE RESOURCES LIMITED
Grange Resources Limited is undertaking a bankable
feasibility study on the Southdown magnetite iron
ore project, located approximately 90 km north-east
of Albany. The study is expected to be completed by
early 2006, and the company anticipates that, subject
to government approval, construction will commence
in the second half of 2006. In September 2005 Grange
announced an interim indicated and inferred (JORC)
resource estimate of 426.2 million tonnes of magnetite.
The company proposes to produce 6.6 Mt/a of magnetite
concentrate, which will be transported via a slurry
pipeline to the Port of Albany for export and pelletising
overseas. The EPA has set a level of assessment at Public
Environmental Review, with the Environmental Scoping
Document lodged in November 2005.
Expenditure: $560m.
Hope Downs - Iron Ore Mine
HOPE DOWNS LIMITED
Hancock Prospecting has entered into a 50:50 joint
venture with Hamersley Iron (Rio Tinto) to develop the
project. Up to 30 Mt/a of iron ore will be transported
along a spur line to be constructed to connect to the
West Angelas mine of Rio Tinto, for transport of product
to either Dampier or Cape Lambert for export. Final
approvals for the amended project are expected by the
end of 2005.
Expenditure: $1b.
Jack Hills - Iron Ore Mine
MURCHISON METALS LIMITED
Murchison Metals proposes to develop an initial 1.5 Mt/a
(Stage 1) direct shipping iron ore mine at Jack Hills, 380
km north-east of Geraldton. The company intends to
crush and screen the ore on site and truck it to Geraldton
Port for export. All necessary approvals are expected to
be in place to commence Stage 1 production in Q1 2006.
Murchison Metals is progressing a pre-feasibility study
on Stage 2 which would increase production to 10-25
Mt/a hematite. A new rail line and deep water port near
Geraldton would be required and construction on Stage 2
is predicted to commence mid-2008.
Expenditure: $26m.
Kimberley - Koolan Island Iron Ore Mine
AZTEC RESOURCES LIMITED
Aztec Resources completed a bankable feasibility study in
August 2005 to develop a mining operation based on the
ex-BHP Koolan Island iron ore deposits in Yampi Sound,
130 km north of Derby. Aztec aims to produce premium
grade iron ore at a production rate of approximately 4
Mt/a over 9-10 years. The current (JORC) resource is 53.3
million tonnes at 64% Fe, with the potential for further
resources. The project is undergoing EPA assessment
at the Assessment on Referred Information level. Aztec
anticipates that construction will commence early 2006 to
enable first ore shipment in late 2006.
Expenditure: $108m.
Mid West Region - Extension Hill Magnetite Project
MT GIBSON IRON/ASIA IRON
Asia Iron Holdings Limited is proposing to develop the
Extension Hill iron deposit near Mt Gibson, 330 km southeast of Geraldton. The project will produce up to 5 Mt/a of
magnetite concentrate. A further 1.5 Mt/a hematite will
be mined and exported by Mt Gibson Mining, which has
rights to all hematite mineralisation within the tenement.
The magnetite concentrate will be shipped from the Port
of Geraldton direct to a new 2.5 Mt/a pellet plant at the
port of Longtan, Nanjing, Jiangsu Province, China. The
project is currently being assessed through a Bankable
Feasibility Study, due for completion in December 2005.
Environmental assessment of the project is underway and
site construction is scheduled to commence early-mid
2006, and commissioning of the magnetite concentrator
mid 2007.
Expenditure: $620m.
Mid West Region - Koolanooka Iron Concentrate/
Pellet Project
MIDWEST CORPORATION LIMITED
Midwest Corporation proposes to develop an iron ore
mining operation at the Koolanooka magnetite iron ore
deposit, 160 km south-east of Geraldton, to produce 4.5
38
Prospect
Mt/a magnetite concentrate and/or pellets. The project
is expected to include gas and water pipelines and a
dedicated 120 MW gas-fired power plant. A scoping
study is currently underway and is due to be completed
in December 2005. The company anticipates production
will commence in 2010/2012, following the completion of
successful pre-feasibility and bankable feasibility studies.
Expenditure: $1b.
Mid West Region - Koolanooka/Blue Hills Hematite
Iron Ore Mine
Midwest Corporation proposes to re-open the Koolanooka
and Blue Hills hematite iron ore mines about 160 km
south-east of Geraldton, near Morawa, at an initial rate
of 1 Mt/a. The company plans to initially ship the fines
stockpiles, commencing in December 2005, before
starting hard rock mining at Koolanooka in mid-2007 and
at Blue Hills in 2008. Midwest Corporation will transport
the ore by road from the Koolanooka minesite to the
Port of Geraldton. The NOI for the shipping of the fines
stockpile has been submitted.
Expenditure: $26.4m.
be serviced by a multi-user railway and new port facilities
at Port Hedland. Stage A of the project which consists of
the north-south railway and port facilities has received
environmental approval. Stage B - the east-west railway
and the mine developments - and a separate mining
proposal at Cloudbreak are currently being assessed
by the EPA. A detailed feasibility study of the mining
operations is in preparation for completion in late 2005.
Construction on the rail and port facilities is planned to
start in mid 2006 to supply the Chinese market from early
2008.
Expenditure: $2.4b.
Further to Rapid Growth Projects (“RGP”) 1, 2 and 3,
BHP Billiton proposes to expand the production capacity
of its Pilbara iron ore operations to nominally 152 Mt/a,
subject to Board and Government approvals. RGP4, which
is focussed on expanding the Newman operations, is
currently in the feasibility stage.
Expenditure: $1.8b.
IRON ORE PROCESSING
Mid West Region - Weld Range Iron Ore Mine
Fortescue (Cape Preston) - Mine and Pellet Plant
Midwest Corporation proposes to develop a 15-20
Mt/a iron ore mine at Weld Range 65 km south-west of
Meekatharra, producing a mix of hematite lump, fines and
possibly concentrate. The project is expected to include
a new standard gauge 350 km rail line and a new deep
water port facility near Geraldton. A go-ahead for the
project is dependent on commercial and market factors.
The company is to conduct an extensive drilling program
late 2005/early 2006 with a pre-feasibility study to be
completed mid 2006 and project start-up aimed for 2010.
Expenditure: $800m.
MINERALOGY PTY LTD
The first project based on the Fortescue magnetite
deposit is expected to be a 7 Mt/a pellet plant. The
project involves mining, concentrating through magnetic
separation, pelletising and export through new port
facilities at Cape Preston. Mineralogy has entered into
a number of Memorandums of Understanding with
Chinese companies which could see a number of projects
producing concentrate, pellets and DRI developed.
Environmental approval has been granted.
Expenditure: $1.4b.
Midwest Region - Blue Hills Iron Ore Project
GINDALBIE METALS LIMITED
Gindalbie Metals proposes to develop a direct shipping
hematite ore project of 1.5 Mt/a at Blue Hills, 220 km
south-east of Geraldton. The company is currently drilling
to define a JORC-compliant resource and expects that
drilling will be completed by March 2006 and that mining
will commence in early 2007. Gindalbie is currently
investigating the option of transporting the ore by train or
truck to the Port of Geraldton for export.
Expenditure: $20m.
Midwest Region, Blue Hills North - Mt Karara
Magnetite Mine and Pellet Project
GINDALBIE METALS LIMITED
Gindalbie Metals is progressing a pre-feasibility study
for the development of a magnetite mine at its Mt
Karara deposit in the Blue Hills North Project, 220 km
east-south-east of Geraldton. The company believes
the deposit has the potential for a resource in excess
of 400 million tonnes, to support a 4 Mt/a pellet project
for at least 20 years. A scoping study was completed
in February 2005, which proposed that the magnetite
concentrate will be transported to Narngulu, near
Geraldton, via slurry pipeline and pelletised prior to
shipping. Gindalbie are undertaking extensive flora and
fauna studies in conjunction with CALM and is continuing
negotiations with traditional owners. Gindalbie anticipates
that commissioning and shipping would occur in 2009.
Expenditure: $720m.
Pilbara - Iron Ore Mine
IRON ORE HOLDINGS
Iron Ore Holdings completed a scoping study in July
2005 on its three projects (Yandicoogina Creek, Lamb
Creek and North Marillana) located in the Pilbara, 275
km south of Port Hedland. The study was based on the
road transport of 2 Mt/a pisolitic ore, which is expected
to be shipped from Port Hedland. Stage 1 geological
investigations of the projects were completed in
September 2005 and identified an additional 16 exposed
channel iron deposit targets on the tenements. Iron Ore
Holdings expects to commence resource drilling of the
projects in Q4 2005.
Pilbara - Iron Ore Mine Rail and Port Development
FORTESCUE METALS GROUP (FMG)
FMG is proposing to develop new iron ore mines in the
Chichester Ranges of the eastern Pilbara. The mines will
MANGANESE
Goldfields - Manganese Dioxide Project
HITEC ENERGY LIMITED
HiTec Energy proposes to produce electrolytic manganese
dioxide (“EMD)
for alkaline batteries. The hydrometallurgical plant will
be a brownfields development at Cawse, 55 km northwest of Kalgoorlie, built around an
existing electro-winning cell house and SX plant,
acquired by HiTec in October 2003. The initial production
stage of up to 23,000 t/a is expected to take 12 months
to construct. Manganese ore will be sourced from
Consolidated Minerals’ Woodie Woodie mine in the
Pilbara, as well as manganese waste from OMG’s Cawse
nickel plant.
Expenditure: $136m.
MOLYBDENUM
Pilbara - Spinifex Ridge Mo/Cu mine
MOLY MINES LIMITED
The Spinifex Ridge Mo/Cu deposit is located 50 km
north-east of Marble Bar in the Pilbara region of Western
Australia. Moly Mines has commenced a Definitive
Feasibility Study (“DFS”) at Spinifex Ridge and is targeting
a decision on project development by mid 2006. A prefeasibility study is expected to be completed by the end of
2005. A positive DFS outcome would result in Australia’s
first major entry into the 200,000 tonne per year global
molybdenum market.
NICKEL
Goongarrie - Kalgoorlie Nickel Project - Mine
(laterite ore) and Hydrometallurgical Processing
Plant HERON RESOURCES LTD
A detailed pre-feasibility study is continuing for the
development of a 50,000 t/a mine and hydrometallurgical
processing plant at Goongarrie some 85 km north of
Kalgoorlie-Boulder. The project will be based on the
company’s laterite nickel resources of 903 Mt grading
0.74% Ni and 0.05% Co. The dominantly siliceous
component of the resource, being some 460 Mt grading at
0.70% Ni and 0.05% Co, is considered to be amenable to
beneficiation by low cost screening to a leach feed grade
target of 1.5% Ni. Heron and Inco have signed a formal
agreement under which they will develop the project.
Expenditure: $1.4b.
North Eastern Goldfields - Yakabindie Nickel Mine
BHP BILLITON NICKEL
The Yakabindie project is based on a large nickel deposit
situated near BHP Billiton’s existing Mt Keith nickel
project and is estimated to contain a resource of 289 Mt
grading 0.58% nickel. BHPB is considering developing
Yakabindie as an integrated part of the Mt Keith project,
and is conducting a pre-feasibility study, including infill
drilling of the ore body and metallurgical testing.
Expenditure: $20m.
Pilbara - Nickel Mine
SHERLOCK BAY NICKEL COMPANY
Sherlock Bay Nickel Corporation (“SBNC”) is currently
investigating the feasibility of the Sherlock Bay nickel
project, 100 km east of Karratha. SBNC intends to
develop an approximately 9000 t/a nickel project based on
the Bioheap ore treatment process, licensed from Pacific
Ore Technologies. The company is undertaking a major
review of the project to take into account more recent
resource estimates and to confirm the results of prior
metallurgical testing.
Expenditure: $30m.
OIL & GAS DEVELOPMENTS
Angel (Carnarvon Offshore Basin) - Gas Field
WOODSIDE ENERGY LTD
The Angel gas and condensate field, operated by
Woodside as part of the North West Shelf Venture
(“NWSV”), will be developed to meet NWSV gas customer
demand. The development includes the NWSV’s third
fixed platform, which will be remotely operated, three
subsea wells and a 49 km pipeline to join an existing
offshore trunkline to shore. A final investment decision on
the project is expected in December 2005, with production
planned for Q4 2008. The platform will be capable of
processing 800 million standard cubic feet of gas a day.
Expenditure: $1.6b.
Gorgon (Carnarvon Offshore Basin) - Gas and
Condensate Field
CHEVRONTEXACO AUSTRALIA PTY LTD
The Gorgon Joint Venture is considering an LNG (up
to 10 Mt/a) and domestic gas development at Barrow
Island, based on gas from the Gorgon and Jansz fields.
The restricted industrial use of Barrow Island has been
approved, in principle, by the Western Australian Cabinet
after evaluation of environmental, social, economic and
strategic aspects. Development decisions by the Gorgon
Joint Venturers will be subject to market commitments.
The joint venture has applied for environmental approvals
so it is in a position to start construction in late 2006.
Expenditure: $11b.
Macedon (Carnarvon Offshore Basin) - Gas Field
BHP BILLITON PETROLEUM PTY LTD
The Macedon gas field, located about 50 km north of
Exmouth, was discovered in 1992 by the West Muiron-3
well, with a follow-up appraisal campaign in 1994. BHP
Billiton is continuing to investigate domestic market
opportunities for Macedon, which is estimated to contain
a gas resource of up to 1.2 Tcf. Gas recovered to date is
dry, containing no condensate or LPG.
Onslow - LNG Plant
BHP BILLITON PETROLEUM
BHP Billiton Petroleum (BHPB) is conducting a prefeasibility study into the development of the Scarborough
gas resource located 280 km northwest of Onslow, and
an associated 6 Mt/a LNG plant at a site approximately
4.5 km southwest of Onslow. BHPB will be the owner and
operator of the LNG plant. It is intended that the bulk
of the LNG produced will supply the United States west
coast and Asian energy markets. The Pilbara LNG Project
sanction is expected by Q1 2007 and construction is
scheduled to commence during Q2 2007. LNG production
is anticipated by early 2011.
Expenditure: $4b.
Pyrenees Development (Carnarvon Offshore Basin)
- Oil Fields
The proposed Pyrenees Development is located 45 km
north-west of Exmouth in approximately 200 metres of
water. The project is in the feasibility stage. The Pyrenees
development area was discovered in July 2003 when the
Ravensworth-1 well encountered a 29.4 metre net column
of oil, while the Crosby-1 well encountered a 43.5 metre
net column of oil. Additional appraisal wells drilled in May
and June 2004 gave more information on the potential
volume of the field. The preferred development concept is
a FPSO vessel connected to subsea wells and flowlines.
The FPSO will have a design capacity of 80,000 bbl/d of
liquids. The field life is estimated to be 20 years.
Scarborough (Carnarvon Offshore Basin) - Gas Field
EXXON MOBIL
The field is located in 900 metres of water, 300 km
offshore in the Carnarvon Basin with probable reserves
of approximately 8 Tcf of gas. BHP Billiton Petroleum
(BHPB) completed 3D seismic survey work in May
2004 and drilling of Scarborough-3, 4 and 5 wells were
completed in the period December 2004 to February
2005. Evaluation of the data is in progress. BHPB is also
conducting a pre-feasibility study to assess the viability
of providing Scarborough gas to its proposed Pilbara LNG
plant near Onslow.
Scott Reef/Brecknock (Browse Basin) - Gas Fields
WOODSIDE ENERGY LTD
The current estimated contingent resources for the
Browse gas fields exceed 20 Tcf of gas and 300 million
barrels of condensate. Further drilling is currently taking
place with three wells, Brecknock-2 (completed early
October 2005. Brecknock-2 intersected a 151m gross gas
column), Calliance-1 (spudded mid-October, 2005) and
Brecknock-3 (scheduled for early 2006). Over the next
two years, Woodside (Operator and ~ 50% stakeholder)
is planning further appraisal of the gas resources
and finalising concept feasibility studies for an LNG
production facility capable of supporting 7-14 million
tonnes of LNG annually. The current target for a possible
start up is 2011 to 2014, depending on the outcome of
the development studies, the gaining of approvals and
securing customers.
Stybarrow (Carnarvon Offshore Basin) - Oil Field
The Stybarrow field is located in a water depth of
approximately 800 metres and is approximately 65 km
north-west of Exmouth. The Stybarrow oil discovery
was made in February 2003 when the Stybarrow-1 well
encountered a gross oil column of 23 metres with 18.6
metres of net pay in the Macedon member sandstone
reservoir. The preferred development concept is a FPSO
vessel connected to subsea wells and flowlines. The
FPSO will be able to process approximately 80,000 bbl/d
of liquids. The Stybarrow oil field and adjacent small oil
rim of the Eskdale oil and gas field have recoverable oil
reserves estimated in a range from 63-95 million barrels
of oil (“MMbbl”), comprising of 60-90 MMbbl at Stybarrow
and 3-5 MMbbl at Eskdale. The estimated economic field
life is 10 years.
Tern/Petrel (Bonaparte Offshore Basin) - Gas Fields
SANTOS LIMITED
The offshore Petrel gas field, discovered in 1969, is
located about 250 km west of Darwin on the WA/NT
seabed border in the Bonaparte Basin. The offshore Tern
gas field, discovered in 1971, is located about 300 km west
of Darwin in WA waters in the Bonaparte Basin. Field
development options include installation of unmanned
offshore production platforms with a pipeline to a gas
treatment plant south of Darwin. The development
possibilities for these fields have been enhanced by
recent significant discoveries by other parties nearby,
which may provide tie-in potential for Petrel and Tern
to service domestic gas customers. A conceptual plan
involves initial development of Petrel with a pipeline
to an onshore gas plant and a subsequent phase that
completes Petrel and develops Tern.
Expenditure: $1b.
PLATINUM GROUP METALS
Pilbara - Platinum Deposit
HELIX RESOURCES NL
Helix Resources NL has established an indicated resource
of 9.2 Mt at 2.9 g/t combined platinum, palladium,
rhodium, and gold, 0.2% nickel, and 0.3% copper at its
project site near Karratha. Preliminary mining studies
suggested a mining rate of combined open cut and
underground production of 1.5 Mt/a. Further activity was
postponed in early 2003, as a result of poor exploration
results and a decreased palladium price. The project is
under review.
RARE EARTHS
Mt Weld - Rare Earths Operations
LYNAS CORPORATION LTD
Lynas is planning to mine up to 200,000 t/a ore, producing
45,000 t/a of concentrate which is equivalent to 15,000
t/a rare earths oxides. During the March 2005 quarter
Lynas completed a feasibility study, with capital costs for
development put at $49.2 million for an open pit mine and
two processing plants in China. A development decision
on the project is expected by early 2006, with production
expected to begin within 12 months from the decision.
Expenditure: $49m.
SALT
Exmouth Gulf - Yannarie Solar Salt Project
STRAITS SALT PTY LTD
Straits Salt Pty Ltd is currently investigating the
feasibility of producing up to 10 Mt/a of salt in the
eastern Exmouth Gulf area, 1100 km north of Perth. It
has exploration licences over the area of interest while it
undertakes its feasibility studies. Straits has submitted
its Environmental Review and Management Program to
the EPA and is in discussions with government regarding
appropriate tenure and associated matters.
Expenditure: $120m.
TIMBER
Mirambeena - Engineered Strand Lumber
LIGNOR PTY LTD
Lignor Pty Ltd is proposing the development of an
engineered strand lumber plant located at Mirambeena,
near Albany. The plant will source most of its timber from
the extensive eucalypt plantations growing in the Albany
region and will use technology developed by the German
engineering company, Siempelkamp. The company has
raised $5 million to complete its feasibility study. The
study should be completed by the middle of 2006 and
construction commenced by late 2006 with the plant
being fully operational by late 2008.
Expenditure: $200m.
VANADIUM
Pilbara - Balla Balla Vanadium/Ferroalloys Project
RENEWABLE ENERGY CORPORATION LIMITED
Aurox has commenced late stage development work
on the Balla Balla ferroalloy project located mid-way
between the regional centres of Karratha and Port
Hedland. Granted mining leases enclose a resource
estimated to be 110 Mt grading 0.76% V2O5, with the
project being within close proximity to key infrastructure
including a natural gas pipeline and grid power. The
layered intrusion at Balla Balla also contains significant
concentrations of apatite, a source of phosphate for the
production of phosphoric acid and fertilizer. As well,
the 16 kilometre titanomagnetite horizon has potential
as a superior value-in-use iron making product. The
completion of a Bankable Feasibility Study into the
production of ferrovanadium is scheduled early in 2006
with operations to commence at the end of 2007.
Windimurra - Vanadium Pentoxide mine and
processing plant
PRECIOUS METALS AUSTRALIA LIMITED
Windimurra is located approximately 80 km from Mount
Magnet. It is one of the largest proven vanadium bodies
in the world, with JORC measured resource at 77 million
tonnes grading 0.5% vanadium pentoxide and a further
indicated resource of 32 million tonnes grading 0.47%
vanadium pentoxide. PMA is conducting a feasibility study
to assess re-developing the project and also producing
5000 t/a ferrovanadium. It is expected that the study will
be completed in early 2006 when a decision on the future
of the project will be made.
Expenditure: $120m.
ZINC/COPPER
North Eastern Goldfields - Jaguar - Base Metals
Mine
JABIRU METALS LTD
A recently updated and optimised Bankable Feasible
Study for Jabiru Metals’ Jaguar base metals prospect, 54
km north of Leonora, has been completed. The project is
forecast to produce 20-25,000 t/a of zinc in concentrate,
8-10,000 t/a copper in concentrate and 800,000 oz/a of
silver in concentrate over a 5 year mine life, based on a
milling rate of 365,000 t/a. It is planned to develop an
underground mine, with a possible start-up date of early
2007.
Expenditure: $56m.
39
Prospect
Major Resource Development Projects: Western Australia
As at Dec 2005
INSET B
INSET C
MutineerO
Exeter O
Eaglehawk Egret !Hermes
Searipple
! Lambert
Capella u u
OO
u Angel
! Cossack
Perseus u uNorth
Gaea/
Wanaea
!
Dockrell Ishmael u Rankin
! Legendre North
Keast uu Goodwyn
!Legendre South
Echo/Yodel u u
Goodwyn South/Pueblo ??Tidepole
Io/Janszu
Urania N
Burrup Peninsula
N Rankin/u ?Dixon/West Dixon
Wheatstone
Jansz N
Sculptor
u
@ Ammonia
Eurytion N Geryon N N Iago/N Tryal Rocks Reindeer N
Pluto
@ Ammonia-urea
u Wilcox
Caribouu
@ Ammonium Nitrate
CorvusN
Maenad N N Orthrus
Wandoo !
6 Desalination
uChrysaor/Dionysus
@ LNG
u West Tryal Rocks
O Stag
John Brookes N SEE INSET C
Gorgon u
Spar N
N Kelp Deep
Laminaria East
A
! O Jahal
O Buffalo
Chudditch N
! Bayu-Undan
O Jabiru
O Challis/Cassini
N Petrel
N Crux
Cape Lambert
N Tern
Dampier salt s
Karratha
Woollybutt O
N Brewster
N Scott Reef
n Radio Hill
Z Whundo Cu Zn
K Munni Munni
I Fortescue
N Brecknock
N Brecknock South
Blacktip N
u Ichthys
Turtle O
b Mitchell Plateau
rN
at u
ra
l
Ga
sP
ipe
lin
e
Ord Stage 2-M2
Wyndhamq
6
6
Ord Stage 2-Mantinea Flats
6
Ord Stage 1
Lake Argyle Hydro 6
Koolan Island
Cockatoo Island I I
I Middle Robe Mesas
I Robe Mesa J
KIMBERLEY
I Bungaroo Creek
Pe
rth
-
Da
mp
ie
I
Robe
Mesa A
N Point Torment
Lloyd
Boundary
OO
West Terrace
Sundown O d Ellendale
Blina
Argyle d
Derby q
s Exmouth Gulf
O Rough Range
B
C
Parker Point
q
q Dampier
East Spar N
Chinook/Scindian
Coniston O
Griffin O !
O Novara
Taunton ! ! South Chervil
Eskdale O
Skiddaw Enfield
Vincent
Yammaderry ! Crest
Stybarrow OOO O Ravensworth/Crosby
! Saladin
Laverda ! NNO! Pyrenees
Cowle !! Skate
!
N
q
Scafell
Macedon Coaster O ! Roller Onslow
@s
Stickle
Pilbara LNG
N
Tubridgi
Sunrise N
Troubador N
Campbell u
Endymionu
/Sinbad
?
NDoric/Ulidia
Bambra N
N Linda
Harriet/Gudrun O Lee N Monty
Rose
uu
Varanus Island
North Alkimos!
Agincourt ! ! Gipsy !u Josephine
Monet/Simpson O S.Plato
Sandy/Pedirka/North Pedirka/
/Tanami O ! Little
N Hoover Victoria
O @ Double island
Barrow Gorgon
Island
Barrow Island
PuffinO
Skua O
Wonnich
Manyingee
,
0
Homestead I
Silvergrass I
Nammuldi I
Brockman 2 I
Brockman 4 I
j Paulsens
100
Broome
q
Sally Malay n
n Copernicus
Panton Sill K
Z Pillara Zn Pb
Z Kapok Zn Pb
200 km
RESOURCE SYMBOLS
SEE INSET B
Port Hedland
Scarborough N
q s Port Hedland Salt
Salt Creek V Balla Balla
Zn Pb Z
Yarrie I
n Sherlock Bay
Z Whim Creek Cu
j Indee
Wodgina t
Z Sulphur Springs Zn Cu
PILBARA
Woodie Woodie r Z
Nifty Cu
j Telfer Au Cu
Golden Eagle j
r Ant Hill
Z
Cloud Break I
Maroochydore Cu Co
I Christmas Creek
, Kintyre
Marandoo IWestern 4 Yandi/BHPB
I Mt Nicholas
II Yandicoogina/HI
Tom Price I
Beasley River I
I IMindy Mindy
Mining Area C I I
Hope Downs I Rhodes Ridge
Paraburdoo IWest Angelas I
I East Angelas
23, 25 & 18
Eastern Range I
Giles Mini I
I I Orebody
Channar I
I Jimblebar
Mt Whaleback
c Coobina
q x Lake MacLeod
s Lake MacLeod
Carnarvon
Plutonic j
Fortnum j
Horseshoe Southr
Jack Hills I
j Jundee/Nimary
Magellan Pb Z
Bluebird–Meekatharra Gabinthia
Wiluna
j V Wiluna WestI jjWilliamson
Weld Range I
Honeymoon Well n ,Lake Way
n
j
,Lake Maitland
Burnakura ,Nowthanna ,Yeelirrie
Gidgee j n Mt Keith
Yakabindie n j Bronzewing/Mt McClure
Cosmos n Waterloo
Leinster
Sandstone Plant Agnew n n j Darlot
j
,Thatcher
Port Gregory
Hill 50 j
Thunderbox
j
Lawlers j
Soak
I Tallering Peak
G
p j Marshall Pool
j
np
Sickle
V Lords Henry & Nelson
Windimurra Jaguar Zn Cu Z
j j Brightstar
Whisper
Kirkalocka
Oakajee
jGullewa Au Cu j
Tarmoola j
q Narngulu Synthetic
pn j
Z Golden Grove Zn Cu
P Mt Weld
jGossan Hill Ag Au
Geraldtonq J Rutile
Minjarj
R
Sons of Gwalia jMurrin j
Mt Mulgine
Alinta Wind farm8 Mount Horner
j Sunrise Dam
Murrin
j
I Blue Hills
Granny Smith –Wallaby
Yardarino N u
Koolanooka
I
j Red October
Dongara OOHovea–Eremia
Xyris
IKoolanooka
South
O
Cliff Head OOmu
D Apium
TThree Springs I Mt Gibson
Jingemia NOu ongara
HM
Mulga Rock ,
Beharra Springs/
Davyhurst j
j
jSand George
Eneabba
m
u
North Beharra
Mt Gibson Windarling Range I
n Goongarrie
Woodada
Springs Tarantula hCentral West
j Carosue Dam
Paddington
Mt Jackson I
Cawse n
EMD/HiTec y n Black SwanBelle – Red Hill
8 Emu Downs Wind Farm
Mt Pleasant j j jjKanowna
Bulong
vnAvalon Plant
Koolyanobbing I
Cooljarloo m
Kundana jj jSuper
Pit
m Cataby
Frogs Leg v Kalgoorlie
Ni Smelter
Coolgardie-Redemption j
n Blair-Area57
SEE INSET A
j
Mt
Marion
n Carnilya
Westonia j
Long–Victor nnKambalda Concentrator
Nepean n n n Beta-Hunt
Marvel Loch j j
Spargoville n j St Ives
Yilgarn Star
Armstrong
n t Bald Hill
Miitel–Redross n Lanfranchi
•
Shark Bay qs
m Coburn
INSET A
Kwinana/Rockingham
0
50km
q AIS Jetty
a Alumina Refinery
m Gingin
@ BP Oil Refinery
C Cement and Lime
Chandala
J Synthetic
@ Chlor Alkali
Rutile
Chemicals
Neerabup
@
1
6 Desalination
Malaga Brick
@ Fertilizers
Middle Swan Brick
Midland Brick
@ Fused Alumina
• PERTH
@ Fused Zirconia
Caversham Tile
Y HIsmelt
q Fremantle
@ LPG
Armadale Brick
v Nickel Refinery
Cardup Brick
8 Power Station
@ Sodium Cyanide
m Keysbrook
J Titanium Pigment
@ Zirconia
Pinjarra
a8
a b Huntly
j
Pinjarra Gallium
Boddington Au Cu
m Waroona
b
aWagerup
Kemerton
Saddleback
@ Chlor Alkali
Kemerton
w
Silicon
Smelter
X
8
Worsley
a 8 Bluewaters
J Titanium
J Australind
Collie
Pigment
q Bunbury h 8 Premier
Ewington
h
m
Dardanup 1 Dardanup
Muja
8
Capel Synthetic Rutile J m Gwindinup
Ludlow mmYoganup West
Tutunup m m
Yoganup
h
Leeuwin - Naturaliste CBM
NWhicher Range t Greenbushes
Bauxite-Alumina
a Alumina refineries
b Mines and deposits
Coyote
Chemicals / Petrochemicals / Petroleum
j
@ Processing plants / refineries
N Natural gas field
O Oil field
! Natural gas / oil field
u Natural gas / condensate field
? Natural gas / oil / condensate field
Chromite
c Mines and deposits
Clays
Brick / tile procesing plants
Coal
h Coal/coal bed methane (CBM) mines and deposits
? Lignite mines and deposits
Copper-Lead-Zinc
Z Mines and deposits
Diamonds
d Mines and deposits
Gold
j Mines and deposits
Gypsum
x Mines and deposits
Heavy mineral sands
m Mines and deposits — titanium-bearing sands
G Mines and deposits — garnet-bearing sands
J Ti02 pigment and synthetic rutile plants
Iron ore
I Mines and deposits
Y Downstream processing plants
Limestone-Limesand
4 Mines and Deposits
C Cement plants
Magnesite
p Mines and Deposits
Manganese ore
r Mines and deposits
y Downstream processing plants
Wingellina
Nickel
n
n Mines and deposits
n
West Musgrave
v Smelters and refineries
Phosphate
P Mines and deposits
Platinoids
K Mines and deposits
Rare earth elements
R Mines and deposits
Salt
s Production facilities / pans
Silica - Silica Sand
w Mines and deposits
X Silicon smelters
Talc
T Mines and deposits
Tantalum
t Mines and deposits
Uranium
, Mines and deposits
Vanadium-Titanium
V Mines and deposits
NON-MINERAL PROJECTS
6 Irrigation/water schemes
q Major port handling facilities
8 Major power stations
1 Downstream timber processsing plant
Gas pipeline
Proposed gas pipeline
OPERATING PROJECTS ARE SHOWN IN BLUE
POTENTIAL PROJECTS ARE SHOWN IN RED
PROJECTS ON CARE AND MAINTENANCE ARE
SHOWN IN PURPLE
PERTH
Emily Ann – Maggie Hays n
j Central Norseman
n Forrestania
O'Sullivans ?
? Scaddan
Western
Australia
Phillips River h n Ravensthorpe
q8
Esperance
1 Manjiump
m Jangardup South
Mirambeena 1
q
I Southdown
Albany
0
100
200
300
400
km
A Bright Future
Planned for Investors in Victoria Petroleum N.L.
Victoria Petroleum N.L. plan to increase oil & gas production
net revenue by 215% in 2006 after 275% increase in 2005.
Participant in onshore North Perth Basin Jingemia Oil Field
production tested at 4,800 barrels of oil per day in 2005, Mirage
and Ventura Oil Field 2004 discoveries and Flour Bluff Gas Field
Development Project, Texas, USA
4Drilling major Californian Eagle Oil Pool well in December 2005
targeting 34 million barrels of oil and 58 BCFG
4Planned drilling in early 2006 of 16 million barrel oil potential
Tomcat Prospect as first well in six well exploration drilling
program in Cooper Basin South Australia
4Initial successful 2005 development drilling of 200 BCF gas
potential Flour Bluff Gas Field, Texas producing 5 million cubic
feet per day gas equivalent
4Successful development well at Jingemia-10 resulted in
increase of Jingemia Oil Field production to 5,200 barrels of oil
per day in November 2005
4Mirage and Ventura oil discoveries in South Australian Cooper
Basin on stream at gross 400 barrels of oil per day in
November 2005
4Largest exploration acreage holder in South Australia and
Queensland Cooper/Eromanga Basin with average 40% interest
4Targeting Australia and USA 2006 est. net oil production of 600
barrels of oil per day and $12 million net revenue with 12 wells
planned in next six months
DHA-VP-662

PETROLEUM BONANZA WA gas becomes a premium fuel GAS TO

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