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PDC Regional Investment Blueprint

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PDC Regional Investment Blueprint PILBARA DEVELOPMENT COMMISSION T: +61 1800 843 745 E: [email protected] Version: 7 Disclaimer While the information contained in the publication is provided in good faith and believed to be accurate at the time of publication, appropriate professional advice should be obtained in relation to any information in this publication. RPS Group, the State Government of Western Australia and the Pilbara Development Commission shall in no way be liable for any loss sustained or incurred by anyone relying on the information. Chairman’s forward 6 Executive summary 7 1.0 Introduction 12 Towards a resilient and prosperous Pilbara 12 The framework for regional development 12 Blueprint development approach 14 2.0 Local drivers and characteristics 19 Regional overview 19 The economy 25 Community and culture 37 3.0 Regional and global influences 41 Emerging markets 41 Security and sustainability 45 Technological advances 47 4.0 Regional capacity for growth 49 Human capital 49 Sustainable communities 55 Connectivity 61 Business competitiveness 66 5.0 Comparative advantages 70 Strong investment links with Asia 70 Natural environment and resources 70 Location of major industrial activity 71 Aboriginal culture and heritage 71 Export infrastructure 72 A unique combination 72 6.0 Pilbara Vision 73 The Pilbara in 2050 73 Aspirational population targets 74 Strategic priorities 78 7.0 Regional Pillars 80 Different approaches to growth and development 80 The Regional Pillars 80 Pillar objectives 82 8.0 The minerals and energy industry 91 Expanded and new operations 91 New resource opportunities 92 9.0 Transformational Opportunities 93 Transformational opportunities profiles 93 10.0 Strategic risks and challenges 139 Collapse in demand for key commodities 139 Access to investment capital 139 Commitment to regional development 139 Resource access, tenure and diversification of uses 139 Minerals and energy industry workforce practices 140 11.0 Implementation framework 141 Alignment and coordination 141 Advocacy and promotion 141 Knowledge portal 141 Investment prioritisation 141 Financing and funding development 141 Monitoring and reviewing outcomes and actions 142 Regional cooperation 142 Implementing the nine Pillars 142 Appendices Appendix 1 Acronyms 143 Appendix 2 Key plans and strategies 145 Appendix 3 Strategic risks and challenges identified 150 by stakeholders Appendix 4 Key stakeholders 159 Appendix 5 Key sources of funding 161 Appendix 6 Key regional indicators 166 Appendix 7 Acknowledgements 171 Appendix 8 References 173 “Innovation and technological change are the greatest drivers of productivity and the greatest sources of inspiration for the Pilbara’s future.” Innovation and technological change are the greatest drivers of productivity and the greatest sources of inspiration for the Pilbara’s future. The Pilbara Regional Investment Blueprint is our commitment to view our challenges and changing environment as opportunities to be innovative in our thinking, and resilient as a community. Haul trucks will be driverless, one in four people will be working from home and energy will be harvested from renewable sources; these are some of the likely scenarios the Pilbara, and the world, will be experiencing in the year 2050. Considering these scenarios, among myriad emerging global trends that will shape the way we live and do business 35 years from now, has been vital in the development of the Blueprint. The success of the Government of Western Australia’s Pilbara Cities initiative in addressing the land and infrastructure needs of the growing population centres has been critical to revitalising the region. It is also a great example of what is possible if we work together towards a clear, shared vision. While there is still work to be done, the Blueprint heralds a new direction for the Pilbara as we turn our focus firmly towards expanding the region’s economic base and building a legacy that we are proud to pass on to our children and grandchildren. More than three times the size of England and accounting for 36% of Australia’s merchandise exports, the Pilbara boasts a powerhouse combination of location, access to markets, a world-class customer base and unique natural assets that position us for future growth and prosperity. It’s an exciting region on the cusp of new discoveries and opportunities. Undeniably, the resources sector will remain the foundation of the Pilbara’s economy for decades to come; however, the region boasts numerous other comparative advantages that present exciting opportunities for new industries. These opportunities will take the Pilbara beyond just “business as usual” and will chart our aspirational future. In reading this Blueprint, I encourage you to embrace big-picture thinking towards what could be possible for the Pilbara of tomorrow. Collective strategic action will enable us to seize new opportunities that will achieve prosperous economic outcomes for the region and for Western Australia. We look forward to working with you to make the Blueprint Vision a reality. Chris Gilmour | CHAIRMAN “The future is not some place we are going but one we are creating.” John H. Schaar approximately 55% of New Zealand’s GDP and greater than the individual GDP of 127 of the world’s 189 nation states1. The Pilbara produces 95% ($62 billion) of the value Western Australia’s iron ore production. The region also services the north-west shelf oil and gas fields, which produce approximately two thirds of Australia’s oil and gas, worth $27 billion2. The Pilbara will remain a significant contributor to state and national economies. In March 2015, Western Australia had In 2050, the Pilbara will have 200,000 people living an estimated $179 billion worth of resource projects under in vibrant, modern and inclusive cities and construction or in the committed stage of development. A communities which offer quality services, career further $118 billion has been identified as being allocated choice, affordable living and a thriving civic life. to, planned, or possible projects in coming years3. The The economy will feature diverse, innovative and majority of these projects are located in the Pilbara, such as resilient local and international firms underpinned Chevrons’ Gorgon and Wheatstone Liquefied Natural Gas by the resources and energy industries. (LNG) projects on Barrow Island and at Onslow respectively, the Roy Hill Iron Ore mine and expansions of current operating iron ore mines. The production timeframes for these projects range from years to many decades. The Pilbara is a globally significant mining and energy region boasting a wealth of resource endowments, dynamic However, the rapid growth and heavy reliance on resource communities, rich Aboriginal culture and stunning natural exports resulted in a range of challenging outcomes – the landscapes. The Pilbara of today offers a glimpse of what a region has a high cost structure, it is highly exposed to prosperous Northern Australia could be in the future with commodity price fluctuations, and regional towns do not sustained strategic investment. possess the critical mass to support certain services and industries. Additionally, geographic dispersion, community The Pilbara region, located in northern Western Australia, service availability and income inequality present accounts for 20% of the state’s total land mass. Its challenging social issues. 507,896km2 equates to two thirds of the area of New South Wales, is twice the size of Victoria and more than five times The Government of Western Australia recognises the bigger than Tasmania. A population of just 67,000 people importance of a prosperous and secure future for the call the Pilbara home. While the Pilbara’s Aboriginal Pilbara, a region that contributed more than $5 billion to population make up 12% of the total population, there is a state royalties in 2013/14. It’s landmark $1.7 billion diverse mix of cultures and nationalities. Royalties for Regions Pilbara Cities initiative has contributed significantly to addressing these challenges, with Pilbara In the last decade the Pilbara has been the powerhouse of townships receiving considerable public and private sector economic growth for Western Australia and the nation. Its investment in amenity and liveability enhancements over proximity to Asia and extensive resource endowments have the past five years. This investment has allowed Pilbara to resulted in the Pilbara being recognised as a region of global move towards the levels of services and amenity usually significance. expected for a similar sized population, creating a strong sense of permanency for settlements that bore the legacy The Pilbara’s share of Australia’s Gross Domestic Product of mining towns. (GDP) has risen from 2% in the late 1990’s and early 2000’s, to 6.2% in 2014. The size of the Pilbara’s economy is consolidated and integrated approach to the growth and However, the remaining challenges to growth, community development of the region. development and economic diversification in the Pilbara will require a coordinated, whole-of-business, government The Blueprint is the product of extensive engagement and and community approach to achieve a sustainable future analytical understanding of the region. It is structured and for the Pilbara to 2050 and beyond. formulated by the Pilbara Development Commission (the Commission) but incorporates the efforts, skills and The Pilbara Regional Investment Blueprint (the Blueprint) knowledge of local government, key state and federal establishes the following Vision: government
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