WESTERN AUSTRALIA’S INTERNATIONAL RESOURCES DEVELOPMENT MAGAZINE June–August 2006 $3 (inc GST)
WA PORTS Vital infrastructure for Western Australia’s commodity exports LNG Keen interest in Browse Basin gas GOLD Major new development plans for Boddington IRON ORE Hope Downs project enters the fast lane Print post approved PP 665002/00062 approved Print post Jim Limerick 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 INTERNATIONAL OFFICES Europe European Office • 5th floor, Australia Centre From the Director General Corner of Strand and Melbourne Place London WC2B 4LG • UNITED KINGDOM Tel: +44 20 7240 2881 • Fax: +44 20 7240 6637 Email: [email protected] Overseas trade and investment India — Mumbai In a rare get together, key people who facilitate business via the Western Australian Western Australian Trade Office 93 Jolly Maker Chambers No 2 Government’s overseas trade offices gathered in Perth recently to discuss ways to 9th floor, Nariman Point • Mumbai 400 021 INDIA maximise services for local and international businesses. Tel: +91 22 5630 3973/74/78 • Fax: +91 22 5630 3977 Email: [email protected] All of the Western Australian Government’s 14 overseas offices, with the exception of India — Chennai the USA, were represented by their regional directors. Western Australian Trade Office - Advisory Office 1 Doshi Regency • 876 Poonamallee High Road Kilpauk • Chennai 600 084 • INDIA The event was a huge success with delegates returning home with fresh ideas on how Tel: +91 44 2640 0407 • Fax: +91 44 2643 0064 to overcome impediments and develop and promote trade in, and investment from, their Email: [email protected] respective regions. Indonesia — Jakarta Western Australia Trade Office JI H R Rasuna Said Kav C15 - 16, Kuningan Western Australia is Australia’s largest export State, accounting for about one-third of Jakarta 12940 • INDONESIA the nation’s total exports. Tel: +62 21 5290 2860 • Fax: +62 21 5296 2722 Email: [email protected] While resource commodities dominate the State’s exports, other growth areas for 2006 Japan — Tokyo will include information communications and technology, which is expected to grow by Government of Western Australia, Tokyo Office 13th floor, Fukoku Seimei Building 4.3 per cent, mining services 4 per cent, tourism 3.5 per cent and environmental and 2-2-2 Uchisaiwai-cho Chyoda • TOKYO 100-0011 JAPAN defence industries each 3.3 per cent. Tel: +81 3 5157 8281 • Fax: +81 3 5157 8286 Email: [email protected] Japan — Kobe Our trade representatives in these and other countries are skilled professionals who Western Australian Government Office can assist with aspects of market intelligence and business matching. 6th floor, Golden Sun Building • 3-6 Nakayamate-dori 4-Chome Chuo-Ku • Kobe 650-0004 JAPAN Details of how to contact these people can be found on the right-hand side of this page. Tel: +81 78 242 7705 • Fax: +81 78 242 7707 Email: [email protected] Malaysia — Kuala Lumpar Western Australian Trade Office 4th floor, UBN Tower • 10 Jalan P Ramlee KUALA LUMPUR 50250 MALAYSIA Tel: +60 3 2031 8175/6 • Fax: +60 3 2031 8177 Email: [email protected] 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 Email: [email protected] People’s Republic of China — Hangzhou Western Australian Trade & Investment Promotion Key people fostering WA trade in overseas markets: Front row (from left to right) Simon Johnson – Regional Director, India, Hangzhou Representative Office Jim Limerick –Director General, DoIR, Gary Stokes –Deputy Director General, Office of State Development, DoIR Second row Room 910 • World Trade Office Plaza (from left to right) Richard Muirhead – Chief Executive Officer, Tourism WA, Verghese Jacob – Regional Director, Malaysia, Noel Zhejiang World Trade Centre Ashcroft – Agent General, London (Europe office), Chris Heysen – Regional Director, United Arab Emirates Third row (from left to 15 Shuguang Road • Hangzhou 310007 right) BJ Zhuang – Regional Director, China , Sherry Lin – Senior Consultant Western Australian Trade Development, Hong Kong, PEOPLE’S REPUBLIC OF CHINA Pankaj Savara – Regional Marketing Manager, United Arab Emirates, Siraphop Apilertvorakorn – WA Business Development Tel: +86 571 8795 0296 • Fax: +86 571 8795 0295 Manager, Thailand, Colin Slattery – General Manager, Market Development, International Market Development Division, DoIR Email: [email protected] Fourth row (from left to right) Young Yu – Regional Director, South Korea, Craig Peacock – Official Representative, North Asia, Martin Newbery – Regional Director, Indonesia, Brian Carew-Hopkins – Director, International Market Development Division, South Korea — Seoul DoIR, Nicholas Mackay – Senior Manager Western Australia, Taiwan Western Australian Trade & Investment Office 11th floor, Kyobo Building 1 Jongro 1-Ga, Jongro-Gu Seoul, SOUTH KOREA Prospect Cover photo: A heavily laden iron ore carrier exits Port Tel: +82 2 722 1217 • Fax: +82 2 722 1218 Western Australian Prospect magazine is published quarterly Hedland, which is currently Australia’s largest tonnage port. Email: [email protected] by the Western Australian Government’s Department of Industry and Resources (DoIR) and Ray Burns Media. Taiwan — Taipei Photo courtesy of BHP Billiton Iron Ore. WA Business Development Manager Editorial management: John Terrell, DoIR Communications Australian Commerce & Industry Office and Marketing. Tel: (08) 9222 3804 • Fax: (08) 9222 3069 Email: [email protected] Suite 2606, International Trade Building Advertising management: Ray Burns Media, #333 Keelung Road Section 1 • Taipei 110 TAIWAN PO Box 1230, South Perth Western Australia 6951 Tel: +886 2 8780 9118 ext 216 • Fax: +886 2 2757 6707 Tel: (08) 9227 6688 • Mobile: 0408 474 328 Email: [email protected] Email: [email protected] Thailand — Bangkok Disclaimer WA Business Development Manager Prospect has been compiled in good faith by the Departmentof Industry Department of Australian Trade Commission • Australian Embassy and Resources. Opinions expressed in Prospect are those of the authors and do not necessarily represent the views, or have the endorsement of Industry and Resources 37 South Sathorn Road • Bangkok 10120 • THAILAND the Department of Industry and Resources. The Department of Industry Tel: +662 344 6337 • Fax: +662 344 6360 and Resources has used all reasonable endeavours to ensure the material Email: [email protected] contained in this publication is correct, but it is intended to be general in www.doir.wa.gov.au nature. No representation is made with regard to the completeness or United States — Los Angeles accuracy of the information contained herein. The Department of Industry Western Australian Trade and & Investment Office and Resources disclaims any or all liability for loss or damage whatsoever suffered or incurred resulting from the use of or reliance on information Howard Hughes Centre, 6080 Centre Drive, 6th Floor contained herein. Readers of this publication should make and rely Los Angeles, CA 90045 USA on their own enquiries, research and judgements in making decisions affecting their own or any other person’s interest. Tel: +1 310 216 2827 • Fax: +1 310 216 5632 Email: [email protected] 2 Gold — A go-ahead is given for the $1.8 billion to $2 billion deep development of the Boddington gold mine.
3 LNG — First supplies of Western Australian liquefied natural gas arrive in China.
4 Ethanol — Australia’s first wheat-based ethanol plant, worth about $100 million, could be operating at Kwinana by early 2008.
5 Gas — Renewed interest in monetising the vast offshore gas resources of the Browse Basin.
6 - 16 WA PORTS FEATURE
20 Iron ore — Fast-track plans for the $1.5 billion Hope Downs iron ore project.
22 Mine safety — Worldwide interest in Western Australian-designed and built underground mine rescue chambers.
24 Oil receival facility — Roc Oil links up with Kwinana oil refinery to offload crude oil from its Cliff Head oil field.
25 Record year — Western Australia’s mineral and petroleum output hits a new record of $38.9 billion in 2005.
PORTS — key infrastructure for resources This edition of Prospect takes a look at port infrastructure and its vital link to resources development in Western Australia. Boddington bubbles with excitement
By John Terrell
Department of Industry and Resources
An air of excitement has enveloped the South West town of Boddington since a commitment was given in late February to develop the deeper ore bodies of the Boddington gold mine.
The CEO of the Shire of Boddington, Peter Bradbrook, said local business confidence had risen sharply, and the council was hiring new staff to cope with new housing and infrastructure requirements.
“It is definitely an exciting new time in the history of Boddington,” Mr Bradbrook said.
“We saw the local hardware shop double in size in anticipation of a go-ahead announcement. Applications have been received to establish a pharmacy in Boddington, a new crane hire business has started up, while numerous other commercial queries have also been Going deeper: The Boddington open cut, from which 4.7 million ounces of gold and 6572 tonnes of copper have so far been received.” produced. The deep mining phase is planned to reap more than 11 million ounces of gold and about 200,000 tonnes of copper concentrates per year over a new 15-year mine life. The town’s population of about 1500 is expected to grow another 1000 by Murray & Roberts, was awarded a The operation, which is 66.67 per cent the time the new mine development contract worth $111 million for the owned by Newmont and 33.33 per cent by commences production in late 2008. engineering design, procurement and AngloGold, is expected to produce more This would include a permanent mine construction maintenance phase of the than one million ounces of gold annually workforce of about 650, plus another 350 project. This followed the successful for the first five years, and a total of more ancillary services workers. completion of a pre-engineering contract than 11 million ounces over a 15-year worth $4 million. mine life, with the potential to extend. “We expect that between 300 and 350 new There has been a hiatus in mining at houses will be established in Boddington On top of that, an estimated 200,000 Boddington since the original oxide over the next three to five years,” tonnes of copper concentrate will be Mr Bradbrook told Prospect magazine. gold orebody was worked out, and the operation shifted to a care-and- produced from Boddington annually. On top of that, a 1000-person maintenance phase in December 2001. Resources Minister John Bowler said accommodation village will be that Boddington, along with other established to house the bulk of the The new $1.8 billion to $2 billion flourishing gold mining activity in construction workforce. Boddington development will see the mining and processing of gold and copper Western Australia, could push Australian In April, global engineering firm Aker rich basement rock beneath the existing gold production ahead of rival South Kvaerner, in joint venture with Clough oxide pits. Africa in the next few years.
2 Prospect Australia’s first LNG supplies land safely in China
In an historic moment for Australian “The North West Shelf Venture is proud Premier Carpenter said the LNG supply trade, the first commercial cargo of to have been selected by the People’s agreement also cemented the State’s liquefied natural gas arrived safely Republic of China as the preferred position as Australia’s leading exporter, and on time at a purpose-built supplier of LNG to China’s first LNG with latest trade figures showing Western receival LNG terminal at Cheng project,” Dr Hamilton said. Australia’s share of the nation’s exports Tou Jiao, near Shenzhen, in China’s at 31.2 per cent. In October 2002 the North West Shelf Guangdong Province in late May. Venture and Guangdong Dapeng LNG “The sale of LNG to China is an The 125,000 cubic metre consignment Company Ltd signed a sales and outstanding example of government and aboard the North West Shelf Venture’s purchase agreement for the supply of industry working together to achieve a LNG carrier Northwest Seaeagle departed more than 3.3 million tonnes of LNG common goal,” he said. from the port of Dampier at 4.06 am on per year for 25 years. The deal is worth 18 May — without fanfare. about $25 billion. The Woodside-operated North West Shelf Venture is Australia’s largest resource However, the previous day dignitaries Much of the gas will be used for project, with investment in onshore and from around the country including electricity generation, as well as for offshore oil and gas facilities totalling the Acting Prime Minister Mark Vaile local reticulation networks for industrial, and Western Australian Premier Alan more than $19 billion. commercial and residential consumption Carpenter were on hand to witness the in Guangdong Province and Hong Kong. ship’s loading. The venture is owned by six companies The gas may eventually be used as a — Woodside, BHP Billiton, BP, Chevron, Woodside’s North West Shelf Ventures transport fuel. Director, Jack Hamilton, said loading Japan Australia LNG (MIMI) and of the inaugural cargo to China marked China is now Western Australia’s Shell. The China National Offshore Oil the official start of a 25-year trading second largest trading partner (behind Corporation (CNOOC) is also a member of relationship between partners in the Japan), and the LNG contract will NWS project and its newest customer, further strengthen the State’s expanding the venture, but does not have an interest Guangdong Dapeng LNG Company Ltd. economic relationship with China. in the infrastructure.
Historic shipment: Among dignitaries at Dampier to witness the loading of the first LNG tanker for China were the Acting Australian Prime Minister Mark Vail (left) and Woodside’s North West Shelf Ventures Director Dr Jack Hamilton (foreground).
3 Prospect Refining moments: BP to bring biofuels into the mainstream
Australia’s first wheat-based ethanol plant could be operational at Kwinana by early 2008, adding a new dimension to resources development in Western Australia.
The $100 million plant, to be built and operated by New South Wales-based Primary Energy Pty Ltd, will produce 80 million litres of ethanol a year to blend in a 10 per cent mix with petrol for use by Western Australian and potentially eastern States motorists.
The fuel, to be known as e10, will be sold in BP service stations.
Western Australia’s Minister for Energy Francis Logan described the proposed ethanol plant as the start of an exciting new era in the use of biofuels in Western Australia.
“Using wheat to make liquid fuel is no longer a notion confined to science- fiction stories or chemistry laboratories,” Mr Logan said. “This is now a real concept. Ethanol produced at this plant will be in our cars by 2008.”
The plant will need to go through the normal planning and environmental approvals before construction can begin, but BP Australia is expecting that the plant will be up and running by early 2008.
The project will generate 35 direct jobs, 200 indirect jobs and 500 jobs during an 18-20 month construction phase.
Ethanol is a fermented renewable fuel produced from crops such as wheat and sugar. It is gaining widespread acceptance around the world in countries where it is blended with petrol for use as e10 biofuel: By 2008 Australian motorists will be able to fill up their cars with a 10 percent wheat-based ethanol—90 per a fuel. cent petrol mix at BP service stations. The first supplies of these fuels will be produced at BP’s Kwinana refinery.
In the United States it is now contained equivalent of removing 44,000 cars from tonnes of lower grade wheats, he said. in about 30 per cent of all petrol sold. our roads. This makes it an attractive proposition Other countries including Canada, Brazil, for farmers, providing another market for China, India and the European Union Mr Logan said that as a major grain their produce. are also increasing their use of ethanol producer, Western Australia was in a blends. prime position to use wheat for Mr Logan said the project would be the production of ethanol as an largely energy self-sufficient. Any excess BP Australia says the project will energy source. result in a 200,000 tonne reduction in electricity could be exported to the greenhouse gases each year — the The process will use about 200,000 South-West power grid.
4 Prospect From just browsing to some serious swot on Browse Basin
Pushed into the background for appraisal wells and undertake more most of the last 35 years, the concept definition studies this year. gas–condensate resources of the Ichthys Woodside is optimistic that it can deliver Scott Reef (Torosa) Browse Basin off Western Australia’s Brecknock its first cargo of Browse Basin LNG in Brecknock South (Calliance) Kimberley coast, are now the subject 2011-14. It expects to be able to make a of some earnest re-evaluation final investment decision in 2008-10. Derby by petroleum companies such as Broome Woodside and Inpex. Meanwhile, Tokyo-based Inpex Holdings is eyeing the possibility of an $8 billion With the demand for liquefied natural gas LNG export project involving its Ichthys (LNG) growing strongly — forecasters gas field, located near the Woodside are estimating a global shortage of about fields. 100 million tonnes by 2015 — renewed interest in the Browse Basin could see Ichthys, with a resource of about 10 one of Australia’s almost forgotten trillion cubic feet of recoverable gas, petroleum treasures developed within the could produce up to 6 Mt/a of LNG for the next few years. Japanese market.
Located offshore from Derby, the Inpex says it would prefer to be the Browse Basin is already known to hold sole owner/operator of any future development, but would never rule Bounty below: The aptly named floating drilling rig Ocean more than 30 trillion cubic feet of gas, Bounty which intercepted commercial quantities of gas and sufficient to provide more than 600 Mt out joint venture participation with a condensate during an exploration and appraisal campaign at of LNG. neighbour or an outside investor. Ichthys in the Browse in 2003 and early 2004.
About two-thirds of these resources are controlled by Woodside and its joint venture partners in the Scott Reef, Brecknock and Brecknock South fields.
Woodside discovered gas and condensate at Scott Reef (now known as Torosa) in 1971, the same year as it found North Rankin and Goodwyn in the adjacent offshore Carnarvon Basin. However, the company opted to develop North Rankin first because it was closer to markets in the southwest of the State.
Torosa and the nearby Brecknock (discovered in 1979) and Brecknock South (discovered in 2000 and now known as Calliance) have combined “estimated contingent resources” of more than 20 trillion cubic feet of gas and 300 million barrels of condensate.
Woodside is currently investigating a range of options for a large-scale LNG export operation, costing many billions of dollars. Options under the microscope include gravity-based and floating facilities in the case of an offshore development, the use of nearby islands or bringing the gas ashore for a North West Shelf-styled LNG processing and export facility. The company aims to drill a further four
5 Prospect – key infrastructure for resources
Western Australia is the The following feature provides nation’s largest export State, an insight into some of the and a major reason for this is resources-related activities at Broome the State’s ever–expanding these ports.
Port Headland resources industry. Dampier Port Hedland and Dampier are the largest and second largest tonnage ports in Australia, and have held these positions for Oakajee Geraldton many years.
Fremantle Altogether, there are eight Esperance Bunbury major ports along Western Albany Australia’s 12,500 km coastline, which collectively handle almost half of the nation’s exports by volume and almost 30 per cent by value.
6 Prospect Fremantle investigates island port facilities for Cockburn Sound
A man-made island is likely to Consequently, planning is well advanced of technical assessments looking at be created in Cockburn Sound to to find an alternative site in the port’s economic impact, port operations, provide additional container and outer harbour area to augment facilities water circulation, local and regional general freight handling facilities in the inner harbour. traffic, land use, impact on seagrass for the ever-expanding port of meadows, coastal processes including Four development options are currently marine-based recreation, flora and Fremantle. being examined for the Naval Base– fauna, heritage, visual amenity and public Kwinana area. Three involve a 182- Even though Fremantle’s inner harbour access and amenities. An overarching hectare island that would be linked to has the potential for expansion, continued strategic assessment of these issues is the mainland via a bridge, while the growth in container trade means that it well advanced. fourth involves a stage-one land-backed will eventually reach capacity. development, expanding to an island A recommendation on a preferred option, wharf and freight lay-down area via a taking into consideration environmental bridge under stages two and three. and stakeholder interests, is expected Jervoise Bay Australian to be made by the State Planning Marine City of Road and rail access options are also Complex Cockburn Commission in July or August 2006. being assessed. Either Anketell Road or Rowley Road could be used as a corridor The Minister for Planning is then to link up with the Kwinana Freeway. expected to make a submission to State Cabinet seeking a decision on the Rockingham Highway The Fremantle Ports’ Outer Harbour preferred option. Once the preferred Stage 3 Project is shaping up to be the second option has been identified, a full statutory Proposed Stage 2 Naval largest infrastructure project in Western approvals process will begin, with the aim option 2 Base Australia’s recent history, behind the $1.5 Stage 1 of achieving all approvals by mid 2008. billion Mandurah Rail Project. Construction is expected to start in 2010, While no firm figures are available at this Anketell Road with Stage One due to be completed by stage, the cost of the new harbour project 2017 when Fremantle’s inner harbour is Proposed will run into hundreds of millions of JPPL expected to reach capacity. Town of private port dollars and could be as high as $1 billion. Kwinana Fremantle’s inner harbour, which is a Considerable industry, across- well-designed, deep-draught port, will government and community consultation continue to operate in conjunction with has taken place over the past three Outer harbour: One of several options being considered by the proposed new facilities in the outer Fremantle Ports to augment facilities in the inner harbour. years. There have also been a series harbour.
The port handles about $18 billion worth of trade annually. About 91 per cent (by value) of Western Australia’s total maritime imports come in the form of container trade which has grown by about 11 per cent annually over the past decade.
Also, about 28 per cent (by value) of the State’s exports are generated by the port of Fremantle.
Expansion plans: Container traffic within Fremantle’s inner harbour continues to grow, so much so that plans are in hand to establish additional cargo handling facilities in the port’s outer harbour. 7 Prospect Government favours Oakajee for new Mid West port Since 1976 various planning and engineering studies have concluded that Oakajee is the natural site for a bulk shipping port to complement Geraldton. Its development now has the official endorsement of the Western Australian Government.
The Western Australian Government Currently, two companies are exporting scale downstream resources-based has confirmed Oakajee as the iron ore out of Geraldton — Mt Gibson processing industries, plus support preferred site for a new privately Iron Ltd from its Tallering Peak mine, and services, to be established at Oakajee. Midwest Corporation from Koolanooka. funded deep-water port about 20 km Four of the five member companies of the north of Geraldton. However, there are limitations with port Geraldton Iron Ore Alliance —Midwest facilities at Geraldton, especially with Corporation, Murchison Metals, Gindalbie Premier Alan Carpenter said the respect to the depth of the harbour, Metals and Golden West Resources — are proposed new port development would making it impossible for larger Cape- behind plans to establish a new deep- support the Mid West region’s expanding class iron ore carriers to use the port. water port at Oakajee. iron ore industry. Studies show that developing a • Midwest Corporation is looking to He said studies undertaken by the Mid deepwater port at Oakajee will be export 15-20 Mt/a of hematite ore West Development Commission indicated quicker, cheaper and have fewer from its Weld Range deposit and that several major resource projects environmental and social impacts than about 4.5 Mt/a of magnetite from its could generate up to 60 Mt/a of export expanding the port of Geraldton. Koolanooka deposit. iron ore from the region. For their smaller first-stage projects, • Murchison Metals could export up “The expansion of Geraldton port’s it suits Mt Gibson Iron Ltd, Murchison to 25 Mt/a of hematite ore from the capacity beyond 20 Mt/a will be Metals and Midwest Corporation to use Phase 2 development of its Jack Hills unacceptable from both social and Panamax-size ships to export limited deposit. environmental perspectives,” Mr tonnages of high-grade iron ore from Carpenter said. the already busy port of Geraldton. • Gindalbie Metals has plans to mine magnetite iron ore at its Mt Karara “The two ports will complement each These ships can access customers in deposit, and slurry it as a concentrate other, and both will come under the China via the Yangtze River. However, to a proposed pellet plant at Oakajee. jurisdiction of the Geraldton Port these companies foreshadow larger, The plant aims to produce 7 Mt/a of Authority.” second-stage projects that cannot be accommodated in Geraldton and they pellets for export. The next step will be to consider a view Oakajee as the only viable option • Golden West Resources could export report from a government steering for using larger Cape-size ships to up to 10 Mt/a of hematite iron ore committee which will examine the design deliver bigger tonnages to their overseas from its Wiluna West deposit. process, timing of construction and the markets. operational management of a deepwater The fifth company in the alliance is Mt An added bonus with Oakajee is the huge port at Oakajee. Gibson Iron. undeveloped industrial estate adjacent to The demand for Western Australian iron the port. Comprising a gross core area of Alliance chairman Clive Brown said ore is soaring, and that includes resources 1135 hectares with a 5310 hectare buffer costs for developing Oakajee were yet from the State’s Mid West region. zone, there is plenty of room for large- to be determined, but it would run into hundreds of millions of dollars.
The project will also involve more than 400 km of rail infrastructure.
While various options are being considered, Mr Brown is hopeful that both the rail and port infrastructure will be operating by 2010 to take advantage of favourable marketing opportunities that are predicted to be driven by expanding demand in China and India.
Mr Brown said another priority was to secure all necessary approvals for what is shaping up to be the biggest series of resource development projects in the Mid West’s history. Position, position, position: A massive (currently unoccupied) 1135 hectare industrial estate is available for export and service industries at Oakajee in Western Australia’s go-ahead Mid West region.
8 Prospect 4HE .EW &ORCE IN )RON /RE
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FMG009 a4 ad _final3.indd 1 18/5/06 12:10:58 Iron ore sees Geraldton port trade double
It may be Australia’s second largest Mt in 2005/06 and rise to about 15 Mt/a grain export centre, but the port by 2009. of Geraldton owes much to the In January 2006, the Western Australian resources sector — namely iron Government approved a $35 million ore, mineral sands, zinc, lead and upgrade of Berth 5 as a new dedicated talc— for the doubling of trade over iron ore berth. the past few years. The project is crucial if the port is to meet In 2004/05 a total of 306 ships carrying the increasing demand for iron ore export 5.5 Mt of cargo either arrived or departed capacity. from Geraldton, compared with 203 ships carrying 2.8 Mt in 2000/01. Seven iron ore projects are currently being promoted across the region, and The first iron ore exported from until a new port is established at Oakajee, Geraldton during the current growth Geraldton is the only viable exit point for phase involved a 38,000 tonne the region’s iron ore products. consignment from the Mt Gibson-owned Tallering Peak mine, which left the port The upgrade of Berth 5 at Geraldton in February 2004. [Iron ore was first will include a new iron ore ship loader shipped out of Geraldton from Western and modifications to adjacent berthing Mining Corporation’s Koolanooka mine pockets to allow 240-metre iron ore in 1966.] carriers to call at the port. The upgrade Getting busier: Better known as Australia’s second largest grain port, the port of Geraldton is handling more exports work on Berth 5 is expected to be than ever, thanks to iron ore, with exports of the commodity Iron ore exports are expected to reach 2.3 completed in the third quarter of 2007. expected to rise from 2.3 Mt in 2005/06 to 15 Mt/a by 2009.
10 Prospect MASSIVE INDIAN INVESTMENT IN AUSTRALIA MASSIVE INVESTMENT
Pankaj Oswal Chairman and Managing Director
A $700 million investment by the Delhi- ASA, one of the world’s largest fertiliser based Oswal Group – the largest ever Indian distributors. Prime markets are India, Japan investment in Australia – started to pay and SE Asia. dividends in May this year when the Burrup The ammonia plant is the WA Government’s Fertilisers ammonia plant was offi cially opened fi rst return on its $180 million common user by WA Premier, Alan Carpenter. infrastructure package designed to attract Strategically located on the Burrup downstream processors to the Burrup. The peninsula in the north west of Western package includes a substantial upgrade to Australia, close to the state’s rich offshore the Port of Dampier, a desalination plant and a gas reserves, the project is the world’s service corridor. biggest greenfi elds ammonia plant. It utilises Chairman and Managing Director of Burrup Level 8 St Georges Square natural gas as feedstock to produce liquefi ed Fertilisers, Pankaj Oswal, said his company 225 St Georges Terrace ammonia, primarily for use in the manufacture is currently studying the feasibility of an Perth, Western Australia 6000 of fertiliser. additional plant to produce ammonium nitrate Tl: +61 8 9327 8100 Total output from the plant has been taken for the manufacture of explosives for use in Fx: +61 8 9327 8199 up for the next 20 years by Yara International Western Australia’s booming mining sector. www.bfpl.com.au Dampier: Australia’s most strategic port
The port of Dampier is rapidly which operate facilities on the west side • The proposed deployment of a Water gaining recognition as the most of the port; Woodside Energy which Police Unit at Dampier; and strategically important port in the operates major LNG and LPG export • Support facilities for the multi-billion country. facilities to the east at Withnell Bay; and now Burrup Fertilisers which operates a dollar Gorgon, Pluto, North West In addition to the large volumes of iron world-class ammonia production facility Shelf LNG Train-5, and Onslow LNG ore, salt and various petroleum products on the Burrup Peninsula. Dampier port projects. that are exported, liquid ammonia was also supports the rapidly expanding A spokesman for the Dampier Port recently added to Dampier’s growing list offshore oil and gas industry. Authority said that with $11 billion worth of export commodities. of products annually now leaving the port But, there is much more proposed for the and other offshore facilities, authorities This was made possible through the port, including: investment of $52.2 million on a new at both State and national levels have bulk liquids jetty at Dampier, with • The proposed forward deployment firmly recognised the area’s strategic importance to Australia. the first exports of liquid ammonia of two Australian Navy Armidale- being despatched to India in June class patrol boats from Dampier in The level of infrastructure improvements this year. January 2007; around the port has been dramatic in Another $17.5 million was spent on recent years, and will continue to be the • A boost in Australian Customs dredging works at Dampier to allow case. Hundreds of millions of dollars personnel to 40 at Dampier by the Panamax-size ships to use the jetty. are being spent at Parker Point and East end of 2006; Intercourse Island by Rio Tinto to double The port of Dampier was developed in the the port’s iron ore export capability, 1960s and established as a port authority • The proposed deployment of while similar amounts will be required in March 1989. The port has four major a contingent of the WA Police for export facilities linked to the North users. These are Hamersley Iron and Department’s tactical response West Shelf LNG Train-5 project and the Dampier Salt (both Rio Tinto subsidiaries) group at Dampier; Woodside Pluto LNG project.
Diverse and strategic: A section of the port of Dampier with the newly commissioned $700 million Burrup Fertilisers’ ammonia plant in the background. The liquid amonia export jetty is in the foreground. 12 Prospect Port Hedland —our biggest port
The sheer weight of iron ore — and the steadily rising demand for the commodity — have combined to make Port Hedland Australia’s largest tonnage port.
In 2004/05 Port Hedland established a new trade record of 108.5 million tonnes, making it the first port in Australia to break through the 100 Mt barrier in a single year. Heavy duty port: Port Hedland, Australia’s largest tonnage port in 2004/05, with Finucane Island in the foreground. Port Hedland enjoyed a 21 per cent increase in cargo volumes for the year, Exports dominate the Port Hedland Port Hedland’s imports include and the trend is set to continue, with Port Authority’s trading ledger, accounting sulphuric acid, bitumen, fuel oils iron ore exports expected to exceed 150 for all but about 500,000 tonnes of all and general and containerised Mt/a by 2008 and 200 Mt/a by 2010. tonnages moved through the port. cargoes.
Considerable upgrade work is planned for BHP Billiton Iron Ore is the port’s The port is of major economic Port Hedland, with BHP Billiton extending largest customer, exporting 103.3 Mt or importance to Australia in that it its C Berth at Finucane Island to take larger 94 per cent of all products handled in contributes about $7.3 billion to the Cape-size ships, while Fortescue Metals 2004/05. Other commodities exported nation’s annual balance of trade. Group is planning two new berths, one a from Port Hedland for the year included This figure is expected to increase to Cape-size loading berth and the second a salt, manganese, chromite, feldspar, around $17 billion by 2010 as iron ore Cape-size lay-by berth. copper concentrates and livestock. exports continue to grow.
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www.plantman.com.au 13 Prospect Extension of Broome jetty
Broome’s famous jetty in the tropical offshore oil and gas industry. turquoise waters of Roebuck Bay has “We are moving from a high of 1100 grown an extra 148 metres — thanks vessel visits last year to an anticipated to tourism, pearling, fishing and a 1300 vessels in 2006/07,” Mr Ahearn said. vibrant offshore petroleum industry. “While we have had a number of luxury The trestle-type steel and concrete jetty cruise ships in the past, their frequency is now more than a kilometre long, with will increase in future,” he said. the outer 331 metres being used for commercial berthing purposes. On top of that, Broome will be the supply base for three major drilling campaigns A 148-metre extension at the business- in the offshore Browse Basin this year. New Broome: Tourism, the resources sector and other end of the jetty was successfully industries are delivering new opportunities for the port Inpex, Shell and Woodside will require of Broome, so much so that the local jetty has just been completed in May this year at a cost of extended 148 metres. This photo was taken from the deck of $18 million. fuel, water, drilling muds and other the cruiseliner “Orion” which visited Broome in April. consumables during these campaigns. Broome Port Authority Chief Executive Offshore petroleum development activity Officer, Jim Ahearn, said the port was is likely to follow, with the anticipation gearing up for an increase in cruise and that Broome will see continued charter boat traffic, plus a substantial increases in vessel visits related to these increase in activity associated with the developments out to 2012. Albany planning to be Australia’s largest woodchip port Woodchips are helping to make Albany one of the fastest growing ports in Western Australia, and in the future possibly the largest woodchip port in Australia.
Woodchip exports more than doubled from 223,185 tonnes in 2003/04 to 458,732 tonnes in 2004/05.
This upward trend will continue, with Woodchips and possibly iron ore: One of Australia’s biggest woodchip ports, Albany is also eyeing a potential new major annual woodchip export tonnages export item — iron ore, from the proposed Southdown magnetite mine northeast of Albany. expected to increase to about two million test the economics of establishing a mine A number of environmental studies and tonnes in to next four years. and the export of 6.6 Mt/a of iron ore a detailed analysis of the seabed along concentrate from Albany. And trade through the port of Albany the proposed dredging route to identify will leap exponentially should Grange The project will require an extensive any possible impacts on local seagrass Resources proceed with the development dredging program to provide access for meadows are almost completed. of its Southdown magnetite iron ore Cape-class ships of up to 175,000 tonnes, deposit about 90 km northeast of Albany. plus the reclamation of about 7 hectares In terms of overall export trade, the The company currently has an $18 of land and the construction of a new port of Albany is heading along a steep million feasibility study in progress to berth to handle the extra export trade. growth curve.
14 Prospect Coal and copper on Bunbury Port Authority’s proposed export list
Shipping trade from Bunbury will be Bunbury is part of a wider structure plan 12.27 Mt of trade, has acquired two significantly boosted when a plan to being developed by the Bunbury Port new customers in recent years. These export bulk coal from the South West Authority, which is examining various are woodchip producer Hansol PI Pty land-use and port access options for region reaches fruition. Ltd which is now generating 250,000 Bunbury. tonnes of export product annually, and The Bunbury Port Authority is currently With the proposed closure of Bunbury’s TiWest which has re-located its 230,000 investigating the feasibility, both outer harbour, all future growth will take t/a mineral sands export facility from technical and economic, of developing place within the port’s inner harbour. Fremantle to Bunbury. facilities within the port’s inner harbour to cater for the handling and export of up The most recent development in this area Another commodity that could boost to 10 Mt of coal per year. was the christening of Worsley Alumina’s Port of Bunbury exports will be new No.6 berth in late February. The copper concentrates from the soon- South West coal majors Griffin Coal and company has invested some $52 million to-be developed gold–copper mine at Wesfarmers Coal are eyeing an export on constructing the berth, plus the Boddington. Up to 260,000 tonnes of coal business out of Bunbury. acquisition of a new ship loader. copper-gold concentrates could be The concept of exporting coal from The port, which in 2004/05 handled exported through Bunbury port.
Growth from within: The christening of Worsley Alumina’s private new No. 6 berth in February 2006 added to facilities within the port of Bunbury’s flourishing inner harbour.
15 Prospect Esperance to have container capability in 2007
Esperance is one of many bustling Ravensthorpe Nickel Project. Canada, plus another 40,000 t/a of ports along Western Australia’s magnesia in containers from Queensland. Project operator BHP Billiton aims 12,500 km coastline that is to despatch up to 220,000 tonnes of The combined cost of the gantry crane, gearing up for major growth and nickel/cobalt hydroxide annually from new storage shed and associated diversification in trade. Esperance, commencing in the second upgrade work at the port will be about quarter of 2007. The product will be $31 million. And it will be resources that will drive loaded into purpose-built containers and trade figures to new record levels. shipped to the company’s Yabulu refinery The range of exports from Esperance will near Townsville in Queensland. From a mainly agricultural base 30 years grow even further in 2008 when the first of an expected 300,000 t/a of woodchips ago, exports from the port of Esperance The Esperance Port Authority has have increased 22-fold from 342,000 awarded a contract to ZPMC of China for are shipped to overseas markets. tonnes in 1974/75 to 7.7 Mt in 2004/05. the supply of a shore-based gantry crane The port of Esperance currently has two to handle the containers. Nickel and iron ore have helped boost land-backed wharves capable of handling exports in recent years. The next On top of that the Ravensthorpe Nickel Panamax-size vessels and a dolphin major growth spurt will come from Operation will import via Esperance berth that can accommodate 200,000 the development of the $1.8 billion about 500,000 t/a of sulphur prill from tonne Cape-size ships.
Bay of plenty: Trade via Western Australia’s largest south coastal port at Esperance will be further boosted when the Ravensthorpe Nickel Project begins production next year.
16 Prospect The driving force for your energy business
p.o. box 9117, floor 20, al attar business tower, sheikh zayed road, dubai, uae In association with phone: +971 4 332 0007 fax: +971 4 332 0008 email: [email protected] Eyes on AMC for subsea test facility
The Australian Marine Complex is usually undertaken on rig platforms, those on the sea floor. (AMC) could soon be the site for standing like towers on the sea floor. As With a number of prospective another Australian first. production moves into deeper water, the cost of building these platforms sedimentary basins off Western The Western Australian Government has increases and subsea production Australia’s coast, WA is the ideal place to made a $150,000 grant for a feasibility becomes a more economic alternative. host a WISS test facility. It is proposed study into the construction of Australia’s to be an independently managed, first Well Integrity and Subsea Support Before equipment is placed on the sea open-access facility that would provide (WISS) facility. floor, beyond the reach of divers, suitable expertise and capabilities to support the integration testing must be undertaken. operations of WA-based companies. The study will be conducted by Advanced Well Technologies for the facility to be The proposed WISS facility will enable A go-ahead for the WISS facility is built at the AMC at Henderson, testing in simulated conditions such as expected soon, with south of Perth. construction likely to begin later this year. Offshore oil and gas production
Study grant: Western Australia’s Science and Innovation Artist’s impression: The only one of its kind in the southern Minister Francis Logan (third from left) in company with DoIR’s hemisphere, the proposed WISS facility will allow companies Senior Project Officer Jim Leven (left), and DoIR officers Rob to test control systems and the interface of wells and allied Parker and Steve Arnott (right) when the $150,000 study grant subsea equipment before installation. was announced.
18 Prospect Sign off for Gindalbie Metals iron ore project
The Mid West is on track to host one and the contribution of funds and debt Mine construction is expected to begin of the first magnetite iron ore mines exposure by Anshan in return for a 50 per in the first half of 2007, while the first in Western Australia. cent stake in the project. production of pellets is due in mid 2009. The plan is to mine the Karara resource This follows the signing of a $1 billion There are several other significant — currently 737 Mt of magnetite grading joint venture and funding agreement magnetite iron ore projects in Western 37.1 per cent iron over half its known between Gindalbie Metals and China’s strike length — then concentrate the Australia that are presently being second largest steel maker Anshan Iron ore at the mine site, and transport it via assessed for commercial development. and Steel to develop the Karara iron ore a slurry pipeline to Oakajee, north of The most advanced of these are the deposit 260 km east of Geraldton. Geraldton, where it will be transformed Southdown resource, east of Albany, into pellets for export to China. The deal, signed in Canberra during April which is eyeing a Q1 2010 production in the presence of senior officials of the Drilling of the resource will continue as start up; the Fortescue deposits near Australian and Chinese governments, part of final feasibility studies which are Cape Preston, south of Karratha; and the involves a 10 Mt/a offtake agreement due to be completed by March 2007. Mount Gibson resource in the Mid West.
Gindalbie Metals’ Karara iron ore resource area
Existing rail infrastructure Oakajee Mullewa Towns Existing ports Geraldton
Karara
N Morawa
Dongara
Three Springs
Mt Gibson Indian Ocean
Eneabba
Wubin
Magnetite signing: Officials of Gindalbie Metals and Anshan Iron and Steel gather in Canberra to sign a $1 billion joint venture funding agreement to develop the Karara magnetite iron ore resource east of Geraldton.
19 Prospect N Port Hedland Hope Downs on track Dampier Cape Lambert for rapid development
Proposed rail Existing rail
Hope Downs 1
West Angelas Hope Downs 2
Hope Downs 3
The recent go-ahead for the $1.5 billion development of the Hope Downs iron ore project means a lot more than just money to Western Australia’s pioneering Hancock family.
It is the culmination of more than half a century of exhaustive effort to commercialise a world-class iron ore resource — and especially to honour Hope Hancock, wife of Western Australia’s famous flying prospector Lang Hancock.
Mrs Hancock was part of a now well- documented “flight of discovery” in November 1952 when Lang Hancock spotted what he believed was significant mineralisation in the gorges of the Hamersley Ranges.
Mr Hancock returned to the discovery area in 1953, landing in adjacent spinifex Hope Hancock: The lady after whom Hope Downs was named, with husband Lang and grand daughter Bianca Hope Rinehart. The photo was taken in 1982 by the Gina Hope Rinehart the year before her mother died. country. He took rock samples over a wide area which later confirmed the There wasn’t much interest in Hope An overarching State Agreement includes presence of high-grade iron ore — and a Downs other than from Mr Hancock other mines in the Hope Downs area mineral field of world significance. himself. HPPL later applied for and was which will require rail extensions as they Mr Hancock continued his exploration granted mineral rights over the area are developed. and identified Hope Downs in the late after a change of the State Government 1960s. The area is now the subject of a in 1983. Rio Tinto Iron Ore chief executive Sam 50:50 joint venture agreement between Walsh described the Hope Downs project Hope Downs Iron Ore (a subsidiary of The Chairman of Hancock Prospecting as one of the most significant mine Hancock Prospecting Pty Ltd) and Rio Gina Rinehart said the go-ahead for the developments in Hamersley Iron’s 40- Tinto Iron Ore which was signed on 27 Hope Downs project was the realisation year history. April 2006. of a deep and long-held vision for the Hancock family. He said the same mining and engineering This followed ministerial approval on 31 model as West Angelas would be used to March 2006 to proceed with the initial It will involve the initial development of bring Hope Downs into production. development of the Hope Downs project. a new iron ore mine and a 58 km railway line connecting into the Pilbara Iron rail Ground breaking began at the Hope Securing the Hope Downs ground system near West Angelas. The rail link Downs 1 mine site and on the rail — and holding it — proved difficult for project within days of a State Agreement the Hancock family company, Hancock will be called the Lang Hancock Railway, Prospecting Pty Ltd (HPPL). In the early along which up to 30 Mt/a of Marra being signed in April 2006. Up to 1500 1970s HPPL had Hope Downs taken away Mamba iron ore will be delivered to the construction jobs are expected to be by the State Government and put into coast at either Dampier or Cape Lambert generated during the construction phase a Ministerial Reserve, only to regain it for export to Chinese steel mills and and 150 full-time jobs when the mine more than a decade later. other iron ore buyers in Asia. commences production in 2008.
20 Prospect With over 800,000 items of top quality equipment in stock, you might think it’s our hire fleet that has made us Australia’s leading hire company. But it’s what our staff give, rather than what they hire out, that gives us the real edge. Coates staff work harder, train harder and try harder to give our customers the kind of service no other company can equal, with a commitment to the safety of customers and staff that borders on obsession. From branch staff to maintenance crews to logistics people, from the newest trainee to the most senior management, every employee puts their heart into everything they do. If they didn’t, they wouldn’t be working for Coates. It’s that simple. It’s what makes us the best and what makes Coates the hire company of choice for Australia’s top companies.
For further information about Coates equipment and services, visit our website: www.coates.com.au or call us on 13 15 52. 21 Prospect Worldwide interest in WA mine refuge chambers
An underground refuge chamber four and 30 people. The one used at and use of the underground mine refuge that was successfully used in the the Leviathan gold mine at St Ives was chambers in Western Australia. rescue of nine mine workers at the designed to hold 12 people for 36-hours. Leviathan gold mine at St Ives (near “Western Australia is one of the few MineARC was recently asked to quote and States that required the compulsory use Kambalda) in March is attracting design a unit capable of holding between of refuge chambers in all underground considerable international interest. 200 and 300 miners at Grasberg. There mines and they have certainly proved are up to 2500 people working in the Welshpool-based MineARC has been their worth,” he said. underground operation at any one time, swamped with follow-up enquiries, to and the proposed new refuge unit will an extent that supply orders for the The Managing Director of MineARC be 75 metres long, 10 metres wide and chambers will more than treble from Geoff Whittaker said his company first seven metres high. about 60 in 2005 to about 200 this year. displayed a prototype at the Goldfields Mining Expo in the late 1990s. In effect, the refuge chambers are like The biggest interest is coming from a submarine. Except, instead of being Indonesia and the Americas. After attracting some interest from under water, they operate under ground. Western Mining Corporation, he The company has already sold 20 of MineARC recently took one of its units organised a trial in the underground its underground refuge chambers to to the United States where it was put on workings of WMC’s Agnew gold mine. Freeport’s giant Grasberg copper–gold display in the foyer of the Riviera Casino, The unit did not live up to expectations, mine in Irian Jaya (the Indonesian part of as part of a US coal workers’ conference mainly due to the lack of an independent Papua New Guinea). and exhibition. air conditioning system. The self-contained units come in various Employment Protection Minister John After a number of refinements sizes, and can accommodate between Bowler has praised the development — in association with mining industry representatives including mines inspectors from the Department of Industry and Resources — the refuge chambers are now being built to an agreed standard.
MineARC, which has about 150 of the refuge chambers in use in different underground mines around Western Australia, recently increased its staff at Welshpool from 10 to 12. The company recently opened a branch office in Dallas, Texas, and also has sales agents in Canada, Chile, Portugal and Turkey.
The company’s standard 12-person, 36-hour refuge chamber costs about $73,000, and with a local labour and materials content of about 95 per cent that spells good news for both mine safety in Western Australia Roadshow: The Managing Director MineARC, Mr Geoff Whittaker (left), and the Assistant Director of the American Mine Workers Union Mr Dennis O’Delle, with MineARC’s highly acclaimed mine refuge chamber outside the Las Vegas Convention and the State’s reputation for Centre where it was displayed during a successful promotional tour of the United States recently. industrial innovation.
22 Prospect Investment opportunities in Western Australia
An updated series of resources investment brochures has just been released by the Department of Industry and Resources.
The topics include: Mineral and petroleum exploration, nickel and cobalt, ferro-alloys, titanium sponge metal, tantalum and niobium, silicon products, aluminium, direct reduced iron and pig iron and eucalypt wood plantation pulp.
Not only are there details about each of these investment opportunities, but also keys reasons why companies should invest in Western Australia’s resources sector generally.
These include: • Political stability • Abundant and competitively priced energy • A skilled workforce • Proximity to emerging markets, and • Supportive government policies. For more information, please link to the following website: Innovatively Australian. www.doir.wa.gov.au/investment Global in Perspective.
Woodside is Australia’s pre-eminent upstream oil OpportunitiesOpportunities in Western Australia in Western A N D Australia ALYPT WOOD and gas company with a 50-year history backed by PETROCHEMICALS AND Opportunities in Western AustraliaNICKEL & COBALT RESERVES OFSATE FROMCHEMICALS WORLD-CLASS LATERITIC PRODUCTION FROM WORLD-CLASSDE OIL AND CONDEN FERRO-ALLOYSSULPHIDE NICKEL–COBALT DEPOSITS one of the world’s premier LNG developments, the Opportunities in Western Australia NATURAL GAS, CRU Opportunities in Western Australia ALUMINIUMEUCALYPT WOOD
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iron by weight) using natural gas as a reductant. The The reductant. a as gas natural using weight) by iron fo Korea, Spain and the United States. We’re now I for Western Australia. This study has I
areas of the State. Further synerMid West and Pilbara regions. s typically convert iron ore to a denser product (90%–93% (90%–93% product denser a to ore iron convert typically th sales.
of propylene-based chemicals and plastics, notably =
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s onnes per annum of chromite oreT from its Coobina deposit
Niobium Applications OS M M M M M M M M Merchant pig iron and to a lesser extent DRI is utilised utilised is DRI extent lesser a to and iron pig Merchant t
of a Modernworkforce, aluminium water, smelters gas and need electri around 14 megawatt-The primary use of niobium is in the form of ferro-niobium which
manganese ore and chromium ore as speciality INE P <
Application basin studies, and in recent years the department has is used as an alloying agent in the production of speciality steels
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co products slab and management and marketingThe with Windimurra vanadium operation,The ferro-niobium product is mainly sourced fromrecently the minerals
also located in the Pilbara. ThereIPE is significant potential for
pyrochlore and columbite which are predominantly found in #OLLIE markets. EPOSI y
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steel inputs. Vanadium concentrate production lic RE DE primarily used for the production of high-purity niobium chemicals 7ORSLEY and alloys. Niobium oxide and niobium carbide are two of the
further downstream opportunities in: opportunities downstream further industries established or proposed for N 3ADDLEBACK
reO shutleased down, is farm-in planned for redevelopment opportunities largest selling chemicals. The oxide is used in bookletsceramic capacitor imestone. in =cooperation
Production of HBI/DRI/pig iron leads to to leads iron HBI/DRI/pig of Production anode smelter technology developed by Alcoa promises0ORT to fo st < <
d acoustic wave (SAW) filters and glass coatings for computer C
feedstock, at a competitive cost, to support a ts
Information is available on six sites screens. Refined niobium metal is also used in eedstocksuper conductors 'AS PIPELINE !LUMINA BAUXITE DEPOSIT e Butane as e a feedstock to a petrochemical cracker or ntalum. It is estimated the State has at least 75% of reduce this even further. and super alloys.
under#OAL DEPOSIT new ownership.!LUMINA REFINERY e le
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orld-scale olefins based project located in 9 < r dehydrogenator provides the basis of a wide range of butylene Australia has three tantalum producers. Sons of Gwalia’s (SOG) w order of 10-40% in recent years.s ern Australia’sC resource'AS PIPELINE endowment opportunity d Hardwood plantation estate
State’s Pilbara region is prospective for The rangest of possible ferro-alloy 7AGERUP
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the Dampiermajor resources regionc ofprojects, Western is politicallyAustralia. stable We produce i
i m manganese, chromium, vanadium and quartzp
ee butadiene, n-butanol, butylNew acetate, investorsthe Stateisobutylene particularly are welcome and suited methyl to the pr in Western Australia.
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hat hat v ferro-manganese and silico-ma
h a and has opportunitiest for other projects that providing the opportunitytall for a combined An opportunity exists for a chemical (kraft) s methacrylate. s are The largeFrom world-scale humblee offshore beginnings natural 50 years ago,oonn Sound Economychrome, ferro-silicon and ferro-vanadiu e with a carbon ferro-alloymay provide plant. The synergies. Pilbara region As alsopart of its policy regi erro-manganese and silico-man opportunitypulp and/orgas chemi-mechanical and oil reserves mills in thein the North West Condensate and “light sweet” crude oilF as feedstock outh Westoffers or Great competitively Southern regions priced of power (utilising the s generally produced via electric fu re processed through condensate splitters or crackers 3%% S numeroustoegion’s attract abundant and major assist gas reserves), value-added discoveries another industrykey of oil,a gas anandd The Western Australianof manganese ore economyand lump iron ore is expected).3%4 to exceed of esternWesternr Australia, Australia based on established contain economic an realisedeposits, the truean increasing economic proportion value of their is from respective lateritic nickel. As the world’s largest and most efficient r c with a carbon based reductant and l quantitiesW iningredient Western of condensate, for Australia, a ferro-alloys light the plant. crudeState The Government andMid the components.ern This Australia processing4% growth hosts has world-class the in potentialtheF lateriticerro-manganesenext to providefew and sulphideyears is formed firstas wthe State experiences producer of alumina, together with the st We produce more than 40% of Australia’s oil and eucalyptus estglobulus region blue is gumthe plantationsmost prospective area for We manganese slag being further treated liquefiedavailabilitycondensate of competitively Wpetroleum priced powerin gas Western (LPG).The Australiapresence have bbeeneenfeedstocks such as aethane, mining propane, and lightinvestment olefins, naphtha boom. and has set aside large areas of land for heavy nickel–cobaltU deposits, many of which arequartz, yet limestone to be and dolomite to andgrowing well-establishededevelopment ficienton privately infrastructure, wood ownedresource of farmland.vanadium is available production. for a mid-distillates that are particularly sought aftersilico-manganese. as feedstock of abundantrf sources of “wet” natural gas and exploited. There isNTALUM DEPOSITMINE the potential to add further reserves and 0ORT erro-silicon is made via the electric industry in the Pilbara and South West regions the value-adding downstream4A petrochemical and chemical 'AS PIPELINE F WesternSu Australia is an attractive location to xplorationW isorld-class ongoing. production “lightmade. sweet” As crudes a result offers the an opportunity value of productionon iiss e O smelting of silica and lump iron or to investorld-scale in the aluminium chemical industry. (kraft) pulp mill with industries. of the State. The cost of this land compares 20 000 per tonne when based reductant. High-purity feedstock w "ALD (ILL gas. As well as our homeland, our interests span the to develop a gas-based and/or a multi- – Petroleum production in-OUNT $EANS Western Australia has grown Western Australia’s proximity to expanding etroleum Resources %SPERANCE P L
favourablyan output with in the alternative order of 750 000 locations, tonnes or a either Asian markets and the continued growth in O prices. competitive
feedstocknowestern Australia is the overworld’s largest option US$7 petrochemical billion annually. complex opportunity internationally at energy offers KM steadily over the years, from US$24 million worth of
Natural Gas ODGINA now Australia Western 1995, W January in deregulated was
chemi-thermomechanicalthe aluminium sector for themill foreseeable with an output 7 interstate or overseas. sector energy the since prices close tosource of mineda tantalum world-class concentrates. petroleum province.
The rapid growth in demand for tantalum, production in 1973 to overgas in fall rapid the With US$7 billion now.
ern Australia’s petroleum resources mid-1960s. includethe in Australia world-scale
particularly in the electronics market, future make the State an ideal site for the st of iron ore mining in Western Western in mining ore iron of
We $ALGARANGA th something in the order of
provides anin opportunity the for companies order of 250–300 000 tonnes. start the since ore iron priced
The true economic value of the gas and r to develop new deposits of tantalum
estern Australia has a vibrant local competitively supplied has It !LBANY and establishestablishment a tantalum powder plant of an aluminiumntaining both tantalum smelter. and niobium gas. and ore iron — materials United States and Africa. We’re backed by world- estern Australia, already one of the serves of natural gas (around 113 trillion cubic feet) and L
W premier mineral orld’s provinces, re in Western Australia. The ores found low-cost of resources large xpanding silicon-based chemicals and xample, silicon is worth US$1000 per The potential for ongoing exploration omponents for the and electronics omputer industries.
condensate is realised from the separationin Western Australia are pegmatites of its in lies advantage main Its market. Asian In 2004, 58 Western AustralianKey locations oil and gas fields the material is used for making c c opportunity Silicon is the feedstock for an e industry. metallurgical W w of in produces 30 excess 000 tonnes of high-quality silicon annually from a smelter operated by Simcoa Operations Pty Ltd at Kemerton in the State’s vibrant South West region. This an provides opportunity for investors to further silicon process into higher-value commodities, especially polycrystalline silicon and silicones. The potential are high. rewards For e tonne, whereas polycrystalline silicon is wo US$15 000 A study undertaken by Australian based the to metallics merchant of supply the for co 'REENBUSHES
“light sweet” crude oil/condensate (2 billion barrels).
pentoxides. positioned strategically is Australia Western economy, a world-leading quality of life, a markets Asian L
onsultant URS and NLK of Canada KM its constituents — methane, ethane, propane, other on focussed more is DRI for demand produced:
c iron supply to basic oxygen steel plants, while while plants, steel oxygen basic to supply iron
has led to the increased potential for metallic metallic for potential increased the to led has Currently “wet” natural gas and natural gas associated with
success in Western Australia Asia East in growth economic isin surge The enormous,ous, 0%24( s
butane, naphthaskilled and workforce, mid-distillates goodsupply. highlightedshort in remain to likely is industrialmetal — that which a Western relations, Australian demand in East Asia, a region where scrap scrap where region a Asia, East in demand ondensate / crude oil production are brought onshore in the c "UNBURY
momentum due to the strong growth in steel steel in growth strong the to due momentum oil 12 gigalitres (76 million barrels)
has opened over the last decade has gathered gathered has decade last the over opened has class reserves, quality assets, low-cost operating
may then be that individuallyiron ompetitivepig and DRI/HBI as such feedstocks constructionprocessedpulp further millcosts, would developed be among the lowestDampier cost and Onslow region of northwest Western Australia. The "window of opportunity" for virgin metallic metallic virgin for copportunity" of "window The opportunity condensate 6 gigalitres (38 million barrels) withto obtain several high-quality play types and premium-priced in under-exploredproducers in the Asianed region. The study infrastructure and an open economy and a Among the most significant gas/condensate productionKey locationsfields chemical products. are the Apachegas Energy operated 26 East giga Spar cubic and Wonnichmetres fields, (934 billion cubic feet) stable Government. found that the relative competitiveness of a areas having one billion barrel-plusestern Australian milland was thelikely Goodwyn, to increase North Rankin, Perseus, Echo/ Yodel and W effi ciencies, and a culture built on innovation and estern Australia is close to growing Wanaea fields operated by Woodside in the Carnarvon Basin. W significantly against its regional competitors. Asian markets; it is politically stable and Other significant operators in the region include BHP Billiton potential. PetroleumPe operatingtroleum the Griffin/Chinook/Scindiandemand fields and has an emerging petrochemical industry Chevron managing the massive Gorgon field. that offers further potential synergies with While a considerable exporter of coal and LNG, Australia’s leading-edge technology. other resource industries. Natural gas and rapidly expanding economy and declining domestic oil olefins feedstock prices are internationally production have led some observers to forecast an energy competitive. supply shortfall in the next 10 years, particularly in oil and condensate. Western Australia, already the nation’s largest producer of both oil and gas, is a likely source of additional petroleum to meet this demand. A number of petrochemical projects including gas-to- liquids could also provide significant opportunities for the downstream processing of Western Australia’s vast gas reserves. Western Australia has more than 5000 km of offshore and onshore pipelines under licence as well as ports capable of exporting LNG and other petroleum products. Basins of Opportunity Western Australia has extensive onshore and offshore sedimentary basins, the majority of which are considered prospective for new petroleum discoveries. As a relatively new hydrocarbon province, opportunities for newcomers are still available in Western Australia. 23 www.woodside.com.auProspect Cliff Head oil reaches Kwinana refinery
Product from the oil field is piped to a storage facility behind the sandhills south of Dongara, and then placed in road takers for the journey to the BP’s refinery 27% at Kwinana for processing. Production 32% started at an initial flow rate of 10,000 barrels per day and is expected to reach a peak of about 15,000 barrels per day around September 2007. The total oil reserve at Cliff Head has been estimated Oil aboard: A double road tanker, with crude oil aboard at 14 million barrels (2P). 12% from the new Cliff Head oilfield, arrives at BP’s Kwinana 29% refinery for processing. Total capital investment in the project, to the first oil stage, has been put at Western Australia’s crude oil self- $265 million. sufficiency has been boosted by the Other parts Australia 12% The BP refinery recently opened a $6.4 South East Asia 29% commencement of production from WA North West Shelf 32% the Cliff Head oil field near Dongara. million facility to accommodate in- Middle East 27% coming oil supplies from Cliff Head, and Crude oil sourced by BP Cliff Head is the first commercial also provide a route to market for other offshore oil field in the Perth Basin, and a smaller oil fields. welcome new source of oil for the State. The Cliff Head oil field, operated by Located 11 km from the coast, Cliff ROC Oil on behalf of the Cliff Head “Today it is still at the heart of the Head was discovered towards the end of Joint Venture, is expected to provide Western Australian economy, providing 2001, and declared a commercial field in approximately 10 per cent of the crude oil fuels for a variety of industries,” said the October 2003. that BP uses to manufacture LPG, petrol, refinery’s managing director, Thys Heyns. diesel, aviation and marine fuels as well
N as bitumen. Australia is about 70 per cent self
Dongara sufficient in oil, although Western In 2005, independent economic Australia imports less oil than the consultants ACIL Tasman concluded eastern States of Australia. The varying that the BP oil refinery in Kwinana characteristics of crude oil mean that was a significant contributor to supplies sourced by BP refinery come Western Australia’s economy, from various parts of the world, with contributing one per cent of the total about 32 per cent coming from Western Gross State Product, and representing Australia’s North West Shelf, about 12 Indian Jingemia around 11 per cent of the State’s Ocean oilfield per cent from other parts of Australia manufacturing sector. (mainly the Perth Basin), 29 per cent from South East Asia and 27 per cent When the Kwinana oil refinery opened from the Middle East. Arrowsmith plant in 1955 it was the first major industrial Pipeline development project in Western Australia Cliff Head outside the State’s gold and coal oilfield 0 5km industries.
24 Prospect Western Australia’s “dog bolter” resources sector
The value of mineral and petroleum Western Australia’s resources in order of value (and percentage gain) for 2005: production in Western Australia hit Commodity value value % quantity % a record $38.9 billion in 2005, a A$billion increase increase rise of 37 per cent over the previous year. Crude Oil and Condensate $8.74 40 5 LNG $4.32 37 29 It was achieved as a result of strong overseas demand for Western Australia’s Iron Ore $11.3 83 13 resources, increased outputs and rising Alumina $3.66 15 3 commodity prices. Nickel $3.43 5 8 Petroleum and iron ore sales (up 37 Gold $3.13 6 3 per cent and 83 per cent respectively) accounted for about two-thirds of the Diamonds $.727 75 42 total production gains for 2005. Minerals sands $.817 9 The results for petroleum, with an Base metals $.456 108 increase in sales of $3.9 billion to Salt $.222 20 10 reach a record level of $14.3 billion, reaffirmed its position as the State’s Copper $.354 120 97 most valuable commodity. Petroleum Lead $.025 7979 2293 also raised Western Australia’s share of Australia’s oil and condensate Zinc $.076 32 15 production from 64 per cent to around 70 per cent. which sold a record 244 million tonnes expansions on the drawing board Western AGC Half Page ad 22/5/06 12:31 PM valuedPage 1at $11.3 billion, up 13 per cent and Australian iron ore exports are likely to The next largest industry was iron ore, 83 per cent respectively. With more mine grow further.
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Strong Aboriginal involvement Koolan Island in the rebirth of Koolan Island
The rebirth of one of Australia’s most historic iron ore mines, at Koolan Island in Yampi Sound near Derby, will deliver strong employment opportunities for local Aborigines.
The mine, which previously produced 68 million tonnes of high grade (67% Fe) iron ore between 1959 and 1993, will soon be back in production for its new owners Aztec Resources Limited.
The company has already started employing some local Aborigines, and has set a goal of having 30 per cent of its 220 person workforce filled by indigenous people by the time the mine enters its eigth year of production.
This employment pledge is part of a “co- existence deed land access agreement” between the traditional owners of the island, the Dambima-Ngardi people, and Aztec Resources which was signed in April.
Aztec Resources Chairman Ian Burston said the agreement was built Land access agreement: Aztec Resources Chairman Ian Burston (left) with the Minister for Indigenous Affairs Sheila McHale around understanding, trust and most and Kimberley Land Council representative Cameron Syme (right) in the background, witness the signature of traditional importantly, cooperation. owner Janet Oobagooma at the recent signing of the land access agreement on Koolan Island. About 50 local Aborigines attended the ceremony. He said that in a tight labour market, cent Fe, the mine is expected to resume it was important for industry, the mining activities in the third quarter indigenous community and Government of 2006, with the first exports of the to cooperate to improve the skills of local Koolan Island people rather than looking offshore to fill mine’s premium iron ore due by the end these positions. of the year. The company has supply Memorandums of Understanding with “The co-existence deed is a whole-of- both Chinese and Japanese steel mills. project approach, and will extend to contractors employing indigenous people The mine is expected to have an annual involved in the rebirth of the Koolan production rate of 4 Mt/a over the next Island iron ore mine,” Mr Burston said. nine to 10 years.
The Koolan Island iron ore deposits are The cost of getting the Koolan Island among the richest in Australia. With a mine back into production was been current resource of 53.5 Mt at 64 per estimated at $125 million.
27 Prospect www.doir.wa.gov.au info Bookings: Function Centre available 7days Video Conferencing Corporate Team BuildingDays Board Meetings Conferences /Seminars A popularfacility for: Function Centre Technology Park Located just6kmsfromPerth CBD oppositeCurtinUniversity Beautiful parklandsettingwithbarbecuefacilities Ample freeparking Tennis courtandbasketballhire Licensed bistrowithindoorandoutdoordining State-of-the-art audiovisualandcommunicationfacilities 16 seatboardroom A selectionofseminarroomsseating20-300people 80 seattheatrewithaudiovisualequipment @ techparkwa.org.au (Mon to Fri 9-5pm) Product Launches . - + , - * !"#$%&$'#( ) 9451 0888 Cocktail Events + Workshops www.techparkwa.org.au Fax: 93614077 Bentley WA 6102 2 Brodie HallDrive
DoIRFEB06_612 $700 million Burrup ammonia plant is officially opened
The world’s largest greenfields ammonia plant, on the Burrup Peninsula in north-western Australia, was officially opened by Western Australia’s Premier Alan Carpenter in April.
With an annual production capacity of 760,000 tonnes of liquid ammonia, the plant was developed over a four-year period by Burrup Fertilisers Pty Ltd at a cost of about $700 million.
The project represents the largest ever Indian-based investment in Australia.
The first shipment of liquid ammonia left the port of Dampier in June bound for India where it will be used for the manufacture of fertilisers.
Burrup Fertilisers is currently examining the feasibility of increasing the plant’s capacity so it can produce urea and ammonia nitrate.
The ammonia plant is the first downstream processing project to be commissioned within a newly created gas processing precinct on the Burrup Peninsula, and the Western Australian Government welcomes further interest from investors to share some of the common-user infrastructure in that area.
Production under way: Above, Western Australia’s Premier Alan Carpenter (right) on a recent visit to Burrup Fertilisers’ recently commissioned $700 million liquid ammonia plant. He is pictured with Department of Industry and Resources Project Manager Walter Law (left) and the Managing Director of Burrup Fertilisers Pankaj Oswal. The pictures on the right show the sophistication of the world-scale ammonia plant.
29 Prospect THE BIG PICTURE Economic trends
12
10 China
8 World economic activity Economic growth in major countries 6 World economic activity is likely to remain in 2006 US strong in 2006, as the IMF expects the world US economy 4 to grow by 4.9 per cent for the year, down Percent The US recorded a 3.5 per cent growth in slightly from 4.8 per cent in 2005. 2 Euro area 2005, with particularly strong growth in The Chinese economy is expected domestic investment (in residential and to continue its very solid economic 0 non-residential areas). Preliminary data Japan performance. It is so strong that the World showed that economic activity continued -2 Bank (2006) is urging Beijing to take more to be robust in Q1 2006. The 4.8 per cent * * 1998 steps to limit its growth. The economy will annualised increase reflected growth in 2000 2002 2004 2006 2007 US Euro area Japan China continue to demand commodities, and personal consumption, equipment and Growth in the major economies maintain high prices (though the rates of software, exports and government spending Source:Australian IMF and World Dollar Bank. *Figures exchange are forecasts rate against increases are falling). (US DoC 2006). major currencies 95 0.85 Forecasts for the world’s largest economy, However, activity for the rest of 2006 90 the US, and countries which Western is expected to weaken in response to a 0.80 number of factors. These include: reduced Australia trades with, such as India and 85 East Asia, are also favourable. Japan and spending on reconstruction after Hurricane 0.75 Euro area are expected to recover slowly in Katrina; an anticipated cyclical downturn in 80 0.70 2006. residential investment; reduced household wealth gains; and lagged effects of 75 0.65 The main risks to the global economy successive interest rate rises to 5 per cent 70 continue to be: the US’s large budget since June 2004 (ANZ 2006). TWI, Yen 0.60 US$, Euro and current account deficits; inflationary 65 In spite of these, underlying US economic pressures, arising from high oil prices; and 0.55 60 the possible onset of an avian flu pandemic. growth is robust. Private consumption is supported by strong employment and While the former two risks could reduce 55 0.50 economic activity by increasing world rising wage growth; while businesses are interest rates; the latter risk could do so by supported by increases in productivity and 50 0.45 investment in equipment and software (ANZ drastically reducing trade and investment. Jul 2003 Jul 2004 Jan 2003 Jan 2004 Jul 2005
2006 and AFR 2 May 2006). Jan 2005 Jan 2006 TWI Yen US$ Euro World growth in 2005 The IMF, which has taken into account Australian Dollar exchange rate against uncertainty in the US housing market and Australian Dollar exchange rate against The IMF (2006) increased its global GDP major currencies Source: Reserve Bank of Australia growth estimate for 2005 by 0.5 percentage its effects, forecasts US economic growth of 3.4 per cent in 2006. points projected last September to 4.8 per 160 cent. This is due to stronger than expected global economic activity in the second Japanese economy 140 half of 2005, particularly among emerging Japan’s GDP grew by 2.7 per cent in countries, and statistical revisions to 2005 due largely to export growth and a Chinese national accounts. depreciation of the yen (IMF 2006). GDP 120 growth in the March quarter 2006, to be Robust activity in China, India and Russia released in mid-May, is expected to be 100 accounted for two-thirds of the upward slow because of markedly weak consumer revision to world growth. In general, world spending (AFR 2 May 2006). industrial production rose substantially 80 from mid 2005, while consumer and Recently, the Bank of Japan argued that its business confidence is strengthening in country’s balance of risks has now moved 60 major developed countries such as the from deflation to inflation. Japan is now United States, Japan and Euro area. on the road to recovery after more than a 40 Jun 2000 Jun 2001 Dec 2000 Dec 2001 Dec 2002 Dec 2003 Dec 2004 Dec 2005 Mar 2005 June 2002 June 2003 June 2004 June 2005 US Euro area Japan Australia 30 Major stockmarket indices Source: Reserve Bank of Australia Prospect decade of poor economic activity. Despite largely as a result of growth in exports and - due partly to a correction from the the current weak consumer spending, investment in machinery and equipment. unexpectedly strong growth recorded there are positive signs, including firming For the first months of 2006, GDP increased in the previous quarter. Also, recent employment and wage growth, strong by 6.3 per cent year-on-year, with exports indicators such as consumer and business exports, industrial production and business up by 11.5 per cent led by automobile and IT confidence suggest that activity is expected conditions. The March Tankan survey of products (BoK 2006). to strengthen in 2006 (ECB 2006). The IMF manufacturing and non-manufacturing (2006) expects Euro area to grow by 2.0 per business conditions recorded solid levels, Growth is expected to reach 5.1 per cent cent in 2006. and the outlook for capital spending is also in 2006 as consumption and investment solid (AFR 5 April 2006). increase, along with an expected double- The German economy grew by only 0.9 per digit export growth – again to be led by IT cent in 2005. While exports and industrial Japan is forecast to grow by 2.8 per cent in products (ADB 2006). production rose, domestic demand was 2006 (IMF 2006). particularly weak. Household consumption The Indian economy recorded a GDP growth is expected to remain weak until Non-Japan East Asia rate of 8.1 per cent growth between 1 employment conditions improve. However, April 2005 and 31 March 2006 (FY2005). Its there are encouraging signs with business Chinese economy services sector which makes up 54 per cent confidence at a 15 year high and export- of economic output grew by 9.8 per cent; orientated industries performing strongly The Chinese economy, now the world’s while its industry sector which makes up (IMF 2006 and AFR 11 May 2006). fourth largest, expanded by 9.9 per cent 25 per cent of GDP grew by 9.0 per cent in 2005, following a 10.1 per cent rise in Economic growth is forecast at 7.6 per cent The German Government has recently 2004. Activity in 2005 was led mainly by in FY2006, with the services and industry raised Germany’s GDP forecast for 2006 very strong exports and investment in sectors somewhat affected by higher fuel from 1.4 per cent to 1.6 per cent, while the manufacturing (AFR 1 March 2006 and prices following the Government’s decision country’s six leading economic research IMF 2006). to raise prices to international levels (ADB institutes has forecast 1.8 per cent. The country continues to struggle with rising In March quarter 2006, China recorded 2006). health-care costs and high unemployment a higher than expected growth rate of Singapore and Hong Kong grew by 6.4 (IW 2 May 2006 and Economist 5 May 2006). 10.2 per cent year-on-year, with foreign and 7.3 per cent respectively in 2005. The trade being the main contributor. Current main contributor to Singapore’s growth In 2005, the United Kingdom recorded a favourable economic conditions in the world was exports of IT and telecommunication GDP growth rate of 1.8 per cent, the lowest suggest that China would continue to grow products. Exports were also a key driver of for 13 years. Spending by households fell strongly via its exports and investment growth in Hong Kong, which partly reflects because of higher energy prices, tightening (AFR18 April 2006). China is forecast to monetary policy and the cooling house grow by 9.5 per cent in 2006 (IMF 2006). Hong Kong’s function as an exit point for exports from China. Activity is expected to market. In the first 3 months of 2006, GDP Fearing an overheating economy (that rise by 6.1 per cent in 2006 for Singapore grew by 0.6 per cent due mainly to higher may potentially generate inflation and in response to favourable world market private consumption and trade (NSUK 2006, later deflation), the Chinese Government conditions, especially an upturn in global ECB 2006 and IMF 2006). has already placed limits on fixed-asset electronics and a recovery in domestic For the remainder of 2006, economic investments in industries with overcapacity demand. In Hong Kong, GDP growth is activity is expected to strengthen in such as the steel, aluminium, coke and forecast to slow to 5.5 per cent in line with response to a recovery in consumer automobile. The other potential problem a slight moderation in China’s activity and spending and government spending. The industries are cement, coal, electricity and rising interest rates (ADB 2006). United Kingdom’s GDP growth is forecast textiles (AFR 22 March 2006). Europe at 2.5 per cent in 2006 (IMF 2006 and The Government is also trying to reduce NIESR 2006). Economic activity in the Euro area grew the country’s reliance on exports (and Note: investment) as the engines of growth by by 1.3 per cent in 2005 because of weak encouraging domestic consumption via cuts consumer spending and exports (as a result Asian Development Bank (ADB); Australian Financial in the costs of education, medical care and of a high Euro dollar which reduced its Review (AFR); Bank of Korea (BoK); European Central Bank export competitiveness) (IMF 2006 and AFR (ECB); Industry Week (IW); International Monetary Fund housing (AFR 10 March 2006). (IMF); National Institute of Economic and Social Research 11 May 2006). This weakness, particularly (NIESR); National Statistics United Kingdom (NSUK); and US Korean GDP grew by 4.0 per cent in 2005 in the December quarter 2005, is temporary Department of Commerce (USDoC).
30 31 Prospect Prospect THE BIG PICTURE Commodity Outlook
4000
3500 Commodity Outlook that the median duration of commodity booms and slumps are approximately four 3000 The non-rural component of the Reserve years. However, this study includes many Bank of Australia’s commodities index, agricultural commodities. The IMF analysis 2500 which is comprised entirely of Australian suggests that, for selected mineral and 2000 exported mineral and petroleum petroleum commodities, the shortest lived commodities, is at a record high. The non- US$/t price shocks have typically lasted five to 1500 rural component began its current upward eight years. Some shocks, such as those trend, without experiencing a subsequent experienced in crude oil markets, never significant trend reversal, in January 2004. 1000 die out. These commodities remain at their The record high has been continually current level until another price shock 500 revised since April 2005 which eclipsed the knocks the prices higher or lower. previous record set in September 2001. The 0 current record is 45 per cent higher than The key issue is whether the world will the September 2001 record.
experience significant negative or positive 10 Jul 03 10 Jul 05 10 Apr 04 10 Jan 04 10 Jan 05 10 Jan 06 10 Jun 04 10 Sep 03 10 Sep 04 10 Sep 05 10 Nov 03 10 Nov 04 10 Nov 05 10 Nov 10 Mar 04 10 Mar 05 10 Mar 06 10 May 03 10 May 05 10 May 06 commodity price shocks in the near future. The non-rural component of the RBA’s Given the apparently widespread imbalance AustralianZinc DollarLead exchange rate against commodity index exhibited a relatively between demand and supply, there may be major currencies horizontal trend from May 1985 to February Lead and Zinc prices a risk of prices in some commodity markets Source: LME Cash Official 2005, with evidence of increased volatility reaching a point where it becomes demand 3400 from 2000. The period since then has exhibited a pronounced upward trend. destroying followed, possibly, by a plunge in 3200 spot prices. 3000 A frequently cited reason for the upward 2800 increase in commodity prices is the world- Is this scenario likely? An article published wide reduction in spare capacity in mineral in the Commonwealth Treasury’s spring 2600 2005 edition of the Economic Roundup and petroleum production. Commodity 2400 states that mining export prices are prices will continue to remain high while 2200 world-wide demand remains higher than highly pro-cyclical, with absolute price 2000 the world’s ability to satisfy that demand. falls common during slowdowns in global US$/t economic activity. Ahead of any slow-down, 1800 two important factors to watch for are In looking for reasons why commodity 1600 demand is high relative to supply capacity, evidence of financial fragility among key 1400 it is apparent that China’s demand for commodity consumers and producers’ commodities is increasing while demand ability to pass on price increases. 1200 from the rest of the world remains relatively 1000 stable. This may provide part of the Crude Oil explanation. However, uncertainty about the 11-Feb-02 11-Feb-03 11-Feb-04 11-Feb-05 11-Feb-06 11-Nov-02 11-Nov-03 11-Nov-04 11-Nov-05 11-Aug-02 11-Aug-03 11-Aug-04 11-Aug-05 11-May-03 11-May-04 11-May-05 11-May-06 In the March quarter Australian Commodities 11-May-02 precise causes of the increased demand, the the Australian Bureau of Resource robustness of that increased demand and the AluminiumAustralian Dollardaily prices exchange rate against Economics (ABARE) published 2006 forecast Source: LME Cash Official supply response between the world’s major major currencies of nominal West Texas Intermediate crude producers may have inhibited a more timely In its April 2006 Oil Market Report the expansion of production capacity. oil price is set at US$59.69/bbl. The years out to 2011 show a steady decline to International Energy Agency (IEA) stated that world oil supply fell in March with While production capacity is expanding, US$43.14/bbl. The 2006 forecast price has it is not clear whether the expansion is been upgraded by 38 per cent from ABARE’s OPEC; North American and North Sea sufficient to slow the rate of increase June quarter 2005 forecast for 2006 of production outages outstripping higher in commodity prices. The International US$45.47/bbl. March quarter commentary non-OECD production. The continuing Monetary Fund (IMF) forecasts robust highlights a marked increase in non- tight supply conditions leave petroleum economic growth for the foreseeable future. OPEC oil production, particularly from the markets susceptible to price instability. A number of IMF studies have analysed past Russian Federation, Africa, the Caspian The director of the IEA, Claude Mandil, Sea region and Latin America. Despite commodity price fluctuations. Those studies was reported in the Australian Financial generally indicate strong persistence the increase, supply disruptions mean Review as saying that “fossil fuel markets of price “shocks”. In the long-run, this that non-OPEC production has remained translates to small trends and a large largely unchanged. ABARE also points to were caught in a vicious cycle as higher amount of price variability. These shocks high utilisation rates in downstream world prices and stretched capacity encouraged are by their nature random, unpredictable refineries ranging from 94 per cent in Japan nationalistic governments and groups events. One IMF staff paper indicates to 90 per cent in Europe and the US. with political aims to seek gains from
32 33 Prospect Prospect 9000 8500 8000 7500 Chinese “apparent demand” increased by 4 Nickel 7000 per cent year-on-year in February. However, 6500 the IEA expects Chinese demand growth to The nickel price is near a record high at 6000 be lower than projected in the first quarter A$24,395 per tonne in April. This is close 5500 to the previous high of A$25,009 set in 5000 2006 due to China’s energy market rapidly US$/t returning to balance after a period of high April 1988. Three-month contracts reached 4500 US$20,000/tonne in the electronic platform 4000 demand relative to supply. This should of the London Metal Exchange (LME) 3500 reduce demand for oil as an energy source after oscillating between US$19,900 and 3000 in electricity generation. 2500 US$19,970. This is the highest nickel price 2000 Iron ore since it was first quoted on the LME in April 1500 1979. Average nickel prices have increased 1000 In the absence of contract prices for iron by 23 per cent in US dollar terms since ore, this section reports analysis of the January 2006. According to NYMEX the longer term trends for iron ore. ABARE’s
10-Jul-03 10-Jul-04 10-Jul-05 value of a single United States Nickel is now 10-Jan-03 10-Jan-04 10-Jan-05 10-Sep-03 10-Sep-04 10-Sep-05 10-Nov-03 10-Nov-04 10-Nov-05 10-Mar-03 10-Mar-04 10-Mar-05 10-May-03 10-May-04 10-May-05 10-May-06 analysis indicates that world seaborne trade worth more than its face value. The latest Copper prices in iron ore is projected to reach 882 million surge in price was attributed mainly due to Source: LME Cash Official tonnes by 2011. This represents a 34 per delays in production in New Caledonia. cent increase on ABARE’s 2005 estimate. Inspection of price data suggests the nickel 75 Australian iron ore exports are projected to market has trended sideways increase by 56 per cent to reach 375 million since May 2003 ranging between tonnes by 2011. This represents 43 per 65 A$12,873 per tonne and the current high cent of total world seaborne trade, up from with rapid price appreciation followed by 37 per cent in 2005. Thus, ABARE expects rapid price plunges. Despite the volatility 55 Australia to remain the largest seaborne exporter of iron ore, followed by Brazil. India the average price has been relatively high in recent years. 45 is notably expected to begin decreasing its seaborne exports from this year.
Percent The expected supply response is slowly 35 Inspection of demand side projections building. ABARE reports that world nickel suggests Japan and the Republic of Korea mine production should increase by 5 per cent this year followed by a further 6 25 will continue to increase imports while Taiwan’s imports are expected to remain per cent next year, albeit largely confined flat. China’s imports are expected to to just three nickel projects. Thus, the 15 grow strongly, with China’s share of total nickel market remains susceptible to seaborne imports accounting for 51 per production delays in these projects. In total, cent in 2011, up from 42 per cent in 2005. ABARE reports that there is an expected 10-Jan-03 10-Jan-04 10-Jan-05 10-Jan-06 10-Sep-02 10-Sep-03 10-Sep-04 10-Sep-05 10-May-02 10-May-03 10-May-04 10-May-05 10-May-06 Imports from the rest of the world are also 252,000 tonnes of major nickel laterite Oil prices Source: EIA (Official Energy Statistics from the US Government) expected to continue growing. production capacity expected over the period 2006 to 2011. actions that threatened to further China’s growing share of world demand for iron ore increases the significance of increase prices”. Base Metals events and trends in the Chinese steel industry. One of the key issues raised by The spot copper price continued trending North American demand was relatively weak analysts, including ABARE, is the need upwards, increasing by 25 per cent from in Q1 2006. The IEA expects US demand to for consolidation. Currently, China has February to reach an average US$6388/t pick up in the second half of 2006, but flags approximately 1500 steel producers with in April. The latest May spot price set at higher oil prices as a possible reason for only 26 mills with annual output greater US$7748/tonne is another 21 per cent continued weakness. Use of oil in power than 3 million tonnes. To remedy this higher than the April average. In contrast generation increased substantially in Japan, situation, the Chinese government’s to copper, average lead prices have eased which the IEA suggests may be due to a 24 Development Policy for the Steel Industry back since February. The latest spot price per cent year-on-year decline in LNG use has set a goal for the largest 10 steel mills at US$1209/tonne is higher than April’s in power generation and a 12 per cent drop in China to account for 50 per cent of total average US$1170/tonne. It remains to be in hydropower. Within the remainder of the output by 2010 and 70 per cent by 2020. seen whether this recent surge is sustained. OECD bloc, Europe is the only region that the The policy, if effectively implemented, Zinc is currently trading at US$3421/tonne IEA expects to see an increase in oil should also engender financial stability after trending up substantially over the past use in Q1 2006. within the industry. two months.
32 33 Prospect Prospect PROSPECT Reaches 10,000 decision makers in the resources sector every quarter
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34 Prospect Significant resource projects underway Visit us online or planned in Western Australia
Western Australia continues to lead the way as Australia’s No.1 Prospect can be downloaded free of resources investment destination, with more than $67 billion worth charge from the Internet by visiting the of projects either underway or planned for the State over the next few website of the Department of Industry years. This will bring tremendous benefits to the State including more and Resources at: www.doir.wa.gov.au than 32,000 additional construction and 9000 full-time jobs.
Project Employment value Prospect (estimated A$m) Construction Permanent Iron and steel Subscription/Change of address ABN: 69 410 35 356 BHP Billiton’s future growth strategy 4245 900 150 Mt Gibson/Asia Iron’s Extension Hill magnetite project 715 400 300 Fortescue Metals Group’s mine, rail and port proposal 2500 1500 300 Gindalbie Metals’ mine and pellet plan 720 200 175 Name: Grange Resources’ Southdown magnetite mine 560 n/a 200 Hope Downs Limited’s iron ore mine 1500 1000 300 HIsmelt’s pig iron and steel plant 800 320 65 Midwest Corp’s Koolanooka mine and pellet plant 1000 1200 270 Midwest Corp’s Weld Range mine 800 900 220 Position: Mineralogy’s Cape Preston mine and pellet plant 1400 2000 400 Robe River’s mine, rail and port upgrades 302 450 70 Robe River’s West Angelas mine expansion 217 200 300 Organisation: Robe River’s rail duplication program 200 n/a n/a Hamersley Iron’s Yandicoogina expansion 700 330 650 Sub total 15659 9400 3200 Address: Nickel/cobalt Heron Resources’ Goongarrie mine and plant 1400 1000 300 BHP Billiton’s Ravensthorpe mine 1800 1400 350 Sub total 3200 2400 650 Petrochemicals Type of business: CSBP Chemical’s Kwinana ammonia nitrate plant 200 n/a n/a Dampier Nitrogen’s ammonia-urea plant 900 1000 130 Deepak Fertilisers’ ammonia nitrate plan 399 700 150 Phone number: Sub total 1499 1700 280
Oil, gas and condensate Email Woodside’s Enfield oil development 1480 100 80 Chevron’s Gorgon gas/condensate development 11000 3000 600 Please tick the appropriate box Woodside’s Vincent oil development 1000 n/a n/a Please add me to your mailing list to receive Prospect magazine. I would like a subscription for Inpex’s Ichthys LNG Project 8000 3000 500 one year @ $12 (incl. GST) Woodside’s Angel gas/condensate development 1600 n/a n/a two years @ $22 (incl. GST) North West Shelf JV’s LNG Train-5 2000 1500 20 three years @ $32 (incl. GST) BHP Billiton’s Onslow LNG plant 5000 2500 150 Santos’ Tern–Petrel gasfield development 1000 n/a n/a Woodside’s Pluto LNG plant 5000 1500 150 My cheque made out to the Department of Industry and BHP Billiton’s Stybarrow oil development 815 n/a n/a Resources, is enclosed OR please debit the amount to my credit card using the following details: Sub total 36895 11600 1500 Other Type of card: Visa Bankcard Mastercard Alcoa’s Wagerup refinery Train-3 expansion 1500 1000 150
Worsley Alumina’s Boddington refinery expansion 900 500 150 Expiry date Argyle Diamonds’ underground mine 1200 250 500 This form will become a tax invoice for GST purposes when payment is made. BGM’s Boddington Wandoo gold mine expansion 2000 1000 500 Change of address Griffin Energy’s Bluewaters coal-fired power station 400 600 50 (please make changes required on one of your old labels). Lyondell’s titanium dioxide pigment plant expansion 470 500 200 Ord irrigation (Stage 2) project 600 650 550 Please photocopy or cut coupon and mail to: Transfield’s gas turbine power plant 260 n/a 400 Prospect subscriptions Information Centre Birla’s Nifty underground mine 200 160 90 Department of Industry and Resources Lignor’s engineered strand lumber project 250 400 140 Mineral House, 100 Plain Street Sundry projects — at least another 3000 2000 300 East Perth, Western Australia 6004 Sub total 10680 7060 3180 TOTAL 67933 32760 9010 Commissioned Projects Committed Projects (as at 18/5/2006) (as at 2005/2006)
Ammonia/Urea Ammonium Nitrate ore shipment in late 2006. Expenditure: $125m. Kwinana - Ammonium Nitrate Plant & Expansions Burrup Peninsula - Ammonia Plant Employment: Operation: 220 BURRUP FERTILISERS PTY LTD CSBP CHEMICALS Koolyanobbing - Iron Ore Project On 19 April 2006, Burrup Fertilisers announced the CSBP Limited has environmental approval to double the completion of construction and commissioning of its capacity of its existing ammonium nitrate facility at its PORTMAN LIMITED Kwinana operations. Construction has commenced and ammonia plant at the King Bay/Hearson Cove industrial In October 2004, the Portman Board approved an the objective is to achieve commissioning by mid-2007. area on the urrup Peninsula, near Karratha. Around expansion of its Koolyanobbing operations to increase Expenditure: $200m. iron ore production from 5 Mt/a to 8 Mt/a. This expansion 760,000 t/a of liquid ammonia will be produced and is primarily driven by the “Northern Tenements” exported to India and other world markets for the Copper resources at Windarling and Mt Jackson. The upgrade manufacture of fertilisers. Norsk Hydro is the shipping Nifty (Throssell Range) - Nifty Copper Underground Mine in expansion capacity is expected to be completed in Q2 and marketing agent for the ammonia produced. The 2006. At the expanded rate of 8 Mt/a, Koolyanobbing is Harriet Joint Venture has an agreement to supply 82 BIRLA (NIFTY) PTY LTD expected to have a mine life of 11.5 years, based on a TJ/d of natural gas to the project. In April 2005, Yarra Birla is currently expanding the Nifty Copper Operation in reserve estimate of 91.8 Mt. International, a Norwegian fertiliser company, bought a the East Pilbara region of WA to include an underground Expenditure: $80m. 30% shareholding in this ammonia plant. mining operation from the base of the existing open cut. The expansion will include an on-site processing facility Mid West Region - Koolanooka/Blue Hills Hematite Expenditure: $700m. to produce copper concentrate. This will be trucked to Iron Ore Mine Employment: Construction: 1100; Operation: 100 Port Hedland and shipped from an 18,000 tonne capacity MIDWEST CORPORATION LIMITED storage facility to be built by Birla on land leased from the Bauxite/Alumina Port Hedland Port Authority. The underground mine will Midwest Corporation commenced transporting the fines have an annual throughput of 2.5 Mt with an extension to stockpiles at Koolanooka, about 160 km south-east of Bunbury - Worsley Alumina - Bunbury Port Facilities the life of mine of 10-12 years. Geraldton, early in January 2006 and the first export shipment occurred late February 2006. The company has WORSLEY ALUMINA PTY LTD Expenditure: $200m. approval to transport the ore by truck to Geraldton port Worsley Alumina has completed the construction of a Employment: Construction: 160; Operation: 90 for a limited period, after which time it is to switch to rail radial arm alumina loading and caustic soda unloading transport, if viable. Midwest further proposes to re-open facility at the Port of Bunbury to service its expanded Electricity the Koolanooka and Blue Hills hematite iron ore mines at production needs. The Berth 6 facility is now being Collie - Bluewaters Coal-Fired Power Station an initial rate of 1 Mt/a. Hard rock mining is expected to commissioned. commence at Koolanooka in mid-2007 and at Blue Hills GRIFFIN ENERGY in 2008. Expenditure: $50m. Griffin Energy has commenced construction of the first Expenditure: $26.4m. Employment: Construction: 100 of two 208 MW coal-fired power stations at the proposed Coolangatta industrial estate, 10 km north-east of Collie. Employment: Construction: 40; Operation: 60 Pinjarra/Huntly - Alumina Refinery Efficiency Commissioning of Bluewaters 1 Base Load Power Station Pilbara - Rail Duplication from Tunkawanna to Upgrade to 4.2 Mt/a is expected by late 2008. Rosella Siding ALCOA WORLD ALUMINA AUSTRALIA Expenditure: $400m. ROBE RIVER MINING COMPANY PTY LIMITED Alcoa has completed the construction of its efficiency Employment: Construction: 600; Operation: 50 Robe River Mining is currently expanding the capacity of upgrade of its Pinjarra alumina refinery to increase its rail facilities by the duplication of Hamersley Iron’s capacity by 0.6 Mt/a to a total 4.2 Mt/a. The new capacity Gold railway between Tunkawanna Creek and Rosella Siding, will be brought on line over the next few months. Boddington - Gold Mine (Wandoo Expansion) which is operated by Pilbara Iron Pty Ltd on behalf of Expenditure: $440m. BGM MANAGEMENT COMPANY PTY LTD Robe River and Hamersley Iron. Expected completion is Employment: Construction: 1000 BGM Management Company Pty Ltd, on behalf of mid-2006. Newmont and AngloGold Ashanti, is developing the $2 Expenditure: $200m. Worsley - Worsley Refinery Expansion to 3.5 and billion Wandoo project, based on mining the extensive Pilbara - Rapid Growth Project 2 then 3.7 Mt/a bedrock resource that underlies the mined-out oxide BHP BILLITON IRON ORE PTY LTD WORSLEY ALUMINA PTY LTD resource. Production will be up to 600,000 oz/a of gold and about 20,000 t/a copper in concentrates over a 15- In October 2004, BHP Billiton announced Board approval BHP Billiton’s Worsley alumina refinery has completed year mine life. Initial production is expected by late 2008. for the US$575 million Rapid Growth Project 2 (“RGP2”) a Development Capital Program to expand capacity to The Wandoo project will result in significant growth in and which will increase production capacity of its Pilbara iron 3.5 Mt/a . This additional capacity is being brought on around the small rural community of Boddington 120 km ore operations to 118 Mt/a in the second half of 2006. stream progressively during 2006. Worsley also has south-east of Perth. Expenditure: $745m. environmental approval to expand production to 3.7 Mt/a, Expenditure: $2b. Pilbara - Rapid Growth Project 3 and this will be achieved over time by production creep. Employment: Construction: 1000; Operation: 650 Expenditure: $257m. BHP BILLITON IRON ORE PTY LTD In October 2005, BHP Billiton announced Board approval Employment: Construction: 100 Heavy Mineral Sands for the US$1.3 billion Rapid Growth Project 3 (“RGP3”) Waroona - Heavy Mineral Sands Mine expansion, which will increase capacity of its Pilbara iron Electricity ILUKA RESOURCES LIMITED ore operations to 129 Mt/a. The key elements of RGP3 Pinjarra - Gas Fired Cogeneration Power Project Iluka Resources announced in March 2006 capital comprise the expansion of Area C, additional sidings on approval by its Board for the development of the Waroona the Newman railway and port works at Nelson Point and ALINTA mineral sands mining operation. The orebody is located Finucane Island. Initial production is forecast to begin in Alinta has completed the first of its two 140 MW gas- near the township of Waroona, approximately 80 km Q4 2007, with actual production of 129 Mt/a anticipated fired cogeneration units at Alcoa’s Pinjarra alumina north of Iluka’s North Capel operations, and will supply by 2008/09. refinery site. The units will provide Alcoa with process feedstock into its Capel operations. Waroona is expected Expenditure: $1.7b. to commence production in the first quarter of 2007, heat for current and future capacity increases, as well Employment: Construction: 900; Operation: 150 as electricity for sale in the local market. Unit 2 is under subject to environmental approvals. The deposit contains construction and is expected to be completed in the last a proven reserve of 8.4 Mt of ore at a heavy mineral grade Yandicoogina - Mine Expansion quarter of 2006. of 10.2%. Over its estimated three year life, Waroona HAMERSLEY IRON PTY LIMITED is forecast to produce approximately 32,000 tonnes of Hamersley Iron has committed to expand operations at Expenditure: $320m. zircon, 25,000 tonnes of HyTi, 190,000 tonnes of sulphate its Yandicoogina mine to increase production from 36 Employment: Construction: 280 ilmenite and 215,000 tonnes of synthetic rutile. Mt/a to 52 Mt/a. Hamersley recently expanded the current Expenditure: $39m. operation by establishing a new wet processing plant (to Oil & Gas Developments process low grade ore), an overland conveyor and tertiary Cliff Head (Perth Offshore Basin) - Oil Field Iron Ore crushing/screening facilities. The latest expansion involves a new pit at Junction South East, new crushing ROC OIL (WA) PTY LTD Hope Downs - Iron Ore Mine HOPE DOWNS LIMITED and screening plant and a new overland conveyor. The Cliff Head oil field, located 20 km south-west of Expenditure: $700m. Dongara, commenced first oil production in May 2006, Development proposals were approved by the government on 31 March 2006. Hope Downs Iron Ore Employment: Construction: 330; Operation: 650 within 14 months of it being formally approved by the assigned a 50% interest in the project to Hamersley Iron. Joint Venture. The field comprises a small, normally Construction work has commenced. Iron Ore Processing unmanned, offshore platform. Field production rates Expenditure: $1.5b. are expected to be in excess of 10,000 bbl/d from six Kwinana - HIsmelt Commercial Iron Making Plant Employment: Construction: 1000; Operation: 300 production wells. The oil is transported via a 14km HISMELT CORPORATION LIMITED pipeline to the onshore Arrowsmith stabilisation Kimberley - Koolan Island Iron Ore Mine HIsmelt Corporation, in a joint venture with Nucor (25%), plant, from where it is trucked to the new BP crude AZTEC RESOURCES LIMITED Mitsubishi (10%) and Shougang (5%), is developing a commercial-scale HIsmelt process plant at Kwinana, oil unloading facility at Kwinana, near Perth. Proven Aztec Resources has obtained environmental approval to near Perth. The first stage of the plant will produce and probable oil reserves are estimated at14.8 million develop a mining operation based on the ex-BHP Koolan 800,000 t/a of pig iron from iron ore fines, coal and fluxes. barrels. Cliff Head is the first oil field to be developed in Island iron ore deposits in Yampi Sound, 130 km north of Construction commenced in January 2003, with first the offshore Perth Basin. Derby. Aztec aims to produce premium grade iron ore at a hot metal production in mid-2005. Commissioning is Expenditure: $285m. production rate of approximately 4 Mt/a over 9-10 years. The current (JORC) resource is 53.3 Mt at 64% iron, with continuing towards full production capacity. Employment: Construction: 300; Operation: 15 the potential for further resources. Aztec anticipates that Expenditure: $800m. construction will commence by mid-2006 to enable first Employment: Construction: 320; Operation: 65 36 37 Prospect Prospect Projects Under Consideration (as at 18/5/2006)
Nickel Zinc/Copper Coal Ravensthorpe - Lateritic Nickel Mine and Hydro- North Eastern Goldfields - Jaguar - Base Metals Collie - Coal Mine (Ewington I) metallurgical Processing Plant Mine THE GRIFFIN COAL MINING COMPANY PTY LIMITED BHP BILLITON - RAVENSTHORPE NICKEL OPERATIONS JABIRU METALS LTD Griffin Coal plans to develop its Ewington I deposit, PTY LTD Jabiru Metals Limited has commenced construction of approximately 2 km east of Collie, which has estimated On 23 March 2004, BHP Billiton approved the the $56 million Jaguar copper-zinc mine 60 km north of recoverable reserves of 75 Mt. Environmental approval development of the Ravensthorpe Nickel Project that Leonora. The mine is expected to have a five-year life, has been given, subject to acceptance of a final will produce up to 220,000 t/a of mixed nickel/cobalt with concentrate production commencing in Q2 2007. environmental management plan. The mine will produce hydroxide, to be processed at BHP Billiton’s Yabulu Expenditure: $56m. about 2 Mt/a coal for private sector customers, including Griffin Energy’s nearby Bluewaters 1 power station, refinery in Queensland. Plant construction is expected Employment: Operation: 100 presently under construction. to take 30 months and the first shipment of product from Esperance to Yabulu is expected to commence in Q2 2007. Expenditure: $20m. Expenditure: $1.8b. Agriculture Diamonds Employment: Construction: 1400; Operation: 350 Mantinea Flats - Ord River Irrigation Scheme (Stage 2) Argyle - Underground Diamond Mine The conceptual project consists of developing and ARGYLE DIAMOND MINES PTY LIMITED Oil & Gas Developments servicing approximately 80 farms (about 4200 ha total) at Angel (Carnarvon Offshore Basin) - Gas and Mantinea Flats for irrigated intensive horticulture which Argyle Diamonds has committed to an underground mine at Argyle after a $100 million feasibility study, completed in Condensate Field will then be offered for sale. late 2005. Full production for the first stage, involving 7-8 WOODSIDE ENERGY LTD Ord Stage 2 M2 Area Mt/a ore extraction, is expected to be reached in 2011, with The Angel gas and condensate field, operated by The potential exists for a 30,000 ha irrigated agricultural average production of about 17 Mcts/a of diamonds until Woodside as part of the North West Shelf Venture development immediately to the north-east of the existing 2018. A second stage project will extend mine life to 2024. (“NWSV”), was approved for development in December Ord Stage 1 development in the far north of Western Expenditure: $1.2b. 2005. The development includes the NWSV’s third fixed Australia. Employment: Construction: 250; Operation: 500 production platform, which will be remotely operated, Expenditure: $500m. three subsea production wells and a 50 km subsea Employment: Construction: 650 Electricity pipeline which will link the new platform to the existing North Rankin production facility. Angel is expected to be Ammonia/Urea Gnangara - Bioenergy fully operational by Q4 2008. The platform will be capable BEACONS CONSULTING of processing 800 million standard cubic feet of gas a day Burrup Peninsula - Ammonia Urea Plant Beacons is planning the development of its Perth Bioenergy and 50,000 bbl/d of condensate. DAMPIER NITROGEN Project, involving a 45 MW base load power station at Expenditure: $1.6b. Dyno Nobel has purchased the interests of Plenty River Neerabup, 50 km north of Perth. The power station will (Plentex) and Thiess in a large scale ammonia/urea project burn timber waste from pine plantations and municipal Enfield (Carnarvon Offshore Basin) - Oil Field to be located on the Burrup Peninsula. Dyno Nobel has green waste. Financial closure is expected by the second WOODSIDE ENERGY LTD put plans for this project on hold due to current economic half of 2006, with construction commencing shortly after. Development of the Enfield project was approved in March conditions. Dyno Nobel is also conducting a feasibility study Expenditure: $90m. 2004. The oil field will be developed via subsea wellheads, into developing a 230,000 t/a ammonium nitrate production Employment: Construction: 250; Operation: 45 with flowlines tied back to a floating production, storage and facility, which could be located adjacent to the ammonia/ offloading (“FPSO”) vessel with disconnectable mooring. urea plant. The alternative (to a large scale ammonia plant) Mirambeena - Bioenergy Project After stabilisation, export crude oil will be produced of building a small scale ammonia plant to supply the BEACONS CONSULTING on board the FPSO and periodically exported through ammonium nitrate plant is being investigated as part of the Beacons is planning its Great Southern Bioenergy an offloading hose to tandem moored offtake tankers. feasibility study. Project, involving a staged 2 x 45 MW base load bioenergy The facilities are designed to operate for 20 years, with Expenditure: $900m. power station at Mirambeena, near Albany. The production expected to start by the end of Q2 2006. At full Employment: Construction: 1000; Operation: 130 Mirambeena plant will burn residues from the harvesting capacity, production will be 100,000 bbl/d of oil. of bluegums for export chips. Financial closure is Burrup West - Ammonia Urea Plant expected by the second half of 2006, with the first 45 MW Expenditure: $1.48b. AGRIUM AUSTRALIA plant in operation by 2008. The second stage expansion Employment: Construction: 100; Operation: 80 Agrium Australia Ltd (Agrium) is proposing to develop a is anticipated about two years later. North West Shelf 5th LNG Train A$900 million world-scale ammonia and urea plant on Expenditure: $94m. WOODSIDE ENERGY LTD a 69 ha site on the Burrup West Industrial Estate. The Employment: Construction: 250; Operation: 45 plant is expected to require approximately 100 TJ/d of A final investment decision for the 4.4 Mt/a Train 5 natural gas to produce around 1.2 Mt/a of granular urea expansion, with an associated second LNG loading jetty Gold and 100 000 t/a of ammonia. In December 2004, Agrium and extra processing facility support, was announced in commenced its project environmental approval process. Kalgoorlie - Super Pit - Golden Pike Cutback June 2005. Site work started in Q3 2005. The project is Agrium formally advised the State on 20 February 2006 KALGOORLIE CONSOLIDATED GOLD MINES PTY LTD expected to take approximately three years to complete, that it was discontinuing its plans for an ammonia/urea KCGM is planning to extend the life of its open-cut mine by with commissioning due to start around mid-2008 and project on the Burrup Peninsula. five years to 2017, with the Golden Pike Cutback. KCGM is in first LNG export cargoes planned for Q4 2008. Expenditure: $900m. the process of finalising its Public Environmental Review for Expenditure: $2b. Employment: Construction: 1000; Operation: 130 release by the EPA for public comment. Employment: Construction: 1500; Operation: 20 Sunrise Dam - Gold Mine - Underground Stybarrow (Carnarvon Offshore Basin) - Oil Field Ammonium Nitrate ANGLOGOLD AUSTRALIA LTD BHP BILLITON PETROLEUM PTY LTD Burrup Peninsula, Ammonium Nitrate AngloGold Ashanti commenced underground In November 2005, BHP Billiton approved the DEEPAK FERTILISERS development in October 2003 at the Sunrise Dam gold development of the Stybarrow oil field, located Deepak is investigating the feasibility of an ammonium mine to test the feasibility of expanding to underground approximately 65 km north-west of Exmouth. The project nitrate complex on the Burrup Industrial Estate for operations. The study involves the development of is expected to cost approximately US$600 million. At a plant capacity of 200,000t/a of ammonium nitrate, two declines, totalling 9 km in length, in the vicinity of a water depth of approximately 825 metres, it will be 170,000t/a of nitric acid with the option to either produce previously defined reserves. The first underground gold the deepest oil field development ever undertaken in or import 100,000t/a ammonia. was produced in Q4 2004. The company expects to make a decision on whether to proceed to full-scale underground Australia. Stybarrow will involve a subsea development Expenditure: $399m. mining in early 2007. A positive decision is expected to and an FPSO vessel which will be able to process Employment: Construction: 700; Operation: 150 increase the life of the project to at least 2012. approximately 80,000 bbl/d of liquids. Discovered in February 2003, Stybarrow and the adjacent small oil Bauxite/Alumina Expenditure: $87m. rim of the Eskdale field have estimated recoverable oil reserves of 60-90 million barrels. First production is Wagerup/Willowdale - Alumina Refinery Expansion Heavy Mineral Sands expected during Q1 2008. The estimated economic field ALCOA WORLD ALUMINA AUSTRALIA Cataby - Heavy Mineral Sands Mine life is 10 years. Alcoa is investigating the feasibility of a third production ILUKA RESOURCES LIMITED train expansion at its Wagerup alumina refinery to Expenditure: $815m. Iluka Resources proposes to develop a heavy mineral increase capacity up to 4.7 Mt/a. Conditional approval Vincent (Carnarvon Offshore Basin) - Oil Field sands mine near Cataby, 200 km north of Perth, to of the project was recommended by the Environmental produce up to 780,000 t/a of heavy mineral concentrates WOODSIDE ENERGY LTD Protection Authority in January 2006 and final over a 5-year period. The EPA has released its report The Vincent oil field was discovered in 1998 and is environmental approval is anticipated in the first half of 2006. and recommendations on the proposal. Production is located approximately 50 km north-west of Exmouth in a Expenditure: $1.5b. expected to commence Q3 2006. water depth of about 350 metres. Woodside is planning Employment: Construction: 1000; Operation: 150 to drill development wells at the Vincent location in Jangardup South - Mineral Sands Mine 2006, subject to obtaining necessary joint venture and Worsley/Boddington - Alumina Refinery Expansion CABLE SANDS (WA) PTY LTD government approvals. Approval of the $1 billion capital WORSLEY ALUMINA PTY LTD The Jangardup South minerals deposit is situated 54 expenditure for the first phase of the development was BHP Billiton has environmental approval to expand km south of the Nannup township and adjacent to the given in March 2006. Oil will be produced through a its Worsley alumina refinery from 3.7 Mt/a to 4.4 Mt/a. D’Entrecasteaux National Park. Cable Sands estimate sub-sea development and processed and stored in a A final investment decision is dependent on market that the deposit would provide 1.8 Mt of minerals. disconnectable, double-hull FPSO. First oil is planned for conditions including construction costs. Feasibility and environmental studies are well advanced. 2008 with initial production at about 100,000 bbl/d. Expenditure: $900m. Expenditure: $40m. Expenditure: $1b. Employment: Construction: 500; Operation: 150 Employment: Construction: 100; Operation: 50 36 37 Prospect Prospect Projects Under Consideration (as at 18/5/2006)
Kemerton - Titanium Dioxide Pigment Plant crush and screen the ore on site and truck it to Geraldton Midwest - Karara Magnetite Mine and Pellet Project LYONDELL CHEMICAL COMPANY Port for export. The EPA has a set a level of assessment GINDALBIE METALS LIMITED at Environmental Protection Statement. All approvals are Lyondell has environmental approval for a major Gindalbie Metals is currently completing a definitive expansion of its Kemerton titanium dioxide pigment plant anticipated to be in place to commence Stage 1 production August 2006. The company is also progressing a definitive feasibility study for the development of a magnetite mine near Bunbury to a capacity of 190,000 t/a. A decision to and pellet plant based on its Mt Karara deposit, 220 km proceed is dependent on market factors. feasibility study on its Stage 2 project, which would increase production to 10-25 Mt/a hematite. A new railway and deep south-east of Geraldton. The company recently completed Expenditure: $470m. water port at Oakajee will be required. Construction of its first stage of drilling which delineated a JORC inferred Employment: Construction: 500; Operation: 200 Stage 2 is predicted to commence by mid-2008. resource of 737 Mt at 37.1% iron to support a 7 Mt/a pellet Keysbrook - Heavy Mineral Sands Mine Expenditure: $41m. project for at least 20 years. Gindalbie proposes that the magnetite concentrate will be transported by slurry pipeline OLYMPIA RESOURCES LIMITED Employment: Construction: 30; Operation: 90 to Oakajee and pelletised prior to shipping. Commissioning Olympia commenced the environmental approval Kimberley - Argyle Iron Ore Mine and first exports are anticipated in 2009. process for its proposed mine near Keysbrook, 70 km RESOURCE MINING CORPORATION LIMITED south of Perth, in June 2005. The EPA set a Public Expenditure: $720m. Environmental Review level of assessment. Olympia Resource Mining Corporation recently completed a four Employment: Construction: 200; Operation: 175 plans to start mining in early 2007, subject to government stage drilling program at the Argyle hematite iron ore Pilbara - Iron Ore Mine environmental approvals. Olympia has identified proven project, 120 km south of Wyndham. A JORC inferred and probable reserves of 41 million tonnes of ore resource of 17 Mt at 55% iron was established and further IRON ORE HOLDINGS containing 1.2 million tonnes of zircon, ilmenite and drilling is planned for 2006. There is also the potential Iron Ore Holdings completed a scoping study in July leucoxene. The products will be trucked to Picton, near for a magnetite resource adjacent to the hematite. It 2005 on its three projects (Yandicoogina Creek, Lamb is envisaged that 1.5-2 Mt/a hematite will be produced Bunbury, for separation and export. The estimated mine Creek and North Marillana) located in the Pilbara, 275 and trucked to Wyndham for export. Resource Mining is life is 8 years. km south of Port Hedland. The study was based on the currently investigating several options for the upgrade Expenditure: $31m. and construction of new facilities at the port to enable the road transport of 2 Mt/a pisolitic ore, which is expected Employment: Operation: 30 export of iron ore. The company is to commence a pre- to be shipped from Port Hedland. Iron Ore Holdings is continuing to conduct exploration work and drilling Kwinana - Titanium Dioxide Pigment Plant feasibility study shortly. programs across its tenements. TIWEST JOINT VENTURE Expenditure: $50m. Tiwest has environmental approval for the staged Employment: Construction: 120; Operation: 80 Pilbara - Iron Ore Mine Rail and Port Development expansion of its Kwinana pigment plant to 180,000 t/a. Mid West - Extension Hill Magnetite Project FORTESCUE METALS GROUP (FMG) A decision to proceed with further stages within this MT GIBSON IRON/ASIA IRON FMG is proposing to develop new iron ore mines at approved expansion is dependent on market conditions. Christmas Creek and Cloud Break in the Chichester Ranges Employment: Construction: 108; Operation: 98 Asia Iron Holdings Limited is proposing to develop the Extension Hill magnetite deposit near Mt Gibson, 330 km of the eastern Pilbara. The mines will be serviced by a Shark Bay - Coburn - Heavy Mineral Sands Mine south-east of Geraldton. The project will produce 5 Mt/a multi-user railway and new port facilities at Port Hedland. GUNSON RESOURCES LIMITED of magnetite concentrate, which will be transported by Preliminary earthworks have commenced at Port Hedland. The definitive feasibility study for the mining operations In December 2004, Gunson Resources completed a slurry pipeline to the Port of Geraldton, from where it will was finalised in April 2006. Construction of the rail and bankable feasibility study on the Coburn Project, located be shipped to a new 2.5 Mt/a pellet plant at the port of south of Shark Bay, about 650 km north of Perth. The Longtan in Nanjing, China. A feasibility study was completed port facilities is planned to start in mid-2006 to supply the project consists of the Amy deposit which has a total in Q1 2006 and environmental assessment of the project is Chinese market from early 2008. indicated and inferred resource of 710 Mt, averaging 1.4% underway. Site construction is scheduled to commence in Expenditure: $2.5b. late 2006. Mt Gibson Mining, which has rights to all hematite heavy minerals. The project is currently being assessed Employment: Construction: 1500; Operation: 300 by the Environmental Protection Authority and approval is mineralisation within the tenement, is completing a desktop expected in the first half of 2006. Gunson anticipates that evaluation to investigate the possibility of mining and Pilbara - Rapid Growth Projects 4+ exporting a further 1.5-2 Mt/a hematite. mining will commence in mid-2007. BHP BILLITON IRON ORE PTY LTD Expenditure: $715m. Expenditure: $75m. Further to Rapid Growth Projects (“RGP”) 1, 2 and 3, Employment: Construction: 200; Operation: 20 Employment: Construction: 400; Operation: 300 BHP Billiton proposes to expand the production capacity Mid West - Koolanooka Iron Concentrate/Pellet of its Pilbara iron ore operations to nominally 152 Mt/a, Iron Ore Project subject to board and government approvals. RGP4, which Brockman - Brockman 4 Iron Ore Mine MIDWEST CORPORATION LIMITED is focussed on expanding the Newman operations, is currently in the feasibility stage. HAMERSLEY IRON PTY LIMITED Midwest Corporation proposes to develop an iron ore Hamersley Iron is currently undertaking pre-feasibility mining operation at the Koolanooka magnetite iron ore Expenditure: $1.8b. deposit, 160 km south-east of Geraldton, to produce 4.5 studies on developing a new mine at its Brockman 4 Mt/a magnetite concentrate and/or pellets. The project Pilbara - West Angelas Mine Expansion to 25 Mt/a deposit. Construction is likely to commence in 2007, with is expected to include gas and water pipelines and a ROBE RIVER MINING CO PTY LTD commissioning in 2009. dedicated 120 MW gas-fired power plant. A scoping study was completed in February 2006 and a pre-feasibility Robe River is considering expanding operations at its Cape Lambert - Cape Lambert Capacity Expansion study is due to commence in mid-2006. The company West Angelas mine to increase production from 25 Mt/a and Stockyard Rationalisation anticipates production will commence in 2010/12, to 35 Mt/a. following the completion of a successful studies. ROBE RIVER MINING COMPANY PTY LIMITED Expenditure: $217m. Expenditure: $1b. Robe River Mining is considering expansion of the Employment: Construction: 200; Operation: 300 capacity of its port facilities at Cape Lambert, east of Employment: Construction: 1200; Operation: 270 Karratha. The expansion and rationalisation works will Mid West - Weld Range Iron Ore Mine Iron Ore Processing lift the design iron ore export capacity of the facilities to Fortescue (Cape Preston) - Mine and Pellet Plant 69 Mt/a. This work includes expansion of the stockpile MIDWEST CORPORATION LIMITED stacker and reclaimer facilities. Midwest Corporation proposes to develop a 15-20 MINERALOGY PTY LTD Expenditure: $302m. Mt/a iron ore mine at Weld Range 65 km south-west of Mineralogy Pty Ltd’s Fortescue magnetite deposits lie Meekatharra, producing a mix of hematite lump, fines over three discrete blocks (North, Central and Southern), Employment: Construction: 450; Operation: 70 and possibly concentrate. The project is expected to some 20 km from deep water at Cape Preston, south- Great Southern - Southdown Magnetite - Mine include a new standard gauge 350 km rail line and a new west of Dampier. Mineralogy has recently announced an GRANGE RESOURCES LIMITED deep water port facility at Oakajee. A go-ahead for the agreement with the Chinese company CITIC Pacific Ltd project is dependent on commercial and market factors. Grange Resources Limited is undertaking a bankable on development of the Central ore blocks. Mineralogy The company commenced an extensive drilling program feasibility study on the Southdown magnetite iron will retain rights to the Southern and Northern blocks. in May 2006, with a pre-feasibility study to be completed ore project, located approximately 90 km north-east The CITIC agreement is expected to involve mining, during 2006. Project start-up is anticipated in 2010. of Albany. The study is expected to be completed by concentrating, pelletising and export through new port mid-2006 and the company anticipates that, subject Expenditure: $800m. facilities at Cape Preston. This could lead to a number to government approval, construction will commence Employment: Construction: 900; Operation: 220 of projects, exploiting Mineralogy’s magnetite deposit, in late 2006/early 2007. The interim indicated and Midwest Region - Karara Hematite Project producing concentrate, pellets and DRI. Environmental inferred (JORC) resource estimate is 458 Mt grading 38% approval has been granted. magnetite. Grange intends to conduct further drilling GINDALBIE METALS LIMITED Expenditure: $1.4b. during 2006. The company proposes to produce 6.6 Mt/a Gindalbie Metals proposes to develop a direct shipping of magnetite concentrate, which will be transported via hematite ore project of 1.5 Mt/a at Mt Karara, 220 km south- Employment: Construction: 2000; Operation: 400 a slurry pipeline to the Port of Albany for export and east of Geraldton. The company is currently completing pelletising overseas. Environmental studies are nearing phase two of a drilling program to define a JORC-compliant Molybdenum resource and expects that sufficient resources will be completion and Grange anticipates final environmental Pilbara - Spinifex Ridge Mo/Cu mine approval in December 2006. delineated in Q3 2006 to sustain the project. Gindalbie MOLY MINES LIMITED Expenditure: $560m. proposes to truck the ore along an existing haul road Employment: Construction: 600; Operation: 200 to Morawa, then rail the ore from Morawa to the port of The Spinifex Ridge molybdenum/copper deposit is located Geraldton for export. Gindalbie is progressing the relevant 50 km north-east of Marble Bar in the Pilbara region of Jack Hills - Iron Ore Mine government approvals, with development planned to Western Australia. Moly Mines is expected to complete its MURCHISON METALS LIMITED commence in late 2006/early 2007, with export of product pre feasibility study by the end of Q2 2006 and is targeting Murchison Metals proposes to develop an initial 1-2 Mt/a by mid-2007. a decision on project development by late 2006. A positive (Stage 1) direct shipping iron ore mine at Jack Hills, 380 Expenditure: $20m. study outcome would result in Australia’s first significant km north-east of Geraldton. The company intends to Employment: Construction: 60; Operation: 50 project in the 200,000 t/a global molybdenum market. 38 39 Prospect Prospect Projects Under Consideration (as at 18/5/2006)
Nickel economic and strategic aspects. The Gorgon joint venturers Platinum Group Metals have market commitments for 75% of the LNG product. The Goongarrie - Kalgoorlie Nickel Project - Mine and joint venture is anticipating environmental approvals so as Pilbara - Platinum Deposit Hydrometallurgical Processing Plant to be in a position to start construction in early 2007. HELIX RESOURCES NL HERON RESOURCES LTD Expenditure: $11b. Helix Resources NL has established an indicated A detailed pre-feasibility study is continuing for the Employment: Construction: 3000; Operation: 600 resource of 9.2 Mt at 2.9 g/t combined platinum, development of a 50,000 t/a mine and hydrometallurgical palladium, rhodium, and gold, 0.2% nickel, and 0.3% processing plant at Goongarrie, about 85 km north of Macedon (Carnarvon Offshore Basin) - Gas Field copper at its project site near Karratha. Preliminary Kalgoorlie. The project will be based on the company’s BHP BILLITON PETROLEUM PTY LTD mining studies suggested a mining rate of combined laterite nickel resources of 903 Mt grading 0.74% Ni The Macedon gas field, located about 50 km north of open cut and underground production of 1.5 Mt/a. Further and 0.05% Co. The dominantly siliceous component of Exmouth, was discovered in 1992 by the West Muiron-3 activity was postponed in early 2003, as a result of poor exploration results and a decreased palladium price. The the resource at Goongarrie-Siberia, being some 453 well, with a follow-up appraisal campaign in 1994. BHP project is under review. Mt grading at 0.7% Ni and 0.05% Co, is considered to Billiton is continuing to investigate domestic market be amenable to beneficiation by low cost screening to opportunities for Macedon, which is estimated to contain a leach feed grade target of 1.5% Ni. Heron and Inco a gas resource of up to 1.2 Tcf. Gas recovered to date is Rare Earths signed a formal agreement in July 2005 under which dry, containing no condensate or LPG. Mt Weld - Rare Earths Operations they will complete the feasibility assessment and, if warranted, develop the project. Inco is mid-way through Onslow - LNG Plant LYNAS CORPORATION LTD Lynas is planning to mine up to 200,000 t/a ore, producing a confirmatory diamond drilling program, aimed at BHP BILLITON PETROLEUM confirming leach feed grade estimates derived from 45,000 t/a of concentrate, which is equivalent to 15,000 Heron’s previous RC drilling. BHP Billiton Petroleum is conducting a pre-feasibility t/a rare earths oxides. A feasibility study was completed study into the development of the Scarborough gas Expenditure: $1.4b. during 2005 Total project capital requirements are resource located offshore in about 900 m of water and Employment: Construction: 1000; Operation: 300 estimated at $80 million, including an open pit mine and 280 km north-west of Onslow. Its project proposal two processing plants in China. A development decision North Eastern Goldfields - Yakabindie Nickel Mine includes development of an associated 6 Mt/a LNG plant on the project is expected by mid-2006, with production at a site approximately 4.5 km south-west of Onslow. BHP BILLITON NICKEL expected to begin within 12 months from the decision. BHPB will be the owner and operator of the LNG plant. The Yakabindie project is based on a large nickel deposit Expenditure: $80m. The bulk of the LNG produced will be sold to the United situated near BHP Billiton’s existing Mt Keith nickel Employment: Construction: 100; Operation: 35 States west coast and Asian energy markets. The project and is estimated to contain a resource of 289 Mt @ Pilbara LNG Project sanction is expected by Q4 2007 and 0.58% nickel. BHPB is considering developing Yakabindie construction is scheduled to commence soon after. LNG Salt as an integrated part of the Mt Keith project, and is production is anticipated by late 2011. Exmouth Gulf - Yannarie Solar Salt Project conducting a pre-feasibility study, including infill drilling of the ore body and metallurgical testing. Expenditure: $5b. STRAITS SALT PTY LTD Expenditure: $20m. Employment: Construction: 2500; Operation: 150 Straits Salt is currently investigating the feasibility of producing up to 10 Mt/a of salt in the eastern Exmouth Pilbara - Nickel Mine Pyrenees Development (Carnarvon Offshore Basin) Gulf area, 1100 km north of Perth. It has exploration SHERLOCK BAY NICKEL COMPANY - Oil Fields licences over the area of interest while it undertakes Sherlock Bay Nickel Corporation is currently investigating BHP BILLITON PETROLEUM PTY LTD its feasibility studies. Straits has submitted its the feasibility of the Sherlock Bay nickel project, 100 km The proposed Pyrenees Development is located 45 km Environmental Review and Management Program to the east of Karratha. The company intends to develop an north of Exmouth in approximately 200 m water depth. EPA and is in discussions with government regarding approximately 9000 t/a nickel project based on the Bioheap The project is in the feasibility stage. The Pyrenees field appropriate tenure and associated matters. ore treatment process. A major review of the project is was discovered in July 2003 when the Ravensworth-1 well Expenditure: $120m. underway, taking into account current resource estimates encountered a 29.4 metre net column of oil, while the Employment: Operation: 70 and to confirm the results of prior metallurgical testing. Crosby-1 well encountered a 43.5 metre net column of The key focus in the coming 12 months is to complete the oil. The preferred development concept is an FPSO vessel Timber necessary metallurgical test programs, which remain on the connected to subsea wells and flowlines. The FPSO will Mirambeena - Engineered Strand Lumber critical path for project development. have a design capacity of 80,000 bbl/d of liquids. The field Expenditure: $30m. life is estimated to be 20 years. LIGNOR PTY LTD Lignor Pty Ltd is proposing the development of an Oil & Gas Developments Scarborough (Carnarvon Offshore Basin) - Gas Field engineered strand lumber plant located at Mirambeena, EXXON MOBIL near Albany. The plant will source most of its timber Browse Basin - Ichthys (Browse Offshore Basin) The gas field is located in around 900 metres of water from the extensive eucalypt plantations growing in the INPEX and about 280 km offshore, in the Carnarvon Basin Albany region and will use technology developed by The Ichthys gas and condensate field was discovered in with probable reserves of approximately 8 Tcf of gas. the German engineering company, Siempelkamp. The 1980 and is located in 250 m of water, approximately 440 BHP Billiton Petroleum (BHPB) completed 3D seismic company has raised $5 million to complete its feasibility study, which should be completed by mid-2006, with km north of Broome and 250 km from the nearest land. survey work and drilling of Scarborough-3, 4 and 5 wells construction planned for late 2006 and operations by late The permit is 100% operated by Inpex which has drilled during 2004 and early 2005. Evaluation of the data is in 6 discovery and appraisal wells since 1998. The P50 2008. progress. BHPB is also conducting a pre-feasibility study estimated recoverable resource in place is approximately to assess the viability of providing Scarborough gas to its Expenditure: $250m. 10 Tcf of gas and 350 mmbbl of condensate and LPGs. proposed Pilbara LNG plant near Onslow. Employment: Construction: 400; Operation: 140 Inpex is planning the development of the field to include offshore semi-submersible facilities and a subsea Expenditure: $100m. Vanadium pipeline to a yet to be decided offshore location, where Scott Reef/Brecknock (Browse Basin) - Gas Fields approximately 5-6 Mt/a LNG will be produced for export Pilbara - Balla Balla Vanadium/Ferroalloys Project WOODSIDE ENERGY LTD to the Asia-Pacific market. The first LNG shipment is AUROX RESOURCES LIMITED The current estimated contingent resources for the scheduled for 2012. Aurox has commenced a bankable feasibility study on the Woodside operated gas fields in the Browse Basin exceed Expenditure: $8b. Balla Balla ferroalloy project located mid-way between 20 Tcf of gas and 300 million barrels of condensate. The Employment: Construction: 3000; Operation: 500 the regional centres of Karratha and Port Hedland. final well for 2005, Calliance-1 (spudded mid-October, Granted mining leases enclose an ore reserve estimated Carnarvon Basin - Pluto LNG 2005) intersected a gross gas-bearing interval of 172 m in to be 53.9 Mt grading 0.73% V2O5. The project is close to WOODSIDE the Plover Formation. During 2006 Woodside (Operator key infrastructure, including a natural gas pipeline and The Pluto gas field was discovered in April 2005. It and ~ 50% interest holder) is planning to drill four electricity grid. Pilot-scale metallurgical testwork and is about 100 km off the north-west coast of Western appraisal wells and finalise a development concept for an new mine scheduling figures confirm a 25-year mine Australia and roughly 180 km from the Burrup Peninsula. LNG production facility capable of supporting 7 - 14 Mt/a life, high vanadium recoveries and low operating costs. The field contains an estimated resource of at least 3.5 of LNG. Start-up is planned from 2011 to 2014. The ore body also contains significant concentrations trillion cubic feet of relatively dry gas, with small amounts Tern/Petrel (Bonaparte Offshore Basin) - Gas Fields of apatite, a source of phosphate for the production of of condensate and low levels of carbon dioxide. Woodside phosphoric acid and fertiliser. The completion of the plans to produce 5-7 Mt/a of LNG from this field. It is SANTOS LIMITED bankable feasibility study is scheduled for mid-2006, with currently investigating a number of potential sites for The offshore Petrel gas field, discovered in 1969, is operations to commence at the end of 2007. development of a new onshore gas plant, expecting to located about 250 km west of Darwin on the WA/NT make its final site selection by mid-2006. The gas will be seabed border in the Bonaparte Basin. The offshore Windimurra - Vanadium Pentoxide mine and brought to shore through a 200 km pipeline. Tern gas field, discovered in 1971, is located about processing plant Expenditure: $5b. 300 km west of Darwin in WA waters in the Bonaparte PRECIOUS METALS AUSTRALIA LIMITED Employment: Construction: 1500; Operation: 150 Basin. Field development options include installation Windimurra, located approximately 80 km east of Mount of unmanned offshore production platforms with a Magnet, is one of the largest proven vanadium ore bodies Gorgon (Carnarvon Offshore Basin) - Gas and pipeline to a gas treatment plant south of Darwin. The in the world, with JORC-compliant resources of 95 Mt @ Condensate Field development possibilities for these fields have been 0.47% vanadium, including a proven reserve of 50.4 Mt CHEVRON AUSTRALIA PTY LTD enhanced by recent significant discoveries by other @ 0.49% vanadium. PMA is conducting a feasibility study The Gorgon Joint Venture is considering an LNG and parties nearby, which may provide tie-in potential for to assess re-developing the project and also producing domestic gas development (up to 10 Mt/a) at Barrow Petrel and Tern to service domestic gas customers. A 9000 t/a of ferrovanadium. The study is expected to be Island, based on gas from the Gorgon and Jansz fields. conceptual plan involves initial development of Petrel completed in Q2 2006, with construction to commence in The restricted industrial use of Barrow Island has with a pipeline to an onshore gas plant and a subsequent Q3 2006. been approved, in principle, by the Western Australian phase that completes Petrel and develops Tern. Expenditure: $149m. Government after evaluation of environmental, social, Expenditure: $1b. Employment: Construction: 400; Operation: 120 38 39 Prospect Prospect As at May 2006 Major Resource Development Projects: Western Australia
INSET B MutineerO INSET C SunriseN ExeterO Campbellu Troubador N EaglehawkEgret!Hermes Endymion Searipple ! Lambert Wonnich u N Kelp Deep Capella uu O O u Angel ; /Sinbad NDoric/Ulidia ! Cossack BambraN NLinda Perseus u uNorth ! OJahal Gaea/ !Wanaea Harriet/Gudrun BLeeN Laminaria East ChudditchN Dockrell Ishmaelu Rankin ! Legendre North ORoseC uuMonty O Buffalo Keast uu Goodwyn ! Varanus Island! A Echo/Yodel u u Legendre South North Alkimos ;; !u Io/Janszu Goodwyn South/Pueblo Tidepole Agincour t ! ! Gipsy Josephine ! UraniaN N Rankin/u Burrup Peninsula Monet/Simpson O S.Plato Bayu-Undan JanszN Wheatstone Sculptor ;Dixon/West Dixon u N @ Ammonia /Tanami O !Little Sandy/Pedirka/North Pedirka/ Eurytion NNGeryon Iago/N Tryal Rocks N @ N Hoover Victoria Pluto Reindeer @ Ammonia-urea O Double island u Wilcox Caribouu Gorgon CorvusN @ Ammonium Nitrate Barrow O Jabiru N Island MaenadN Orthrus Wandoo ! 6 Desalination Barrow Island O Challis/Cassini uChrysaor/Dionysus PuffinO uWest Tryal Rocks @ LNG O O Stag Skua OMontara SEE INSET C N Petrel John Brookes N Cape Lambert N Crux Parker Point Gorgon u q q Spar N Dampier N Tern Dampier salt s East Spar N Karratha N Brewster N Scott Reef BlacktipN Woollybutt O uIchthys n Radio Hill N Brecknock I Fortescue Z Whundo Cu Zn K Munni Munni N Brecknock South Turtle O b Chinook/Scindian Mitchell Plateau ConistonO ! Griffin O ONovara ! EskdaleO Taunton! South Chervil Ord Stage 2-M2 SkiddawEnfield Wyndhamq 6 ne O Crest li 6 OO Vincent Yammaderry !! Ord Stage 2-Mantinea Flats 6 Stybarrow O NRavensworth/Crosby ! Saladin Koolan Island Laverda ! N O!Pyrenees Cowle ! Skate I Ord Stage 1 N ! q Cockatoo Island I I ! ral Gas Pipe I Middle Robe Mesas Scafell Roller u t Robe Lake Argyle Hydro 6 Macedon Coaster O @ s Onslow I Robe Mesa J r Na e Mesa A Stickle Pilbara LNG pi N m Da I Bungaroo Creek Tubridgi - h KIMBERLEY rt Argyled Pe N Point Torment Derbyq Lloyd s Boundary Exmouth Gulf West Terrace OO Sally Malayn Homestead I O d Ellendale I Sundown nCopernicus Silvergrass Blina K I Broome q Panton Sill Nammuldi Manyingee Brockman 2 I O Rough Range , Brockman 4 I ZPillara Zn Pb 0 100 j Paulsens 200 km
RESOURCE SYMBOLS Bauxite-Alumina a Alumina refineries b SEE INSET B Mines and deposits Chemicals / Petrochemicals / Petroleum Coyote j @ Processing plants / refineries Port Hedland N Natural gas field Scarborough N q s Port Hedland Salt O Oil field ! Salt CreekV Balla Balla I Nimingarra Natural gas / oil field u Natural gas / condensate field Zn Pb Z YarrieI n Sherlock Bay ; Natural gas / oil / condensate field Z Whim Creek Cu Z Chromite jIndee Spinifex Ridge Mo Cu c Wodgina t Mines and deposits Z Sulphur Springs Zn Cu Clays Brick / tile procesing plants Woodie Woodie r Z Coal j Te lfer Au Cu h Nifty Cu Coal/coal bed methane (CBM) mines and deposits PILBARA Golden Eaglej ? Lignite mines and deposits rAnt Hill Z Copper-Lead-Zinc Cloud BreakI Maroochydore Cu Co Z Mines and deposits IChristmas Creek , Western 4 I Roy Hill Kintyre Diamonds Marandoo I IYandi/BHPB d Mines and deposits Tom Price I I Yandicoogina/HI Beasley River I I I Mindy Mindy Gold Mining Area C I I j Hope Downs I Rhodes Ridge Mines and deposits ParaburdooIWest Angelas I IEast Angelas Gypsum Eastern Range I Giles Mini I I IOrebody 23, 25 & 18 x Channar I IJimblebar Mines and deposits Mt Whaleback c Heavy mineral sands Coobina m Mines and deposits — titanium-bearing sands G Mines and deposits — garnet-bearing sands J Ti02 pigment and synthetic rutile plants Iron ore q x Lake MacLeod I Mines and deposits s Lake MacLeod Y Downstream processing plants Limestone-Limesand 4 Mines and Deposits Carnarvon C Cement plants Plutonic j Magnesite Fortnum j r p Mines and Deposits Horseshoe South Manganese ore r Mines and deposits y Downstream processing plants Wingellina Jack HillsI Nickel n n Mines and deposits Shark Bayqs jJundee/Nimary n Magellan PbZ v Smelters and refineries West Musgrave Bluebird–Meekatharra mCoburn Gabinthia Wilunaj Phosphate j V Wiluna West I jWilliamson Weld Range I , P Mines and deposits n Honeymoon Well n Lake Way j, ,Yeelirrie ,Lake Maitland Platinoids Burnakura Nowthanna K jGidgee nMt Keith Mines and deposits j Bronzewing/Mt McClure Rare earth elements Yakabindie n Barrambie V Cosmosn R Mines and deposits Waterloo j Salt Leinstern Darlot Moolart Well Sandstone Plant n j s Production facilities / pans INSET A Port Gregory Hill 50 Agnew j ,Thatcher Kwinana/Rockingham j j Lawlers j Thunderbox Silica - Silica Sand G I Tallering Peak j p j Soak w nMarshall Pool Mines and deposits q AIS Jetty 0 50km V Lords Henry & Nelson p Sickle X a Windimurra Jaguar Zn CuZ j Silicon smelters Alumina Refinery m Gullewa Au Cu j Whisper j Brightstar Talc @ Gingin Oakajeeq j Kirkalocka Plant Tarmoola j j BP Oil Refinery Narngulu Synthetic Z Golden Grove Zn Cu pn T Mines and deposits q j P C Cement and Lime Chandala Geraldton J Rutile Minjar j Gossan Hill Ag Au Sons of Gwalia jMurrin j R Mt Weld Tantalum Alinta Wind farm8 Mt Karara IIjMt Mulgine Murrin jSunrise Dam t Mines and deposits @ Chlor Alkali J Synthetic Yardarino NuMount Horner Blue Hills Granny Smith–Wallaby Rutile Hovea–EremiIa Koolanooka j Uranium @ Chemicals Neerabup Dongara OOO Xyris IKoolanooka South Red October O mu j , Mines and deposits 6 Desalination 1 Cliff Head O DoApiumT Tropicana Jingemia NOu nga Three Springs I Mt Gibson Vanadium-Titanium @ Fertilizers Malaga Brick ra HM Mulga Rock Middle Swan Brick Beharra Springs/ j Davyhurst j jSand George , V Mines and deposits @ Midland Brick u m Eneabba Fused Alumina North Beharra Woodada Mt GibsonWindarling RangeI n Goongarrie •PERTH Springs h j Carosue Dam NON-MINERAL PROJECTS @ Fused Zirconia Tarantula Central West Paddington j 6 Caversham Tile Mt JacksonI Cawsen Lindsays Find Irrigation/water schemes Y HIsmelt y nBlack Swan q qFremantle 8 Emu Downs Wind Farm EMD/HiTec j Kanowna Belle – Red Hill Major port handling facilities @ LPG Mt Pleasant j jj nBulong 8 Major power stations Armadale Brick Cooljarloo m Koolyanobbing I Kundana v Avalon Plant v Nickel Refinery m j jSuper Pit 1 Downstream timber processsing plant Cardup Brick Cataby v 8 Power Station Coolgardie-Redemption Kalgoorlie Ni Smelter Gas pipeline Proposed gas pipeline j nBlair-Area57 @ Sodium Cyanide SEE INSET A Westonia Mt Marionj CarnilyanjAldiss–Randalls OPERATING PROJECTS ARE SHOWN IN BLUE j Long–Victor nnKambalda Concentrator J m Keysbrook j n POTENTIAL PROJECTS ARE SHOWN IN RED Titanium Pigment Marvel Loch j Nepean n n Beta-Hunt @ Spargoville njSt Ives PROJECTS ON CARE AND MAINTENANCE ARE Zirconia Yilgarn Star Armstrong n t Bald Hill Pinjarra n SHOWN IN PURPLE a8 Miitel–Redross j Lanfranchi PERTH• Trident abHuntly Pinjarra Gallium j Boddington Au Cu Emily Ann – Maggie Hays n j Central Norseman Waroonam a n Forrestania Wagerup b Kemerton m Saddleback O'Sullivans ? @ Chlor Alkali Kemerton X w Silicon Smelter 8 ? Scaddan aWorsley J Titanium JAustralind 8Bluewaters Western Pigment q Bunbury h 8 Collie Phillips River – Trilogyj nRavensthorpe Australia m hPremier 8 Ewington q6 Dardanup 1 Dardanup Muja 8 Esperance Capel Synthetic Rutile J mGwindinup 1Manjiump m Capel m Ludlow mm Jangardup South I Southdown Tutunup Southm Yoganup West h Leeuwin - Naturaliste CBM Mirambeena 1 NWhicher Range tGreenbushes 8 q Albany Albany Wind Farm 0 100 200 400 300 km
A Bright Future Planned for Investors in Victoria Petroleum N.L. Victoria Petroleum N.L. plans to double oil & gas production net revenue in calendar 2006. Participant in onshore North Perth Basin Jingemia Oil Field production, South Australian Cooper Basin Mirage and Ventura Oil Fields and Flour Bluff Gas Field Development Project, Texas, USA 4Mirage and Ventura oil discoveries in South Australian Cooper Basin on stream at gross 350 barrels of oil per day with aim to increase production in excess of 600 bopd in 2006. 4Appraisal drilling of Greater Mirage Murta oil pool with potential of up to 20 million barrels of oil in place to be followed by third quarter 2006 seven well exploration drilling program in Cooper Basin South Australia/Queensland 4Largest exploration acreage holder in South Australia and Queensland Cooper/Eromanga Basin with average 40% interest 4Texas Gulf Coast Margarita Gas Exploration Project with targets up to 200 BCF drilling in second half 2006 along with development drilling of 200 BCF gas potential Flour Bluff Gas Field, Texas producing up to 5 million cubic feet per day gas equivalent 4Jingemia Oil Field North Perth Basin gross production at rates of up to 5,400 barrels of oil per day 4Targeting with development success Australia and USA calendar 2006 est. net oil production of 600 barrels of oil per day and $8 million net revenue with 18 wells planned in next twelve months
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