MERIWA Annual Report 2001-2002

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“To encourage the development of the

Minerals and Energy Industries within the

State by fostering and promoting all aspects of minerals and energy research” MMIIINNEERRAALLSS AANNDD EENNEERRGGYY RREESSEEAARRCCHH IIINNSSTTIIITTUUTTEE OOFF WWEESSTTEERRNN AAUUSSTTRRAALLIIIAA

______Contents ______

Letter of Transmittal...... 1 Statement of Compliance with Relevant Written Law ...... 2 Functions ...... 3 Structure...... 4 Board of Directors’ Report ...... 5 Performance Measures...... 10 Minerals Research Advisory Committee...... 14 Minerals Research Advisory Committee's Report...... 15 Reports Published in 2001-2002...... 16 Projects in Progress as at 30 June 2002 ...... 23 Reports Not Yet Published as at 30 June 2002...... 25 Research Assistance...... 25 Financial Assistance from Industry ...... 26 Audited Statements...... 27 Performance Indicators ...... 28 Certification of Performance Indicators...... 29 Opinion of the Auditor General on Performance Indicators ...... 30 Statement of Financial Performance for Year Ended 30 June 2002 ...... 31 Statement of Financial Position for Year Ended 30 June 2002...... 32 Statement of Cash Flows for the Year Ended 30 June 2002 ...... 33 Notes to the Financial Statements ...... 34 Certification of Financial Statements...... 42 Opinion of the Auditor General on Financial Statements ...... 43

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______Letter of Transmittal ______

MINERALS AND ENERGY RESEARCH INSTITUTE OF WESTERN AUSTRALIA

Annual Report 2001-2002

Hon. Clive Brown, MLA Minister for State Development Parliament House PERTH WA 6000

On behalf of the Board of Directors, I am pleased to submit the Annual Report of the Minerals and Energy Research Institute of Western Australia (MERIWA) for the year ending 30 June 2002, for your information and presentation to Parliament.

MERIWA's objectives are to promote and co-ordinate research for the development of the minerals and energy industries in this State, and the Board is satisfied with the results of MERIWA's operations for the year and its performance towards the achievement of these objectives.

The Board acknowledges the valuable support given to the Institute by your office and by the Department of Mineral and Petroleum Resources during the year, and by the Minerals Research Advisory Committee, the members of which have contributed their time and assistance in an honorary capacity.

C D Branch Chairman Board of Directors

21 August, 2002

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Statement of Compliance with Relevant Written Law

Enabling Legislation

The Minerals and Energy Research Institute of Western Australia is established under the Minerals and Energy Research Act (No. 89 of 1987) to carry out the functions as set out in Section 5 of that Act.

Legislation Administered

The Institute does not administer legislation.

Legislation Impacting on the Institute's Activities

In the performance of its functions, the Institute complies with the following relevant written laws:

♦ Financial Administration and Audit Act, 1985; (FAAA);

♦ Public Sector Management Act 1994;

♦ Written law affecting agencies and activities subject to audit by the Auditor General;

♦ Electoral Act 1907.

In the financial administration of the Minerals and Energy Research Institute of Western Australia we have complied with the requirements of the FAAA and every other relevant written law, and exercised controls which provide reasonable assurance that the receipt and expenditure of moneys, the acquisition and disposal of public property and incurring of liabilities, have been in accordance with legislative provisions.

In its general administration, MERIWA has also complied with public sector standards for human resource management and the code of ethics and code of conduct, as required by the Public Sector Management Act 1994, and report that no applications for breaches of these standards have been lodged during the 2001/2002 year.

At the date of signing, we are not aware of any circumstances, which would render the particulars included in this statement misleading or inaccurate.

R E Butters C D Branch DIRECTOR AND CHAIRMAN, PRINCIPAL ACCOUNTING OFFICER BOARD OF DIRECTORS

21 August, 2002

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______Functions ______

The Minerals and Energy Research Institute of Western Australia (MERIWA) was established under the Minerals and Energy Research Act, 1987 (No. 89 of 1987), and is a statutory authority. The Institute’s function as defined by the Act is to encourage the development of the minerals and petroleum industries within the State by fostering and promoting all aspects of minerals research through:-

(a) undertaking, in its own right or in conjunction with other persons, such research projects as it thinks fit, and evaluating research projects so undertaken;

(b) investigating matters, and undertaking research projects relevant to the development of those industries, referred to it by the Minister;

(c) co-ordinating, when appropriate and practicable, research projects undertaken by persons who -

(i) have received financial assistance or any other form of support from; or

(ii) seek or agree to have their research projects co-ordinated by, the Institute;

(d) receiving and considering applications from persons undertaking or wishing to undertake research projects and seeking financial assistance from the Institute;

(e) allocating, at its discretion, to persons out of the Account, financial assistance to enable or assist persons referred to in paragraph (d) to undertake or continue research projects;

(f) entering into agreements with persons to whom the Institute has allocated financial assistance with respect to the terms and conditions of the allocation of that financial assistance, which terms and conditions may include a condition that such a person shall comply with any directions or guidelines issued by the Institute in relation to the conduct of a research project;

(g) monitoring and evaluating research projects in respect of which the Institute has allocated financial assistance and other minerals research work within the State and elsewhere;

(h) maintaining within the Department of Mineral and Petroleum Resources a collection of all reports or other literature or information issued or compiled by the Institute or by the Mining Institute;

(i) conferring and collaborating on matters relating to minerals research with the Department of Mineral and Petroleum Resources and other appropriate authorities and institutions within the State and elsewhere; and

(j) promoting public awareness of matters relating to minerals research, informing the public concerning the latest developments in the fields of minerals research and receiving and considering submissions from the public concerning -

(i) the performance by the Institute of its function; or

(ii) matters relating to minerals research in general.

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______Structure ______

MINISTER FOR STATE DEVELOPMENT THE HON CLIVE BROWN, MLA

BOARD OF DIRECTORS

DR C D BRANCH EMERITUS PROFESSOR A R BILLINGS CHAIRMAN THE UNIVERSITY OF WESTERN AUSTRALIA

MR R E BUTTERS MR S R BAKER COMPANY SECRETARY/CONSULTANT CONSULTANT

MINERALS RESEARCH ADVISORY COMMITTEE CHAIRMAN: PROFESSOR ODWYN JONES

PROJECT COORDINATOR EXECUTIVE OFFICER DR PAMELA SMITH MR DAVID MILTON

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______Board of Directors Report ______

MERIWA is a Statutory Authority established under the TABLE 1: SUMMARY OF RESULTS Minerals and Energy Research Act (1987) to promote (MINERALS RESEARCH) minerals and energy research which will encourage the development of the Minerals and Petroleum Industries in 2001/02 2000/01 this State. The desired outcome is that the amount of $'000 $'000 research undertaken will achieve the level of FINANCIAL technological advancement required to meet the future technical challenges of these industries, ensuring their ACCUMULATED FUNDS competitiveness and hence continued development. Opening balance at 1 July 361 188

MERIWA’s financial results and research achievement COST OF SERVICES for 2001/2002 are summarised in this report from the Total operating expenses 816 597 Board. The outputs produced and performance Less other revenues 84 112 indicators are examined in more detail in a later section Net cost of services 732 485 of the report, as well as the detailed financial statements REVENUE FROM GOVERNMENT for the 2001/2002 year. Total revenues government & industry 2 174 1 589 Less research grants – ind. sponsorship 1 545 931 Overview Net revenue from government 629 658

MERIWA’s financial results and research achievement Change in net assets from operations (102) 173 for 2001/2002 for minerals research are summarised and Closing balance of accumulated surplus 259 361 compared with the results for 2000/2001 in Table 1. Points of note for the year are - RESEARCH ACHIEVEMENT

♦ Total value of new minerals research projects was RESEARCH GRANTS $2.079 million, an increase of $0.637 million on the • Minerals Research 531 480 2000/2001 figure of $1.442 million. INDUSTRY SPONSORSHIP • ♦ Coordinated through MERIWA 1 548 962 Industry sponsorship was $1.548 million compared • Handled separately - - to $0.996 million in 2000/2001. The proportion of • Joe Lord Memorial Scholarship - 34 industry sponsorship for minerals research was 74% Total industry sponsorship 1 548 996 against a target of 65%. Total value of research commenced 2 079 1 442 ♦ For every dollar expended by the Government % sponsorship to new research through MERIWA, $2.60 of minerals research was commenced (minerals only) 74% 69% generated. Ratio of research value (minerals) to government funds utilised ♦ Administration costs as a % of the value of research (grants and administration) 2.60 2.62 generated were 8.83%

♦ Compared to previous years MERIWA finished the Brankovich being supplemented by an analysis of the year reducing the carried surplus by $102,000. benefits of MERIWA projects written by John McIlwraith based on material prepared by members of As part of the Government policy to review all statutory MRAC. Dr Ken Spillman has reviewed and edited the authorities, Chris Fitzhardinge was appointed by final manuscript which is to be published by University Minister Clive Brown to review MERIWA. It is of Western Australia Press as “The MERIWA Effect”. pleasing to note that the report recommended MERIWA remain a statutory authority, but before a final decision Transfer of Alternative Energy Research is made the relationships with the Resources Institute and Australian Resources Research Centre (ARRC) will Alternative energy research activities were transferred to be considered. the Alternative Energy Development Board (AEDB) on July 1, 1995. Because the legislative changes required The compilation of MERIWA’s history to celebrate 21 for the AEDB to operate autonomously within the Office years of operation in 2002 has progressed, with the of Energy are not yet in place, alternative energy historical documentation researched by Jasmina research funding is included in the financial statements

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______Board of Directors Report ______(Continued)

Table 2: Allocation of Funds (Minerals Research) Table 3: Allocation of Mineral Research Funds to Research Organisations Research No. MERIWA S/ship Total categories projects $'000 $'000 $'000 Research No. Funding Organisation projects $'000 MINERALS Geoscience 1 75 140 215 MINERALS Hydrocarbons 1 44 140 184 The University of Western Australia 3 421 Engineering 3 280 1 038 1 318 Curtin University of Technology 3 724 Minerals processing 1 8 15 23 Murdoch University - - Environmental- Edith Cowan University - - rehabilitation 3 124 215 339 Other 3 934

Total 9 531 1 548 2 079 Total research 9 2 079

SCHOLARSHIPS given later in this report. As alternative energy research The University of Western Australia 1 20 will be reported separately by the Office of Energy, all Murdoch University - - comments in this report are restricted to minerals and Curtin University of Technology 1 20 Edith Cowan University - - petroleum research. Total scholarships 2 40 Minerals Research Activities Total funding 2 119 MERIWA’s minerals and petroleum research results are identified separately in Table 4. Nine new research projects were commenced in 2001/2002 for a total value Table 2 shows the allocation of funds among different of $2.079 million. This compares with $1.442 million in research areas as well as the industry support achieved in 2000/2001. It is evident that there is an increase in each, while Table 3 shows the organisations that have mining and engineering and environmental research contracted to undertake MERIWA research projects and which indicates a strengthening of the minerals sector. have been recipients of MERIWA post-graduate scholarships this year. New industry sponsorship coordinated through MERIWA for the year was $1.548 million, while at The quality of research projects, their innovation and year’s end the sponsorship vested under MERIWA potential benefits to Western Australia continue at a very control was $4 121 217. Industry sponsorship for the high standard. year in review was 74% of the research value of projects against a target of 65%. This year we have sponsored nine projects, three from the engineering sector and three from environmental– After accounting for funds resumed from abandoned rehabilitation with one each from geoscience, projects and projects completed below budget the hydrocarbons and mineral processing. Both Curtin government funds utilised by MERIWA for minerals University of Technology and the University of Western research including resources received free of charge Australia have been successful in having three projects totalled $815 876 of which $553 756 were applied to each. Importantly we have seen outside research groups research grants and $40 000 to scholarships, with the successful in receiving funds. The minerals sector has remainder for administration. The actual administration shown an increase in confidence and is strategically cost of $137 187 was 8.83% of the value of research investing in research with potential short and long term generated. Real expenditure on new applications was benefits for core providers of expertise. $530 832. The importance of Curtin’s Kalgoorlie based Western Australian School of Mines was enhanced this year with The prognosis for 2001/2002 that MERIWA’s revenue two projects commencing. Both these projects under the and hence outputs could reduce compared to the direction of Professor Ernesto Villaescusa are related to previous years because of the problems facing the engineering and mine safety and testing methodologies. resources industries fortunately proved incorrect with a Project M333 will provide quantitative measures related resurgence of mineral industry activity. to rock bolt corrosion in differing local environments and provide predictive tools for minimising corrosion. The forecast for the coming year is cautious but may be In parallel with this project M349 is developing test stimulated by an improvement in the petroleum sector.

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______Board of Directors Report ______(Continued)

apparatus and methods to determine the behaviour of pleased with sponsoring these types of projects which ground support under dynamic loads. This work has are about reducing or eliminating long term risks to been recognised as probably leading to an international industry workers. standard test. In addition the Australian Centre for Geomechanics was successful in getting strong support In a research climate which is now more nationally and for the second phase (Project M355) of developing internationally based, concepts and ideas also develop, methods of interpreting and managing risk associated based on work completed elsewhere. Associate with mine seismic events. This follows on from project Professor Mike Dentith of the University of Western M328. The strong and consistent support from those Australia is conducting analysis of deep high resolution companies in the state now engaged in deeper seismic reflection profiling around the major gold underground mining is encouraging. An important deposits in the Laverton area. Based on some development with these projects and their predecessors observations made on similar Canadian work the is the improved skills and knowledge of the graduates Laverton study has tackled issues of thick weathered and associated research staff which are often taking up materials ubiquitous to the test region. The initial employment with sponsors. There is also an increasing seismic work was carried out in conjunction with an tendency for companies to second personnel to the Australian Geological Survey Organisation regional research groups. traverse which will also add valuable information to the project. This type of work is fundamental to In the environmental areas we are also seeing closer understanding the larger settings of major ore bodies and working of both research groups and companies. In the mineralising systems. Such understanding underpins case of project M344 looking at the nutrient absorption future mineral discoveries. capacity of waste material from the production of synthetic rutile the sponsoring companies are responsible In the petroleum and gas industries, fundamental for the research using the scientific skills of CSIRO. geological understanding of the depositional environ- This is a result of the companies having carried out ments of source rocks is an important exploration tool. extensive tests and trials over many years and needing to Drs Fiona Burns and Annette George of the University collaboratively develop the scientific understanding of of Western Australia are continuing to develop our the processes. This project has the potential to improve understanding of the trace fossils within the rock the environmental issues not only for the synthetic rutile sequences associated with the north west shelf areas. process but for community environmental issues relating to phosphorous and nitrogen in waterways. The diversity of research being carried out for the benefit of the development of the mineral and petroleum Professor Byron Lamont of Curtin University is studying industries and supported by MERIWA is great. For the environmental impact of kangaroos grazing on instance Dr John Livingstone of the University of rehabilitation areas in the SW of the state. This more Western Australia is testing new applications for the use holistic approach to successful rehabilitation after of tantalum and silicon. These electronic and bauxite mining, is a step to better understanding the photovoltaic investigations could lead to new and novel sustainability of complex flora and fauna systems. The applications for this material of which WA is a major impact of fauna and other natural components on flora producer. The Board and MRAC are supportive of such rehabilitation is poorly understood. This study will give diverse projects and has consistently encouraged and a clear, scientific basis for improving diversity in flora supported a wide range of research topics. rehabilitation by identifying various management strategies for herbivores and their effectiveness. Scholarships In keeping with its policy to encourage PhD students to Dr Tim Inglis of the Health Department has been embark upon careers in the minerals and petroleum successful in gaining support for research into industry, MERIWA has again offered Supplementary understanding more about occupational health risk of a Scholarships to help finance students and their projects. semi-tropical disease called Melioidosis. This project is Each comprises a $5 000 per annum stipend and $5 000 clearly about understanding issues of distribution and the per annum for project maintenance. Twelve applications extent of this bacteria which has a potential to infect for were received and it was encouraging to see the up to 30 years after exposure, sometimes with fatal continuing high quality of the applications and the consequences. The mining industry support reflects diversity and potential of many of the projects being industry managers who have embraced the need to have pursued. The selection committee awarded two good information on risks to their employees so the risks scholarships, one to Mr James Hos and one to Mr Daniel can be effectively managed. MERIWA is particularly Helm.

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______Board of Directors Report ______(Continued)

James Hos started his PhD studies on synthesising resulting in a for the year of ($102 274). The ceramic materials for fuel cell membranes in March accumulated surplus carried forward is $258 649. 2001. He is working with Ceramic Fuel Cells Limited, Advanced Nano Technologies and carrying out this Publications work at the Centre for Advanced Minerals and Materials Processing, University of Western Australia. His Thirteen final reports on minerals projects were research topic is titled “Mechnochemically Synthesised published during the year and distributed in CD-ROM Materials for Intermediate Temperature Ceramic Fuel form to technical libraries in Western Australia and Cells”. Fuel cell technology is advancing rapidly and interstate. A synopsis of each of the reports is included the new generation of ceramic-oxide cells will be using in later pages of this document plus an additional mainly fuels such as methane and LPG which abound in summary from the previous year which was Western Australia. The new cells have potential to inadvertently omitted. lower the temperature of operation and hence reduce the capital cost while maintaining the benefits of high The number of reports published by MERIWA since its energy efficiencies. James’ work combines the local inception now totals 217, and it has been pleasing to see expertise in producing nano powders of rare earth oxides an ongoing demand for copies of them. Reports in hard with his skills in material engineering and chemistry to copy, microfiche or CD-ROM are provided to produce these specialised cell membranes. The potential companies or private individuals on request, at nominal benefits of this work are those of world class advanced prices, sufficient to recover the cost of reproduction. In manufacturing industries using local materials and 2001/2002, eight microfiche, 24 hard copy and two CD- intellect. ROM format reports were sold, producing revenue of $2 399.75. Daniel Helm has a first class honours degree in Minerals Engineering and Extractive Metallurgy from Curtin Reports are now produced on CD-ROM and not University of Technology, Western Australian School of microfiche, as well as in hard copy format for archival Mines (WASM) campus. He is continuing his academic purposes. development in the area of extractive metallurgy at WASM’s Nickel Hydrometallurgy Research Group, Office Services which is part of the A J Parker CRC for Hydrometallurgy. His topic is “Control of Precipitation Services provided by the Department of Mineral and and Crud Formation in the Direct Solvent Extraction of Petroleum Resources, notably the provision of office Cobalt”. Over the past three years, three major space, along with its continued support in associated hydrometallurgical operations to extract nickel and areas, are much appreciated by the Board. cobalt have commenced operations in the Kalgoorlie region. In part of the process, unwanted materials (crud) Code of Conduct for Government Boards either precipitate or form on the surface of the liquids and Committees and result in metal loss or production inefficiencies. Daniel’s work is expected to improve the knowledge of The Board and the Minerals Research Advisory crud and its control. Committee adopted individual Codes of Conduct in Finance accordance with the recommendations of the Commissioner of Public Sector Standards. The financial statements for MERIWA for 2001/2002 appear later in the report. As the legislation for the Staff and Committees transfer of alternative energy research is still not in place, the financial results for alternative energy and Members of the Board note with sadness the sudden and minerals research have to be consolidated. However, the tragic passing of Chris Powell. Chris was for eleven and results associated with minerals and petroleum research a half years a member of our Minerals Research are identified separately. Advisory Committee representing the University of Western Australia. He served ably and generously as For minerals research, the budget appropriation was Chairman of our Geology Sub-Committee. $612 000, and total revenues from services were $84 102 comprising mainly interest. The net cost of services rose The Board again acknowledges the valuable assistance from $451 240 in 2000/2001 to $731 774, while net that has been provided to the Institute by the Minerals revenues from government rose by $5 650 to $629 500, Research Advisory Committee under the able Chairman-

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ship of Professor Odwyn Jones. Both the members and deputy members met on a regular basis during the year, in sub-committee or in committee, to assess the research proposals received, and to advise the Board of their suitability and technical merit before grants were approved. This takes considerable time, and as the great majority is provided on an honorary basis, MERIWA is most appreciative of this contribution.

Finally, the Board acknowledges the contribution and competence of the four part-time contractors and consultants in coordinating and administering the affairs of the Institute.

C D Branch CHAIRMAN, BOARD OF DIRECTORS

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______Performance Measures ______

MERIWA’s Minerals Research Program level of technological advancement required to meet the future technical challenges of these industries, and helps MERIWA’s mission is: ensure their competitiveness and continued development.

“To encourage the development of minerals and Promotion of Research energy industries within the State by fostering and promoting all aspects of minerals and energy research". The key incentive provided by Governments to encourage more research is to subsidise its cost. Mineral deposits and oil and gas accumulations are Government research funding schemes generally provide finite, and new discoveries must continue to be made this subsidy on a dollar-for-dollar basis, in which case and developed to replace depleted deposits. If this is not the amount of research undertaken is theoretically achieved, and the industry does not sustain itself but doubled. MERIWA’s policy has been to reduce the slowly degenerates, the effects on the State’s economy magnitude of the subsidy to nominally 35% of the cash would be quite disastrous. cost, encouraging a higher level of participation from Much of the industry is international, and companies industry. This not only allows a larger volume of operating internationally will compare the prospectivity research to be supported, but ensures that the key and exploration and mining costs in Western Australia objective of promoting research relevant to industry is with those applying in other countries, before deciding more likely to be achieved. on where their exploration budget will be most The level of subsidy must be such, however, to allow profitably spent. Investment in mining project MERIWA to maintain the authority to rigorously assess developments are also made on the quality and costs of research programs and to establish “Conditions of supporting services such as infrastructure but also in the Grant” that facilitate coordination and accountability, more downstream processing orientated industries the and ensure that final reports can be published and widely availability of highly skilled technical “problem solvers”. distributed. The subsidy must be of a level to enable promotion of research on regulatory issues such as Western Australia has established itself as a reliable occupational health and safety and minesite provider of not only physical resources to the world but rehabilitation. also as centre for excellence in many areas of mineral and hydrocarbon research. The Board of MERIWA continues to foster and encourage this “intellectual” Value of Minerals Research Financed development process with the knowledge of past Jointly with the Minerals and Petroleum experiences that industry, research institutes, Industries government and individuals profit from investments in “ideas”. The table below compares the value of research commenced for each of the last five years, jointly There is also a continuing need to promote research on financed by MERIWA and industry sponsorship. The regulatory issues of concern to the community at large, levels of research funding has fluctuated over the period, such as minesite rehabilitation, tailings disposal and a direct reflection of industries economic performance. containment, as well as occupational health and safety In the two years 1999 to 2001 a severe down turn issues in the industry. The advances made in these fields occurred in both the minerals and hydrocarbon industries and the support from the mining industry in undertaking and resulted in low levels of research activity. The up this research have been excellent over recent years. swing in commodity prices and better long term prognosis for resources industries is reflected in the To achieve its mission, MERIWA aims for an outcome higher levels of investment in the past year. It is by which the amount and quality of research undertaken expected that the levels of investment will remain within by the Minerals and Petroleum Industries achieves the these limits for the foreseeable future capped mainly by the limited funds available from budget appropriation.

$'000 2001-02 2000-01 1999-2000 1998-99 1997-98

Value of minerals research commenced 2 079 1 442 1 436 2 721 1 947 Scholarships 40 40 35 25 50 Industry sponsored scholarship - 30 - - - Total 2 119 1 512 1 471 2 746 1 997

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______Performance Measures ______(Continued)

2001-02 2000-01 1999-2000 1998-99 1997-98

Industry sponsorship achieved 74% 69% 68% 82% 75% Target 65% 65% 65% 65% 70%

Industry Participation ♦ Publication of reports gives all companies relatively cheap access to the technology. Industry participation is encouraged by MERIWA through every phase of a project. ♦ Publication benefits the researchers and their institutions, by enabling their work to be ♦ Industry involvement from the initial draft proposal acknowledged internationally and increasing their stage ensures that the project is focussed to its profile professionally. This attracts students and particular needs. external funding, which in turn is beneficial to both industry and the State. ♦ Industry sponsorship encourages ongoing participation through regular sponsor meetings; this MERIWA has now published 217 reports on the various creates closer communications between industry and research projects it has supported since its inception. the research groups and is beneficial to both sides. CD-ROM copies are distributed widely to all relevant technical libraries in Western Australia and to most ♦ Its investment in the research means that the research Australian universities. Reports in microfiche, CD- results are more likely to be applied. ROM or hard copy format are sold to industry at prices which cover production and distribution costs. The table ♦ Its participation facilitates the provision and below shows that 2,711 research project reports have availability of data to the research group, and by been distributed to industry and technical libraries over working closely with researchers, creates a more the past 5 years. research and technically oriented industry, and a more practical research group attuned to the technical Synopses of all reports published during 2001/02 are challenges faced by industry. included in this annual report, and complete lists of reports available are included with the twice-yearly The table above shows the average level of industry publication “Research News” and on the MERIWA sponsorship achieved as a percentage of the research value. webpage. Technology Transfer Performance Measures Research benefits will best eventuate if the results are made widely available and are applied. The importance The predominant measure of performance is the value of of this aspect of MERIWA’s operations is recognised in research undertaken, but as MERIWA is often limited by the functions of the Institute as listed in the Minerals and the funds available, its effectiveness is measured by the Energy Research Act (1987). Because of their financial ratio of the total value of research commenced to the commitment and participation throughout the study, Government funds utilised. sponsoring companies require a return on their research investment by application of the results. In a broader, MERIWA measures its efficiency by the administration industry-wide sense, however, technology transfer is cost as a percentage of the value of research generated. encouraged by publication of the final reports and their This is calculated on a three-year moving average basis distribution to all university, CSIRO and state technical to reflect the average duration of projects, covering the libraries, or by the provision of copies directly by MERIWA. project development assessment and funding phase, coordination while in progress, and the final reporting The benefits of publication are two-fold: and publication phase of the project.

No. of reports distributed or sold 2001-2002 2000-2001 1999-2000 1998-99 1997-98 Microfiche 8 394 250 511 511 Hard copy 66 73 55 135 150 CD-ROM 527 10 19 2 - Total 601 477 324 648 661

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______Performance Measures ______(Continued)

Effectiveness

The table below indicates that for every dollar of government funds expended on research in 2001/2002 (excluding scholarships), $2.60 of research was commenced.

2001-2002 2000-2001 1999-2000 1998-99 1997-98

Ratio of research value to government funds utilised 2.60 2.62 2.67 4.11 2.85

Efficiency

MERIWA's overall efficiency improved in 2001/02 due to increased value of research commenced and decreased administration costs.

2001-2002 2000-2001 1999-2000 1998-99 1997-98

Administration cost as a percentage of value of research generated 8.83 9.00 7.32 6.06 6.58

Table 4 summarises the key components of MERIWA's performance over the past five years.

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______Performance Measures ______

Table 4: MERIWA results (Minerals research)

Factors 2001/02 2000/01 1999/00 1998/99 1997/98

PROJECTS Applications received 16 10 7 11 21 Projects commenced 9 8 7 12 9 Projects completed 4 8 18 14 13

TECHNOLOGY TRANSFER No. reports published 13 8 5 10 10 No. microfiche issued or sold 8 394 250 511 511 No. hard copies issued or sold 66 73 55 135 150 No. CD ROM copies issued or sold 527 10 19 2 - Other publications (Research News) 2 2 2 2 2

FUNDS UTILISED ($’000) Budget appropriation 612 611 606 583 582 Interest on cash flow 81 110 90 75 81 Other income 32227 Transferred from (to) reserves 102 (173) (164) 2 12 Total Government funds utilised 798 550 534 662 682 Less administration costs 137 174 165 141 141 Funds utilised to support research 661 376 369 521 541

MERIWA GRANTS For research projects 531 480 453 496 491 For scholarship 40 36 35 25 50 Total grants 571 516 488 521 541

INDUSTRY SPONSORSHIP Coordinated through MERIWA 1 548 962 983 1 443 660 Coordinated separately - - - 782 796 Joe Lord Memorial Scholarship - 34 --- Total industry sponsorship 1 548 996 983 2 225 1 456

Total value of new research projects 2 079 1 442 1 436 2 721 1 947

Value of research generated to government funds utilised 2.60 2.62 2.67 4.11 2.85

Administration cost to value of research generated* 8.83% 9.00% 7.32% 6.06% 6.58%

* Three-year moving average

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______Minerals Research Advisory Committee ______

Nominated by the Professor I O Jones Consulting Mining Engineer Minister (Chairman)

Mr J G D Crone Consulting Mining Engineer (Deputy Member)

Dr A Bagshaw Australian Mineral Industries Research Association

Mr P Lockyer Consulting Mining Engineer (Deputy Member)

Dr R Blanks Principal Metallurgist, Metskill Australia

Mr P Baillie Project Development Manager, (Deputy Member) Nopec International Pty Ltd

Professor P Garnett Executive Dean, Faculty of Communications Health & Science, Edith Cowan University

Assoc Professor J Cross Director, International & Commercial, Faculty of (Deputy Member) Communications Health & Science, Edith Cowan University

Nominated by: Dr D Martin Project Manager - South West Division, Department of Resources Development Mr R Hart Project Manager - New Business (Deputy Member)

Commonwealth Scientific Dr A Ord Project Manager, Division of Exploration & Mining and Industrial Research Organisation (CSIRO) Dr C Butt Chief Research Scientist, (Deputy Member) Division of Exploration & Mining

The University of Western Australia Professor C McA Powell Department of Geology & Geophysics

Professor R J Gilkes Department of Soil Science & Plant Nutrition (Deputy Member) School of Agriculture

Murdoch University Assoc Professor P May Division of Science & Engineering

Dr D Ralph Division of Science & Engineering (Deputy Member)

Curtin University Professor J McDonald Department of Exploration Geophysics of Technology Professor R T Pidgeon School of Applied Geology (Deputy Member)

Chamber of Commerce Mr R Watsford Technical Manager, and Industry of WA WMC Nickel Business Unit

Mr W S Sashegyi Manager, Industry & Energy Development (Deputy Member)

Chamber of Minerals and Mr P Dowd Group Executive - Operations Energy of WA (Inc.) Normandy Mining Limited

Ms J Aberdeen Executive Officer - Environment (Deputy Member)

Australian Petroleum Mr K Spence General Manager, Northern Business Unit, Exploration Association (Deputy Chairman) Woodside Energy Ltd.

Dr J Gorter Senior Explorationist, (Deputy Member) Agip Australia Limited

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______Minerals Research Advisory Committee ______

It was business as usual although there were winds of Once again MRAC mourned the loss of one of its change “in the air” during MERIWA’s twenty first year members. Professor Chris Powell’s sudden and tragic of operation. The Minerals Research Advisory death whilst travelling to an international geological Committee (MRAC) met on seven occasions when nine function was a great loss to us all. As Chairman of projects were approved for the consideration of the MRAC’S Geoscience Sub-Committee he was one of Board. This involved the Sub-Committees in the usual our longest serving members and his advice and tasks of meeting with the researchers and exploring the guidance as one of the State’s leading researchers will technical merit of projects with the assistance of be sorely missed. nominated referees and assessors. Following are the fields of study relating to the nine approved projects: Finally let me pay tribute to my fellow members for their unstinting support for MERIWA’s cause as Hydrocarbons 1 MRAC members. Despite their busy work schedules in Geoscience 1 industry or academia they still find time to carry out the Engineering 3 exhaustive examination of the research projects Mineral Processing 1 submitted to MERIWA. My thanks are also extended Environmental 3 to the Board of Directors for maintaining such a harmonious relationship between the Board and MRAC The total value of these projects was $2,079,000 of and of course to MERIWA’s staff which include David which MERIWA supplied $531,000 which continues Milton, Executive Officer, Dr Pam Smith, Project the impressive record of MERIWA in attracting high Coordinator and Gwen Davies, Secretary. levels of industry support for the projects it approves and manages. The financial leverage for the past year was almost $3 from industry for every $1 of State government funds allocated by MERIWA. This was a notable achievement at a time when industry was going through a rather difficult period.

As usual MERIWA advertised the availability of Prof I O Jones supplementary scholarships for PhD students pursuing Chairman. research in relevant fields of study. Twelve applications were received, all of which were of a high standard. The two successful applicants were Daniel Helm from Curtin University’s WA School of Mines and James Hos from the University of Western Australia. Daniel is researching “Crud Formation in the Direct Solvent Extraction of Cobalt” whereas James is exploring the development of “Mechnochemically Synthesized Materials for Intermediate Temperature Ceramic Fuel Cells”.

The winds of change referred to earlier related to the review of the Government’s Statutory Authorities carried out as part of the machinery of government reforms. MERIWA was therefore reviewed as part of this process and it was pleasing to note the positive nature of the recommendations.

The task of compiling the history of MERIWA’s first twenty years of operations continued. This involved much work by all MRAC members and it will be pleasing to see the final publication which is being coordinated by Dr Ken Spillman.

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______Reports Published in 2001/02 ______

M195 SYSTEMATIC DOCUMENTATION OF M238/ GOLD PROCESSING TECHNOLOGY ARCHAEAN GOLD DEPOSITS OF THE AMIRA YILGARN BLOCK Report No 180 Report No. 193 Grantee: A J Parker Centre for Hydrometallurgy Grantee: The University of Western Australia Applicant: Professor I Ritchie Applicant: Prof D I Groves and Dr P E Playford Grant Amount: $780,000 Grant Amount: $239,790 Duration: 3 years Duration: 3 years Commenced: April, 1994 Commenced: October, 1992 Sponsors: Asarco Australia Ltd, Gold mining companies have an objective, as gold ores Aztec Mining Company Ltd, are mined at lower grades, of minimising the cost of BHP Minerals Ltd, processing and maximising gold recovery to sustain Billiton Australia Ltd profitability. To minimise the cost of processing, CRA Exploration Pty Ltd, reagents must be used effectively, operating reagent set Delta Gold NL. points must be realistic and safe, and reagent addition Dominion Mining Ltd, may be automated where possible. This project was Forrestania Gold NL, undertaken to conduct a process and operation review of Geopeko, leaching and gold recovery in terms of current practise Homestake Australia Ltd, and possible options for treatment of both free milling MIM Exploration Ltd, and refractory ores, and to develop methodology to Newcrest Mining Ltd, allow plant operators to minimise reagent costs while Normandy Poseidon Ltd, maximising gold recovery. Organised in three modules Orion Australia Pty Ltd, by AMIRA, the project activities consisted of a Placer Exploration Ltd. comprehensive literature review, an industry survey and review of sensors for pH, cyanide and dissolved oxygen, This collaborative project between the former Key and establishment of a database to assess processes Centre for Strategic Minerals Deposits (now Centre for including comminution, ore blending, gravity separation, Global Metallogeny) and the Geological Survey of leaching, sampling, analysis, carbon management and Western Australia had the objective of providing gold room activities. systematic documentation of mine workings with emphasis on the nature of host rocks, structural controls, The outcomes of the project were detailed in three wallrock alteration and ore mineralogy for the gold module reports, and include the following results: (1) deposits of the Yilgarn Block. This permanent record of generic solutions do not exist for the best pre-treatment gold deposits was compiled for use by the mining options in the gold recovery process; (2) project industry in both the recent and future exploration cycles. sponsors were brought up to date with use of sensors in To keep the project within time frame, the detailed CIP/CIL processing to reduce reagent consumption and studies were restricted to the eastern part of the Yilgarn improve plant performance, and sponsors were provided Block made up of the Southern Cross Province and the with an “Operators’ Manual” for Chemtronics and Eastern Goldfields Province, which is the most Teklogic titrators, and (3) a comprehensive database significant gold-producing region of the Yilgarn. based on a survey of current plant practise was compiled for sponsors’ use. The project’s output included complete data sheets for the 33 major gold-mining operations in the eastern Yilgarn Block, accompanied by colour plates showing representative sections and plans for each deposit. It also includes summary mine data-sheets for another 46 deposits and a brief report that gives an overview and interpretation of some shared features of the documented deposits. The majority of the Yilgarn deposits appear to fit in the class of orogenic lode-gold deposits, and the structural settings of these are investigated in some detail in the project overview, Part І of the final report.

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______Reports Published in 2001/02 ______

M270 THE ROLE OF NUTRIENT CYCLING IN M280 THE POTENTIAL OF THE FUNGICIDE THE SUSTAINABILITY OF YOUNG PHOSPHITE TO CONTROL PLANT COMMUNITIES PHYTOPHTHORA CINNAMOMI IN NATIVE PLANT COMMUNITIES Report No. 221 ASSOCIATED WITH MINING

Grantee: The University of Western Australia Report No. 209 Applicant: Dr M Adams and Dr D Jasper Grant Amount: $123,000 Grantee: Murdoch University Duration: 3 years Applicant: Dr G Hardy and Assoc Prof B Dell Commenced: April, 1996 Grant Amount: $206,368 Sponsors: Alcoa of Australia Ltd, Duration: 3 years Worsley Alumina Pty Ltd. Commenced: September, 1996 Sponsors: Alcoa of Australia Limited, Mine restoration programs have had the objective of Worsley Alumina Pty Ltd, rapid re-establishment and thus use the strategies of Gwalia Consolidated Ltd, planting fast-growing understorey species at high RGC Mineral Sands Limited, densities, and application of inorganic fertilizers to CRC Exploration Pty Ltd, encourage rapid early growth of vegetation. In this TiWest Joint Venture. study, the effects of such practises on tree biomass, leaf area, litterfall, leaf litter accumulation and nitrogen (N) Phytophthora cinnamomi or “dieback” affects jarrah availability and transformations were studied, as well as forest and other vegetation in Western Australia, and spatial heterogeneity of soil nutrients and litter. A methods of controlling it are crucial to rehabilitation chrono-sequence approach was used to compare nutrient management by mining companies. To assess whether cycling in mined sites with adjacent burnt and unburnt phosphite in foliar application is a practicable, economic mature jarrah forests. Jarrah saplings on mined sites and efficient way to control P.cinnamomi in native plant were found to re-grow quickly in the first 5-10 years communities in Western Australia, this project was after mining, with leaf area of re-growth stands possibly developed with five objectives. First, through fieldwork exceeding that of mature stands. Standing leaf litter was the efficacy of phosphite in preventing infection and sampled for comparison of amounts of Ca, Mg, Na, K subsequent colonization of P.cinnamomi in a range of and P in differing ages and in areal distribution. Of plant species was evaluated. Second, the potential of these, only P showed great variation between mined sites phosphite to prevent P.cinnamomi from sporulating from and native forest. Rates of litterfall were assessed, and P infected or treated plants was tested. Third, the in particular was found to have a low rate of return, that appropriate time of year to apply phosphite was to be may limit growth once the benefits of fertilizer determined. Fourth and fifth objectives were to find out application at site establishment diminish with time. whether phosphite affects plant health, flowering, seed Analysis of the distribution of litter at a 7 year-old mined set and viability, and if it is detrimental to site showed that microtopography is likely to have a ectomycorrhizae. In tests on preventing infection an significant impact on nutrient distribution and bio- optimum treatment level of 5g phosphite/L was found to availability in plant communities on mined sites. contain dieback colonization with little toxicity in five Further findings were that rates of C and nutrient species of the jarrah forest and eight species of the turnover in the mined sites studied are significantly northern sandy plain. For six native plant species different from those in mature forests and P cycling phosphite treatment reduced but did not prevent especially may be restricted at mined sites. Future colonization of roots by P.cinnamomi. For jarrah and establishment of plant communities on mined sites Banksia grandis 5-10 g/L phosphite reduced but did not which approximate those in mature forests will require prevent zoospore production. The benefits of phosphite re-assessment of site preparation practises and timing of application in spring and autumn varied between plant species introduction. A “slow growth” approach to species and communities. The effects on plant health restoration may prove more beneficial to re-growth and ectomycorrhizal fungi were varied. For three forest in the longer term. species of eucalypt, fungi were not adversely affected by phosphite, while in some species pollen viability was reduced for more than one year and in one species seed germination was affected. A number of recommendations are also presented in the final report.

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______Reports Published in 2001/02 ______(Continued)

M285 ACTIVATED CARBON RECOVERED M290 IMPROVING THE PRECISION OF FROM WASTES OF SYNTHETIC ECOTOXICITY TESTING PROTOCOLS RUTILE OPERATIONS IN WESTERN FOR CRUDE OILS AND DRILLING AUSTRALIA FLUIDS

Report No. 202 Report No 220

Grantee: The University of Western Australia Grantee: Curtin University of Technology Applicant: Dr C Halais and Prof P G McCormick Applicant: A/Prof L Evans and Dr Y Tsvetnenko Grant Amount: $192,500 Grant Amount: $330,000 Duration: 2 years Duration: 2 years Commenced: July, 1997 Commenced: April, 1998 Sponsors: Char International Pty Ltd, Sponsors: Woodside Offshore Petroleum Pty Ltd, James Cumming and Sons. Total Petroleum (S E Asia) Pty Ltd, BHP Petroleum Pty Ltd, With several synthetic rutile operations in Western Baroid Australia Pty Ltd, Australia, this project offered an opportunity to evaluate Baker Hughes INTEQ, possible cost-effective methods to recover activated M I Drilling Fluids UK Ltd, carbon, in granular and powder forms from Dowell Schlumberger (Western) S.A. carbonaceous wastes. An estimated 30,000 tonnes of activated carbon is discarded each year from the The North West Shelf produces crude oils that are highly operations’ reduction furnaces. Possible uses for the volatile, a characteristic not shared by most northern waste carbon include gold extraction, petroleum hemisphere crude oils. Because internationally accepted refining, water filtration and food processing toxicity test protocols are based on northern hemisphere applications. The activated carbon from the plants crudes, the LC50 values for North West Shelf tests have occupies a unique position in the marketplace, having a been significantly affected and therefore less accurate very high degree of mesoporosity combined with high for estimating environmentally safe levels of exposure in surface areas, and thus was hoped to have high potential the marine environment. In addition, test procedures for to be cost competitive. Conclusions that emerged from determining biodegradability of drilling muds often gave this research are as follows. The carbon product, which erroneous results. There were no test protocols for occurs in three different forms, is mixed with heavier tropical organisms relevant to the North West Shelf, or components after the synthetic rutile process. It may be for tropical conditions biodegradation. Thus the project separated from these by size, gravity or magnetic was designed with several objectives: (1) to evaluate the sorting. The heaviest of the three fractions may be influence of hydrocarbon volatility on crude oils toxicity radioactive, while the granular size may have quartz as a tests, (2) to develop test protocols to assess drilling fluid major contaminant and dust size is contaminated with toxicity, and select an appropriate sediment reworker for fine porous titaniferous particles; all the fractions of ecotoxicity tests, and (3) to develop reliable test carbon contain some reduced sulphur compounds and methodology for biodegradation tests on drilling fluids. are slightly magnetized. This form of activated carbon Results that pertain to each of these objectives were as contains high overall porosity and a high proportion of follows. First, laboratory tests at Curtin University’s mesopores which distinguish it from other forms; its Ecotoxicology lab showed that between 63% and 95% of high pore volume makes it inherently soft and unsuitable petroleum hydrocarbons from North West Shelf crudes for conventional gold processing but suitable for a wide evaporated in the 24 hours immediately following range of applications where adsorption of large preparation of water soluble fractions (WSF’s). A molecules is required. simple method for quantifying total petroleum hydrocarbon (TPH) concentration in WSF’s of crudes was developed and effects of parameters in TPH concentrations were evaluated. Secondly, a method of recording concentration changes in the course of static toxicity testing was developed. Third, it was determined that Isochrysis sp. offered the best reliability as a test species in toxicity testing, and a proposed standardized The above report was inadvertently omitted from last approach to reporting toxicity values for volatile crudes, year’s Annual Report for 2000/01 as well as weathered oils, was developed. Finally, a mathematical model for predicting toxicity effects from weathered oils was derived.

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______Reports Published in 2001/02 ______(Continued)

M297 EVALUATING TRAP INTEGRITY ON M303/ TEXTURE-BASED ENHANCEMENT THE NORTH WEST SHELF OF AMIRA AND CLASSIFICATION OF AERO- AUSTRALIA USING HYDRODYNAMIC MAGNETIC DATA ANALYSIS Report No 216 Report No 219 Grantee: The University of Western Australia Grantee: C.S.I.R.O. Petroleum Applicant: Dr M Dentith and Dr D Cowan Applicant: Dr C Otto and Dr N Yassir Grant Amount: $180,160 Grant Amount: $490,000 Duration: 2 years Duration: 3 years Commenced: January, 1998 Commenced: August, 1997 This AMIRA project to investigate the use of a textural Hydrodynamic analysis of well data has become a analysis method called “grey-level co-occurrence valuable E&P tool recently to help petroleum matrix” (GLCM) was based on recognition of two explorationists envision potential oil and gas traps, by fundamental properties in aeromagnetic data, variations studying pressures and movements of fluids and gases in amplitude and in texture. Changes in one or both of through formations. It allows determination of the these properties characterize data boundaries, which may pressure and fluid migration systems operating in a represent geologic contacts. When areas with similar given geologic framework in a region, including characteristics are mapped as single geologic entities a definition of fluid flow conduits and fault barriers, pseudo-geologic or rock magnetization map can be hydraulic continuity between different formations and produced. Standard practise had been to apply location of favourable trap areas. Hydrodynamic amplitude enhancement, but texture-based enhancement analysis can also yield elevation and tilt of fluid common in medical imaging and computer graphics was contacts. Differing basins in the North West Shelf, the not standard in pseudo-geologic mapping. Carnarvon Basin and the Timor Sea Basin, were studied to compare fluid flow within apparently diverse pressure In this project, tone (as roughly equivalent to amplitude) regimes, and to help provide a better understanding of and texture were both varied to create images. From the regional fluid flow pathways, explain the hydrodynamic start the wide range of parameters in the GLCM method environment of breached seals, and delineate new areas and the need to choose appropriate parameters were of potential hydrocarbon migration and entrapment. A recognised. new workflow scheme also was developed to conduct the analysis and interpretation, which is transferable to The main finding of M303 were: The method for other sedimentary basins. Other objectives of the project aeromagnetic data achieves maximum resolution by included interpretation of fluid flow mechanisms and analyzing the smallest area possible, and is robust with prediction of formation pressures. There were numerous respect to parameters selection. The textural component, important results of the study including: (1) Pressure- consisting of mostly shorter wavelength variations, is elevation analysis identified 6 major aquifer systems in primarily a function of shallow magnetic sources; the the regional North West Shelf. (2) Regionally the GLCM texture transform actually works best where general flow direction is from the basins’ depocentres rocks are poorly magnetized, and most such texture toward the onshore regions and upward to shallower transforms are sensitive edge-detectors. It remains aquifer systems. (3) Compaction-driven flow is the main difficult to directly relate features in texture transforms driving force for fluid flow in the North West Shelf. (4) to the ground distribution of magnetization. The Overpressured compartments are not hydraulically principal outcome of the project is a software package to isolated. Five faults act as fluid conduits between apply the GLCM method to gridded data in commonly hydrostratigraphic units, and migration pathways can be used formats such as ER-mapper. very complex due to the hydraulic nature of the faults and presence of overpressured compartments.

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______Reports Published in 2001/02 ______(Continued)

M309/ CYANIDE WASTE MANAGEMENT: M312 REHABILITATION OF SALT AMIRA MINIMISING ENVIRONMENTAL AND AFFECTED MINING LANDS USING ECONOMIC IMPACTS THE NATIVE HALOPHYTIC SHRUB HALOSARCIA Report No 214 Report No 225 Grantee: A J Parker Co-operative Research Centre Applicant: A/Prof P May and Mr R Schulz Grantee: The University of Western Australia Grant Amount: $690,700 Applicant: Dr T Colmer and Dr D Jasper Duration: 2½ years Grant Amount: $105,600 Commenced: January, 1998 Duration: 3½ years Commenced: May, 1998 This AMIRA project was conceived to evaluate Sponsors: Normandy Mining Limited, available methods for cyanide analysis in the laboratory Acacia Resources Limited, for suitability and robustness, and then combine these Placer (Granny Smith) Pty Ltd, data with measurements from tailings structures to carry Kalgoorlie Consolidated Gold Mine out conceptual, semi-quantitative and qualitative modelling. The intention of modelling is to understand Soil salinity throughout Western Australia is a major the fate of cyanide in tailings structures. A module was obstacle to sustainable land use and is an issue, not only also conducted to understand better the environmental in the agricultural zone, but also in the eastern goldfields chemistry and reactivity of cyanide, taking into account of the state. There mining produces saline land surfaces changes in pH, temperature and salinity/water activity, in the form of waste dumps and tailings storages, and by obtaining high quality quantitative chemical data for furthermore several mine sites operate very close to or core cyanide interactions. These data also were used in on the surface of salt lakes. This project arose due to the modelling the fate of cyanide. need to develop approaches to revegetating these disturbed saline land surfaces. One plant genus that had In the evaluation of cyanide analysis methods, those that been shown to have potential to revegetate saline proved reasonably robust and had validity across a wide substrates is Halosarcia, one of six genera in subfamily range of different matrices were recommended in a Best Salicornioideae to occur in Australia. Halosarcia Practise guide issued jointly by the Chemistry Centre of communities generally are the first vascular plants above Western Australia (CCWA) and MINTEK, South Africa. water line in salt lakes of the Western Australian arid None of the methods claiming or expected to report free zone; however, knowledge of this group of plants was cyanide is actually doing so, as all report varying limited although 23 species have been described. fractions of WAD cyanide also, and therefore a Previous work by the researchers had shown that H. combination of methods needs to be performed. Field pergranulata subsp. pergranulata, once established, can studies revealed the forms and concentrations of cyanide grow at salinities exceeding those found in mining after the deposition of tailings, included a mineralogical residues and may thus be useful in revegetation projects, investigation into the heavy minerals fraction, and gave but more information was needed. Another issue was particular results for WAD cyanide. Concurrent with the that identification of many of the taxa can be very investigation of the suitability and robustness of all difficult. The project therefore involved two studies, one feasible cyanide analytical methods, the CCWA addressing several unresolved taxonomic issues in the developed two new methods, using ionchromatography Australian Salicornioideae, and the second comparing and a sensitive sulphur spot test. Using these data and the ecophysiology of salt and waterlogging tolerance in measurements, a series of simple conceptual models of selected Halosarcia species. Results of the project how cyanide behaves in tailings structures were research included identification of potential new species, developed that represent what is known and currently and clarification of which plant features are useful in believed about the physicochemical fate of cyanide. identification. From the ecophysiological study, significant variation was found among species with respect to salinity and waterlogging tolerance and conditions for seed germination and seedling establishment, to be considered when selecting species for rehabilitation and to help focus research on niche habitats.

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______Reports Published in 2001/02 ______(Continued)

M317 THE TRANSPORT OF NEAR SURFACE M323 COMPARISON OF MOBILE METAL SALTS IN HYPER-SALINE GOLD ION (MMI) GEOCHEMISTRY AND TAILINGS AND THE IMPLICATIONS CONVENTIONAL GEOCHEMISTRY AT FOR DUST GENERATION BY WIND MINERALIZED SITES IN DIFFERENT ACTION GEOLOGICAL, CLIMATOLOGICAL AND REGOLITH SETTINGS Report No 217 Report No 206 Grantee: C.S.I.R.O. Applicant: Dr J Carras Grantee: Geochemistry Research Centre Grant Amount: $125,000 Applicant: Dr A Mann/Mr R Birrell Duration: 15 months Grant Amount: $109,980 Commenced: July, 1998 Duration: 1 year Sponsors: Normandy Kaltails Pty Ltd, Commenced: March, 1999 Kanowna Belle Gold Mines, Sponsors: Stockdale Prospecting Ltd, Paddington Gold Pty Ltd. Newcrest Mining Ltd, Ross Mining NL, The observation arose, from problems regarding dust in Pasminco Exploration, Kalgoorlie, WA in the 1960’s and 1970’s, that gold Anglo American Prospecting Services, tailings produced from new hyper-saline process water Normandy Mining Ltd, appeared not to produce dust, while tailings produced MIM Exploration Pty Ltd, from fresh water had produced the dust decades earlier. Teck Corporation. It led to this study intended to provide scientific guidance about whether hyper-saline tailings surfaces This comparison study of MMI response and are likely to become major dust sources if left uncapped. conventional geochemistry was carried out at nine The two objectives of the study were to carry out different sites world-wide, with the intention of laboratory studies of the behaviour of salt in the surface confirming previous trends if possible and of producing layers formed from hyper-saline tailings under repeated an Atlas of MMI response characteristics. The geologic wetting and drying, and to measure the dust yield settings of the mine sites were widely varied, including a potential of these surfaces when subjected to accelerated dry-climate base metals site in Mexico, and a humid- wetting and drying. If the behaviour in wetting and climate base metals site in Tasmania, gold prospects in drying aided dust inhibition, field trials would be Argentina, Queensland and Western Australia and indicated to assess how to apply such laboratory results. kimberlites in Australia, Canada and East Africa. In Simulated rainfall on and drying of selected tailings some settings the effects of weathering or climate samples from all three sponsor companies were carried conditions are suspected to be responsible for the out at CSIRO facilities in Canberra, and measurements geochemical response; for example in the Mexican made of the moisture and salt concentrations as a deposit lack of oxidation may be the reason that both function of depth from surface. The data from these MMI and total digestion gave insignificant contrast over tests showed that wetting and drying had little impact on the deposit. In contrast, the high rainfall area around the the near surface salt concentration; even following a Tasmanian mine showed contrast in both MMI and simulated downpour the salts concentration near the conventional analysis. In this case, MMI provided better surface re-established after further evaporation. Results spatial resolution of the massive sulphides than did total from a numerical model of water and salts transport gave digestion. At the Argentina site, MMI provided greater results that overlapped the lab data to an extent, and the amplitude contrast than did total digestion. At sites in model was used for a prediction of 10-year behaviour of Australia MMI analysis provided useable contrast over the actual tailings based on the 10-year actual rainfall mineralization under Tertiary cover or transported recorded at Kalgoorlie in 1966–1976. The results alluvium that was superior to the results after total supported the proposition that tailings can be left digestion. At two of the three kimberlite sites evaluated uncapped, but detailed measurement of properties of MMI analysis provided better resolution for several individual tailings was also recommended. elements than did total digestion. The report discusses the mechanism of capillary rise/evaporation, and an Atlas of case histories is available separately from the report.

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______Reports Published in 2001/02 ______

M341 TOWARD THE ELIMINATION OF M343 PHYSICAL MODELLING STUDY OF ROCKFALL FATALITIES IN SLEIPNER WEST CO2 SEQUEST- AUSTRALIAN MINES RATION: STAGE 1 – MODELLING THE SLEIPNER WEST OVERBURDEN Report No. 223 Report No. 224 Grantee: Australian Centre for Geomechanics Applicant: Professor Y Potvin Grantee: Curtin University of Technology Grant Amount: $115,000 Applicant: A/Prof B Evans and Mr J McKenna Duration: 1 year Grant Amount: $77,500 Commenced: December, 2000 Duration: 1 year Sponsors: Kalgoorlie Consolidated Gold Mines, Commenced: May, 2001 Peak Gold Mines Pty Limited, Sponsors: Australian Petroleum Cooperative Mount Isa Mines Limited, Research Centre. BHP Cannington, • Woodside Energy Ltd Sons of Gwalia Ltd, • BHP Petroleum Pty Ltd Outokumpu (Black Swan Nickel Mine), • BP Developments Australia Pasminco Limited, • Australian Greenhouse Office Normandy Mining Ltd, • Chevron Research and Technology Henry Walker Eltin, Company Darlot Gold Mine, Plutonic Gold Mine. The disposal of CO2 in gas production presents a significant environmental engineering problem, and the The Australian mining industry has rapidly become project was undertaken as the first stage in a two-stage aware that the issue of rockfall fatalities in the process to simulate CO2 sequestration. This stage of the underground mining cycle still requires a significant project had the objective of building the overburden of amount of attention. The Western Australian the Sleipner injection site to scale in the laboratory and Government introduced legislative requirements for recording 3-D seismic over this model to show that the improved geomechanics practises through regulations overburden geology could be simulated. The model was and the Mines Occupational Safety and Health Advisory built to a scale of 1:5000 from plastics and resins. This Board has provided a Code of Practise to introduce model was then placed in a water tank, its base standards across the whole sector. In the past decade representing the upper Utsira sand and a water gap ground support practises developed rapidly throughout simulating the sand aquifer reservoir. Densities were the Australian mining industry and a reduction in risk scaled to approximately 70% of field values while from rockfalls was the outcome. In 2000, the Australian physical model velocities were 100% of field velocities. Centre for Geomechanics undertook new research to Typical marine seismic data were then recorded using a improve understanding of the factors that contribute to similar acquisition method as for 3-D data acquisition in rockfalls and accelerate the elimination of injuries and the field. fatalities caused by rockfalls, in Australian underground mines. The intention of the project was to formulate a The ultrasonic model data were then processed, similarly better global understanding of the main causes of to the field data, and comparisons made with both field rockfalls, so that high risk areas can be identified and and numerically modelled data. The good comparison solutions developed to address these issues as part of a between physical and numerical modelling supported the system-based approach. The resulting extensive interpretation that this model–simulating technology was database offers a starting point to focus future efforts successful in simulating an overburden. There was a where benefits can be maximised, and the report offers good match between physical model and field data in numerous recommendations, including: (1) the industry both pre- and post-stack data, that the aggressive use of conduct a thorough assessment of control measures for matching filters was not required to produce. The next small rockfalls originating between bolts, and produce stage of the project will construct a pressure chamber relevant guidelines, (2) mine sites review their scaling and repeat the exercise under simulated pressure and ground support rehabilitation procedures to conditions. investigate whether their ground support is exposed to corrosive conditions, (3) further focussed studies be conducted in the area of ground support design, and (4) the results of this study be made widely available to the full cross-section of the industry.

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______Projects in Progress: 30 June, 2002 ______

Cash Notional No. Project Title Applicants Institute Term Cost Value (years) ($) ($)

M282 Resolution of subsurface structure of Hamersley Powell UWA/ 3 380 000 935 928 Province by multi-channel seismic reflection Carwood Curtin Dentith

M288 Development of an electrochemical corrosion Dr S Bailey Curtin 3 253 986 437 244 probe for use in oil and gas flowlines Mr B Kinsella

M289 Radiographic silicosis and lung cancer in Dr N de Klerk UWA/ 2 74 363 106 437 Kalgoorlie miners Prof A Musk Sir Charles Gairdner Hospital

M304 Genetic stratigraphic analysis of the Hamersley A/Prof M Barley UWA 2 180 000 402 596 Group Dr B Krapez

M313 Triassic palynostratigraphy of the Dampier sub- A/Prof D Haig UWA 2 292 000 392 400 basin

M321 Somatic embryogenesis and synthetic seed Dr K Dixon Kings Park & 3 221 500 289 400 technology for the production of Australian plants Botanic Garden for mining restoration with special emphasis on native heaths

M328 Mine seismicity and rockburst risk management Prof Y Potvin ACG 3½ 747 000 1 087 000 A/Prof R Jewell

M329 Stress measurements from cored rock Prof E Villaescusa WASM 2 229 000 474 000

M331 Shallow water tow-out issues in WA-based Dr K P Thiagarajan UWA 2 102 757 102 757 construction of concrete gravity structures for Dr B F Ronalds offshore oil and gas production

M332 Management of Rumex vesicarius L. on A/Prof J Osborne Curtin 2 79 000 114 600 rehabilitated mine sites in the goldfields of Dr A Schatral Western Australia

M333 Corrosion of rock reinforcement in underground Prof E Villaescusa WASM 3 368 000 638 511 excavations

M335 Application of trace fossil studies to depositional Dr F Burns UWA 18 141 724 151 859 facies analysis and stratal surface identification: Dr A George mths Middle Jurassic-Lower Cretaceous deltaic, estuarine and shallow marine systems, N W Shelf

M336 Molecular stratigraphy research for oil-source Prof R Alexander Curtin 2 220 900 254 300 rock correlation Prof R Kagi

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______Projects in Progress: 30 June 2002 ______(Continued)

Cash Notional No. Project Title Applicants Institute Term Cost Value (years) ($) ($)

M338 Cretaceous and Neogene reactivation and Dr M Keep UWA 3 213 795 266 458 inversion history of the Northern Carnarvon Basin and the role of basement highs in the distribution of Cretaceous and Neogene strain in the Carnarvon Basin and Browse Basin/Timor Sea.

M339 Using seismic anisotropy to characterize seal and Dr P Okoye Curtin 2 113 000 180 000 reservoir properties in the NW Shelf of WA Mr M Urosevic

M340 XMML – online data transfer for the exploration Dr S Cox CSIRO 1½ 285 000 380 000 and mining industry

M342 Development of a new seismic fracture mapping Dr B Evans Curtin 2 146 344 179 904 technique Mr M Luo

M344 Nutrient absorption capacity of neutralised acid Mr B McLoughlin Iluka/ 6 53 634 73 634 effluent and blends Mr D von Horn TiWest mths

M345 Automated measurement of phase behaviour in A/Prof T Edwards UWA 2 310 000 355 000 North West Shelf petroleum and natural gas Dr T Mann fluids using advanced microwave technology

M346 Upper crustal structure of the Laverton Tectonic A/Prof M Dentith UWA 1 215 000 260 000 Zone adjacent to major gold deposits from Dr B Goleby seismic reflection profiling

M347 Trace fossils and their application to high Dr F Burns UWA 2 183 558 213 693 resolution sequence stratigraphy and associated Dr A George cement distribution: Middle Jurassic to Lower Cretaceous Interval, North West Shelf

M348 Development of tantalum-silicon photovoltaic Dr J Livingstone UWA 3 23 000 53 000 devices Dr J Henry

M349 Dynamic testing of ground support elements Prof E Villaescusa WASM 2 230 000 271 965

M350 Selective herbivory by kangaroos in mined land Prof B Lamont Curtin 3½ 126 000 347 876

M354 The occupational health risk of Melioidosis in the Dr T Inglis PathCentre 2 160 300 181 300 mining industry Dr K Howard

M355 Mine seismicity and rockburst risk management – Prof Y Potvin ACG 3 720 600 1 095 600 Phase II Mr M Hudyma

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______Reports not yet Published as at 30 June 2002 ______

Report Project Project Title Author Status No. No. 200 M262 Post mining restoration of spinifex species in an K Dixon To be published on arid tropical zone at the Argyle diamond mine G Wells CD-ROM

210 M255 Investigations at the atomic level of interactions M Reyhani et al. To be published on between gibbsite and sodium oxalate in the Bayer CD-ROM process

211 M255A Investigations at the atomic level of interactions M Reyhani et al. To be published on between gibbsite and sodium oxalate in the Bayer CD-ROM process

212 M256 Influence of oxalate seed poisons on the A McKinnon To be published on crystallization and surface properties of sodium CD-ROM oxalate in the Bayer process

222 M281/ Characterisation and metallogenic significance of K F Cassidy et al Confidential AMIRA Archaean granitoids of the Yilgarn Craton

______Research Assistance ______

The function of the Institute is to encourage the development of the minerals and petroleum industries in Western Australia by fostering and promoting research in the exploration, development and production of minerals, hydrocarbons and fossil fuels.

MERIWA will accept applications throughout the year for financial assistance for such projects. These are scrutinised first by the Minerals Research Advisory Committee before its recommendations are considered by the Board.

Organisations with research proposals that have the potential to benefit the minerals or petroleum industries in this State may seek further information by contacting:

The Executive Officer, MERIWA 6th Floor, Mineral House 100 Plain Street EAST PERTH WA 6004

Telephone: (08) 9222 3397 Facsimile: (08) 9222 3727 Email address: [email protected] Website: www.mpr.wa.gov.au/meriwa

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______Financial Assistance from Industry ______

The following list is of companies and organisations which provided financial sponsorship in 2001/02 for projects in progress. The Board of Directors thanks these groups for their sponsorship and support.

MINERALS RESEARCH

Agip Australia Limited Kanowna Belle Gold Mines Limited AngloGold Australasia Limited Kalgoorlie Consolidated Gold Mines Pty Ltd Apache Energy Limited Kundana Gold Pty Limited Australian Geological Survey Organisation MBT (Australia) Pty Limited BHP Billiton Petroleum Pty Ltd New Hampton Goldfields Limited British Geological Survey, U.K. NSW Department of Mineral Resources Chevron Australia Pty Ltd Office of Minerals & Energy Resources, SA Concrete Offshore Structures Industry Placer Dome Asia Pacific Curtin Reservoir Geophysics Consortium Placer (Granny Smith) Pty Limited Department of Infrastructure, Energy & Resources, Tas. Santos Ltd Department of Mines & Energy, N.T. Snowden Technologies Pty Ltd Department Natural Resources & Environment, Vic. Sons of Gwalia Ltd Fractal Graphics Strata Control Systems Geological Survey of Western Australia TiWest Joint Venture Geotechnical Services Pty Ltd Vision Reservoir Management Technologies Homestake Gold of Australia Ltd Woodside Energy Ltd. Iluka Resources Limited WMC Resources Ltd

JOE LORD MEMORIAL SCHOLARSHIP

WA School of Mines
Outokumpu [Black Swan Nickel]
Normandy Mining Limited [now Newmont Australia]
Premier Coal [formerly Wesfarmers Coal Ltd]
Delta Gold Ltd [now AurionGold]

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______Audited Statements ______

Performance Indicators...... 28

Certification of Performance Indicators ...... 29

Opinion of the Auditor General on Performance Indicators ...... 30

Statement of Financial Performance for the Year Ended 30 June 2002...... 31

Statement of Financial Position for the Year Ended 30 June 2002 ...... 32

Statement of Cash Flows for the Year Ended 30 June 2002 ...... 33

Notes to the Financial Statements...... 34

Certification of Financial Statements ...... 42

Opinion of the Auditor General on Financial Statements ...... 43

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______Performance Indicators ______for the year ended 30 June 2002

Minerals Research Program Output 1 Outcome 1 "Finance and coordinate minerals research" "Promote all aspects of minerals research" Efficiency Indicator:

The key incentive provided by governments to The decreased cost is due to higher levels of industry encourage more research is to subsidise its cost. sponsorship, more applications received and slightly Government research funding schemes generally provide lower operating costs. this subsidy on a dollar-for-dollar basis, in which case 2001/02 2000/01 1999/00 1998/99 the amount of research undertaken is theoretically doubled. MERIWA’s policy has been to reduce the Cost per minerals research grant administered $5 276 $8 285 $6 107 $4 386 magnitude of the subsidy to nominally 35% of the cash cost, encouraging a higher level of participation from industry. Alternative Energy Research Program Outcome 2 The subsidy level must be such, however, to give MERIWA the authority to rigorously assess research "Promote all aspects of research and development programs and to establish “Conditions of Grant” that of alternative energy" facilitate coordination and accountability, and ensure that final reports can be published and widely Alternative energy research activities were transferred to distributed. The subsidy must be of a level to enable the Alternative Energy Development Board (AEDB) of promotion of research on regulatory issues such as the Office of Energy on 1 July, 1995. However, occupational health and safety, and minesite alternative energy funding still forms a part of the rehabilitation. MERIWA recurrent appropriation from government. Other than ratifying the recommendations of the AEDB In addition, research at PhD level is encouraged by the in respect to grant applications and making research awarding of two supplementary research scholarships grant claim payments approved by the AEDB, annually. MERIWA no longer has any input into the alternative energy research area. Details of activities will be Effectiveness Indicator reported separately by the Office of Energy.

Research was promoted by subsidy to the extent of the Alternative energy is an emerging technology that funds available. To maximise the effectiveness of this requires additional support to that which can be provided investment, sponsorship was maximised and the by the small local industry to allow effective research involvement of industry in each phase of the research and development to be undertaken in Western Australia. was promoted to focus the scope of the study on the No industry sponsorship is sought for alternative energy needs of industry and maximise technology transfer. By research grants. publishing reports, the research results were disseminated as widely as possible. Requests for grants for alternative energy research, development and demonstration are received by the The average level of industry sponsorship as a Office of Energy, and assessed and approved by the percentage of research value in 2001/2002 was 74% AEDB which, in turn, requests payment from its against a target of 65%. The effectiveness of component of the MERIWA grant funds. postgraduate doctoral research scholarships in promoting research will be gauged by the success of students in The AEDB has, as a major initiative, increased the ultimately achieving their PhDs and in presentations of promotion of alternative energy research, and the technical papers and posters at Australian and development and application of these technologies. international symposia. Twelve applications were processed and two scholarships awarded.

2001/2002 2000/2001 1999/2000 1998/1999 1997/1998 % Industry sponsorship achieved. 74% 69% 68% 82% 75% Target. 65% 65% 65% 65% 70% Research value 2 079 092 1 441 539 1 435 724 1 957 005 1 309 563

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______Performance Indicators ______(Continued) for the year ended 30 June 2002

Effectiveness Indicator Output 2

Promotion of research in the field of alternative energy "Finance and coordinate alternative energy is effected via provision of grants approved by AEDB. research and development"

Research organisations include universities (and Efficiency Indicator: affiliated Cooperative Research Centres or CRCs) and private industry groups. Applications received are assessed by an advisory committee within AEDB, The major component of administration of these including a thorough review of the applicants' facilities projects is borne by the AEDB within the Office of and resources. Energy. MERIWA merely receives the AEDB proportion of the budget appropriation and pays Four major broad areas of research work were invoices approved by the AEDB. undertaken and supported in 2001/2002 as follows. 2001-2002 2000-2001

Conclusions and outcomes will ultimately be measured Cost per research grant administered by the effectiveness of the research over time and for alternative energy research $27 $24 reported by the Office of Energy.

2001-2002 2000-2001

Solar Energy 19% $45 400 0% 0 Desalination 0% 0 0% 0 Control and Monitoring Systems 10% $23 290 36% $80 000 Remote Area Power Supply 19% $45 000 23% $49 970 Other 52% $120 493 41% $90 500

______Certification of Performance Indicators ______

We hereby certify that the performance indicators are based on proper records, are relevant and appropriate for assisting users to assess the Minerals and Energy Research Institute of Western Australia, and fairly represent the performance of the Minerals and Energy Research Institute of Western Australia for the financial year ended 30 June, 2002.

R E Butters C D Branch DIRECTOR AND CHAIRMAN, PRINCIPAL ACCOUNTING OFFICER BOARD OF DIRECTORS

21 August, 2002

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Opinion of the Auditor General on Performance Indicators

INTERIM REPORT

To the Parliament of Western Australia

MINERALS AND ENERGY RESEARCH INSTITUTE OF WESTERN AUSTRALIA Under the provisions of section 94 of the Financial Administration and Audit Act 1985, I advise that it will not be possible to complete the audit of the financial statements and performance indicators of the Minerals and Energy Research Institute of Western Australia for the year ended June 30, 2002 by November 30, 2002.

Further time is required to consider and resolve issues arising at a late stage in the audit.

It is anticipated that the opinions will be issued by December 18, 2002.

D D R PEARSON AUDITOR GENERAL

November 29, 2002

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Statement of Financial Performance for the year ended 30 June 2002

Note 2001/02 2000/01 Minerals Total Minerals Total Minerals Minerals & Energy & Energy $$$$

COST OF SERVICES

Expenses from ordinary activities Research Grants – MERIWA 1(d) (e) 553,756 775,580 341,146 718,766 Research Grants - Industry Sponsorship 1(d) (e) 1,544,834 1,544,834 930,750 930,750 Scholarships – MERIWA 1(d) (e) 40,000 40,000 38,154 37,221 Scholarships - Industry Scholarship 1(d) (e) 0 0 34,000 34,000 Superannuation contributions 7,879 7,879 8,580 8,580 Board of Director's remuneration 33,800 33,800 33,800 33,800 Advisory Committees attendance fees 3,081 3,081 3,792 3,792 Institute contract staff fees 97,388 97,388 107,246 107,246 Board and Advisory Committee's expenses 1,007 1,007 713 713 Printing and Stationery 3,785 3,785 7,976 7,976 Advertising 819 819 1,181 1,181 Capital User Charge 34,019 34,019 0 0 Other 40,342 72,770 20,548 70,548 Total cost of service 2,360,710 2,614,962 1,527,886 1,954,573

Revenues from ordinary activities Interest earnings on cashflow 81,465 81,465 109,801 109,801 Other 2,637 2,637 2,095 2,095 Revenues from Industry : Sponsorship 1(e) 1,544,834 1,544,834 930,750 930,750 Scholarship 1(e) 0 0 34,000 34,000 Total revenues from ordinary activities 1,628,936 1,628,936 1,076,646 1,076,646

Net Cost of Services 731,774 986,026 451,240 877,927

Revenues from government Output appropriation 612,000 875,000 611,000 874,000 Resources received free of charge 2 17,500 17,500 12,850 12,850 Total revenues from government 629,500 892,500 623,850 886,850

Change in net assets (102,274) (93,526) 172,610 8,923

Total changes in equity other than those resulting from transactions with WA State Government as (102,274) (93,526) 172,610 8,923 owners

The Statement of Financial Performance should be read in conjunction with the accompanying notes

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Statement of Financial Position as at 30 June 2002

Note 2001/02 2000/01 Minerals Total Minerals Total Minerals Minerals & Energy & Energy $$$$

CURRENT ASSETS

Cash assets 3, 6(a) 90,991 90,991 9,832 9,832 Short Term Investments 6(a) 1,222,066 1,630,457 1,203,918 1,733,650 Grants receivable - sponsorship 1(e) 915,263 915,263 855,650 855,650 Grants receivable - scholarship 1(e) 14,668 14,668 10,666 10,666 Receivables 4 22,278 22,278 0 0 Accrued Interest on Short Term Investments 7,710 7,710 8,633 8,633 Total current assets 2,272,976 2,681,367 2,088,699 2,618,431

NON-CURRENT ASSETS

Grants receivable - sponsorship 1(e) 650,600 650,600 292,000 292,000 Grants receivable - scholarship 1(e) 0 0 12,668 12,668 Total non-current assets 650,600 650,600 304,668 304,668

Total Assets 2,923,576 3,331,967 2,393,367 2,923,099

CURRENT LIABILITIES

Payables 5 0 0 12,499 12,499 Accrued Expenses 9,552 9,552 0 0 Grants approved not yet drawn 1(e) 1,506,386 1,731,106 1,484,117 1,702,920 Scholarships approved not yet drawn 1(e) 63,292 63,292 76,500 76,500 Total current liabilities 1,579,230 1,803,950 1,573,116 1,791,919

NON - CURRENT LIABILITIES

Grants approved not yet drawn 1(e) 1,075,697 1,191,587 459,352 711,225 Scholarships approved not yet drawn 1(e) 10,000 10,000 0 0 Total non-current liabilities 1,085,697 1,201,587 459,352 711,225

Total Liabilities 2,664,927 3,005,537 2,032,468 2,503,144

NET ASSETS 258,649 326,430 360,899 419,955

EQUITY

ACCUMULATED SURPLUS 1(d) 258,649 326,430 360,899 419,955

Total Equity 258,649 326,430 360,899 419,955

The Statement of Financial Position should be read in conjunction with the accompanying notes

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Statement of Cash Flows for the year ended 30 June 2002

2001/02 2000/01 INFLOWS INFLOWS (OUTFLOWS) (OUTFLOWS) Note $ $

CASH FLOWS FROM GOVERNMENT Output appropriation 875,000 874,000

Net cash provided by government 875,000 874,000

Utilised as follows :

CASH FLOWS FROM OPERATING ACTIVITIES

Payments

Payment for Research grants (1,855,074) (1,075,935) Payments to Employees (88,624) (107,246) Other Operating payments (138,871) (113,741) GST Payments on Purchases (183,880) (100,178) GST payments to taxation authority 0 (5,972) Receipts

Receipts from Sponsors 1,126,620 674,560 Receipts from Scholars 8,666 10,666 Interest received 82,388 112,767 Other operating receipts 2,637 2,095 GST receipts on sales 75,221 59,059 GST receipts from taxation authority 73,883 0

Net cash used in operating activities 6 (b) (897,034) (543,925)

Net Increase/(Decrease) in cash held (22,034) 330,075

Cash assets at the beginning of the financial year 1,743,482 1,413,407

Cash assets at the end of the financial year 6 (a) 1,721,448 1,743,482

The Statement of Cash Flows should be read in conjunction with the accompanying notes

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Notes to the Financial Statements for the year ended 30 June, 2002

1. Significant Accounting Policies

The following accounting policies have been adopted in the preparation of the financial statements. Unless otherwise stated these policies are consistent with those adopted in the previous year.

(a) General Statement

The financial statements constitute a general purpose financial report which has been prepared in accordance with Australian Accounting Standards and Urgent Issues Group (UIG) Consensus Views as applied by the Treasurer’s Instructions. Several of these are modified by the Treasurer’s Instructions to vary the application, disclosure, format and wording. The Financial Administration and Audit Act and the Treasurer’s Instructions are legislative provisions governing the preparation of financial statements and take precedence over Australian Accounting Standards and UIG Consensus Views. The modifications are intended to fulfil the requirements of general application to the public sector, together with the need for greater disclosure and also to satisfy accountability requirements.

If any such modification has a material or significant financial effect upon the reported results, details of that modification and where practicable the resulting financial effect are disclosed in individual notes to these financial statements.

The statements have been prepared on the accrual basis of accounting using the historical cost convention.

(b) Investments

Short term Investments are comprised of term deposits and bank bills invested in such securities as approved by the Treasurer.

(c) Superannuation

All Institute contract staff are non-contributory members of the West State Superannuation Scheme, an accumulation fund complying with the Commonwealth Government’s Superannuation Guarantee (Administration) Act 1992.

The liability for superannuation charges under the Government Employees Superannuation Act is extinguished by monthly payment of employer contributions to the Government Employees Superannuation Board.

(d) Reconciliation of Government Revenue and Expenditure

Government expenditure is divided between minerals research and energy research. Energy research activities were transferred to the Alternative Energy Development Board on 1 July 1995. However, until the legislation is in place, the coordination of energy research funding and financial control continues to be through MERIWA. The allocation of funds to each is shown in the following reconciliation.

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Notes to the Financial Statements for the year ended 30 June, 2002 (continued)

Minerals Energy Total $’000 $’000 $’000 Revenue Consolidated Fund-recurrent expenditure 612 263 875 Revenues from Services 84 - 84 Resources free of charge 18 - 18

Total revenue 714 263 977

Expenditure Research grants 554 222 776 Scholarships 40 - 40 Other Operating expenses 222 33 255

Total expenditure 816 255 1,071

Change in net assets from operations (102) 8 (94)

Equity Opening Balance 361 59 420

Equity Closing Balance 259 67 326

(e) Industry Sponsorship

All minerals research projects are funded partly by MERIWA grants and partly by Industry sponsorship. Sponsorship is allocated by a company (the sponsor) to a research project, which by agreement, is paid through MERIWA, who on behalf of the sponsor, maintain financial control over the project and progressively advance the grant funds to the research grantee. Sponsorship funds are not Government funds, and all funds received by MERIWA are held in trust until advanced to the research grantee.

The contribution made to research projects by Industry sponsorship in 2001/02 was as follows :

Government Funds Industry Total (MERIWA) Sponsorship Research Grants $’000 $’000 $’000

Mineral Research 554 1,545 2,099 Energy Research 222 - 222 Minerals Scholarships 40 - 40 ______Total 816 1,545 2,361

`Grants receivable - Sponsorship' represents sponsorship for projects which industry has agreed to advance to MERIWA for on-payment to the grantees. ‘Grants Receivable – Scholarship’ represents scholarship funds provided by Industry for the Joe Lord Memorial Scholarship. Current Assets represent funds due to be advanced in the 2002/03 financial year and Non Current Assets represent sponsorship due to be advanced after 2002/03.

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Notes to the Financial Statements for the year ended 30 June, 2002 (continued)

`Grants approved not yet drawn' represents funds which MERIWA and the sponsors have agreed to pay to research grantees. Current Liabilities represent payments due to be made to grantees in the 2002/03 financial year and Non Current Liabilities represent payments due to research grantees after 2002/03.

`Scholarships approved not yet drawn' represent the Institute's future commitment to fund approved scholarships. Current Liabilities include payments expected to be made during the 2002/03 financial year and Non Current Liabilities include payments expected to be made in later years.

(f) Output Appropriations

Output Appropriations are recognised as revenues in the period in which the Authority gains control of the appropriated funds. The Authority gains control of appropriated funds at the time those funds are deposited into the Authority’s bank account.

(g) Cash

For the purpose of the Statement of Cash Flows, cash includes cash on hand and in banks, net of outstanding bank overdrafts and investments in money market instruments.

(h) Resources Received Free of Charge

Resources received free of charge are recognised as revenues and expenses as appropriate at fair value.

(i) Capital User Charge

A capital user charge rate of 8% has been set by the Government for 2001/02 and represents the opportunity cost of capital invested in the net assets of the Authority used in the provision of outputs. The charge is calculated on the net assets, and payments are made to the Department of Treasury and Finance on a quarterly basis.

(j) Net Fair Values of Financial Assets and Liabilities

Net fair values of financial instruments are determined on the basis of : Monetary financial assets and liabilities not traded in an organised financial market, including cost basis carrying amounts of sponsorship receivable and research payments payable and accruals (which approximates net market value). 2. Resources received free of charge

Resources received free of charge have been determined on the basis of the following estimates provided by agencies. 2001/02 2000/01 $$ Office of the Auditor General Audit services 6,500 3,500 Department of Mineral and Petroleum Resources Accommodation and administrative services 11,000 9,350

17,500 12,850

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Notes to the Financial Statements for the year ended 30 June, 2002 (continued)

3. Cash Assets

2001/02 2000/01 $$

Cash at bank 90,791 9,632 Cash on hand 200 200

90,991 9,832

4. Receivables

GST Receivable 22,278 0

5. Payables

GST Payables 0 12,499

6. Notes to the Statement of Cash Flows

(a) Reconciliation of Cash

Cash at the end of the financial year as shown in the Statement of Cash Flows is reconciled to the related items in the Statement of Financial Position as follows :

2001/02 2000/01 $$

Cash at bank 90,791 9,632 Cash on hand 200 200 Investments - short term 1,630,457 1,733,650

Total 1,721,448 1,743,482

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Notes to the Financial Statements for the year ended 30 June, 2002 (continued)

(b) Reconciliation of Net Cost of Services to Net Cash Flows provided By/(Used In) Operating Activities

2001/02 2000/01 $$

Net cost of services (986,026) (877,927) Non-cash items Resources received free of charge 17,500 12,850 (Increase)/Decrease in assets Accrued Interest 923 2,966 Grants Receivable-Sponsorship (451,074) (256,190) Grants Receivable- Scholarships 8,666 (23,334) Increase/(Decrease) in liabilities Research Grants 508,548 615,163 Scholarships (3,208) 29,638 Accrued Expenses 9,552 0 Net GST receipts/(payments) (34,776) 0 Change in GST in receivables 32,861 (47,091)

Net Cash provided by/(used in) operating activities (897,034) (543,925)

7. Remuneration of members of the Accountable Authority and Senior Officers

Remuneration of Members of the Accountable Authority

The number of members of the Accountable Authority whose total of fees, salaries and other benefits received or due and receivable for the financial year, fall within the following bands are : 2001/02 2000/01

$0 - $10,000 3 3 $10,000 - $20,000 1 1

The total remuneration of the members of the $$ Accountable Authority is : 33,800 33,800

No amounts were paid or become payable to any superannuation fund for the financial year for any of the members of the Accountable authority.

No members of the Accountable Authority are members of the Superannuation and Family Benefits Act Scheme

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Notes to the Financial Statements for the year ended 30 June, 2002 (continued)

Remuneration of Senior Officers

The number of Senior Officers other than senior officers reported as members of the Accountable Authority whose total of fees, salaries, superannuation and other benefits received or due and receivable for the financial year, fall within the following bands are : 2001/02 2000/01

$10,001 - $20,000 0 1 $20,001 - $30,000 1 1

The total remuneration of senior officers is : 25,515 40,616

The superannuation included here represents the superannuation expense incurred by the Authority in respect of Senior Officers other than senior officers reported as members of the Accountable Authority.

No Senior Officers presently employed are members of the Superannuation and Family Benefits Act Scheme 8. Remuneration of Auditor

No fees are due and payable to the Office of the Auditor General for the 2001/02 financial year. However a notional fee for services provided free of charge is detailed at note 2. 9. Additional Financial Instruments Disclosures

Interest rate risk exposure

The Authority’s exposure to interest rate risk, repricing maturities and the effective interest rates on financial instruments are :

Weighted average Fixed Interest effective interest rate maturities Non-interest rate % 1 year or less Bearing Total $’000 $’000 $’000

30 June 2002

Assets Cash resources 4.78 1,630 91 1,721 Grants Receivable - Sponsorship - 1,566 1,566 Grants Receivable – Scholarships - 15 15 Receivables 22 22 Accrued Interest on Investments - 8 8

Total financial assets 1,630 1,702 3,332

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Notes to the Financial Statements for the year ended 30 June, 2002 (continued)

Liabilities Grants approved not yet drawn - 2,923 2,923 Scholarships approved not yet drawn - 73 73 Accrued Expenses - 10 10

Total financial liabilities - 3,006 3,006

Net financial assets (liabilities) 1,630 (1,304) 326

30 June 2001

Assets Cash resources 4.87 1,734 10 1,744 Grants Receivable - Sponsorship - 1,148 1,148 Grants Receivable – Scholarships - 23 23 Accrued Interest on Investments - 9 9

Total financial assets 1,734 1,190 2,924

Liabilities Grants approved not yet drawn - 2,414 2,414 Scholarships approved not yet drawn - 76 76

Total financial liabilities - 2,490 2,490

Net financial assets (liabilities) 1,734 (1,300) 434

10. Explanatory Statement

(a) Significant variations between actual revenues and expenditures for the financial year and revenues and expenditures for the immediately preceding financial year.

Details and reasons for significant variations between actual results with the corresponding items of the preceding year are detailed below. Significant variations are considered to be those + or - 10% and + or - $2,000

2002 2001 Variance $'000 $'000 $'000

Printing and stationery 4 8 (4) Capital User Charge 34 0 34 Interest earnings on cashflow 82 110 (28) Resources received free of charge 18 13 5

(i) Printing and stationery – the variance is due lower costs associated with producing publications.

(ii) Capital User Charge – the variance is due to the introduction of the user charge to reflect the cost of capital invested in the net assets of the Authority. The Department of Treasury and Finance determine the charge rate.

40 MMIIINNEERRAALLSS AANNDD EENNEERRGGYY RREESSEEAARRCCHH IIINNSSTTIIITTUUTTEE OOFF WWEESSTTEERRNN AAUUSSTTRRAALLIIIAA

Notes to the Financial Statements for the year ended 30 June, 2002 (continued)

(iii) Interest earnings on cashflow - the variance is due to commercial interest rates remaining lower than the previous year.

(iv) Resources received free of charge – the variance is due to increases on the notional fees for audit and accommodation services.

(b) Comparison of Estimates and Actual Results

Section 42 of the Financial Administration and Audit Act requires statutory authorities to prepare annual budget estimates. Treasurer’s Instruction 945 requires an explanation of significant variations between these estimates and actual results. Estimate Actual Variance 2001/02 2001/02 $’000 $’000 $’000 Cost of Services

Expenses from ordinary activities Research Grants (including Scholarships) 1,679 2,361 (682) Superannuation Contributions 10 8 2 Board of Director’s remuneration 34 34 - Staff Salaries 116 97 19 Printing and Stationery 10 4 6 Capital User Charge 34 34 - Other 37 77 (40) Total Expenses from ordinary activities 1,920 2,615 (695)

Revenues from ordinary activities

Interest earnings on cashflow 90 81 9 Other 2 3 (1) Revenues from Industry – Sponsorship 939 1,545 (606) Total Revenues from ordinary activities 1,031 1,629 (598)

Net Cost of Services 889 986 (97)

Revenues from Government

Consolidated Fund - recurrent expenditure 875 875 - Resources free of charge 14 18 (4) Total Revenues from Government 889 893 (4)

Change in Net Assets resulting from Operations - (93) (93)

Comments: Significant variations are considered to be those ± 10% and ± $2,000.

(i) Expenses from ordinary activities Research Grants (including Scholarships) was above the estimate because of increased research grant applications.

Staff Salaries was below the estimate due to lower than expected project co-ordination costs.

Printing and Stationery was lower than the estimate due to lower costs associated with producing publications than planned.

41 MINERALS AND ENERGY RESEARCH INSTITUTE OF WESTERN AUSTRALIA

Notes to the Financial Statements for the year ended 30 June, 2002 (continued)

Other expenses were above the estimate due to costs such as workers compensation premiums, consultants and audit fees and other administrative costs.

(ii) Revenues from ordinary activities Sponsorship was above the estimate due to a higher than anticipated number of applications and industry support. 11. Output Information

Treasurer's Instruction 1101(2)(viii) requires that statutory authorities provide segment information in the form of outputs.

MERIWA has two main activities, Minerals and Alternative Energy. These activities comprise two outputs - finance and coordinate minerals research, and finance and coordinate alternative energy research and development.

Financial information on the basis of the outputs has been consolidated into these two activities, which reflect the true and appropriate outputs of MERIWA.

It is considered that the requirement of Treasurer's Instruction 1101(2)(viii) is complied with due to the expenditure and revenue of these outputs being provided within the financial statements and supported by the accompanying notes. In the previous year's financial reporting, the statements and supporting notes have provided financial information on the basis of Minerals and Total Minerals and Energy. This has enabled comparative figures to be also reported. 12. Other

The Institute has no contingent liabilities, nor any related or affiliated bodies and there were no events occurring after reporting date.

______Certification of Financial Statements ______

The accompanying financial statements of the Minerals and Energy Research Institute of Western Australia have been prepared in compliance with the provisions of the Financial Administration and Audit Act, 1985 from proper accounts and records to present fairly the financial transactions for the year ending 30 June, 2002, and the financial position as at 30 June, 2002.

At the date of signing we are not aware of any circumstances which would render the particulars included in the financial statements misleading or inaccurate.

R E Butters C D Branch DIRECTOR AND CHAIRMAN, PRINCIPAL ACCOUNTING OFFICER BOARD OF DIRECTORS

21 August, 2002

42 MINERALS AND ENERGY RESEARCH INSTITUTE OF WESTERN AUSTRALIA

Opinion of the Auditor General on Financial Statements

INTERIM REPORT

To the Parliament of Western Australia

MINERALS AND ENERGY RESEARCH INSTITUTE OF WESTERN AUSTRALIA Under the provisions of section 94 of the Financial Administration and Audit Act 1985, I advise that it will not be possible to complete the audit of the financial statements and performance indicators of the Minerals and Energy Research Institute of Western Australia for the year ended June 30, 2002 by November 30, 2002.

Further time is required to consider and resolve issues arising at a late stage in the audit.

It is anticipated that the opinions will be issued by December 18, 2002.

D D R PEARSON AUDITOR GENERAL

November 29, 2002

43 MINERALS AND ENERGY RESEARCH INSTITUTE OF WESTERN AUSTRALIA Mineral House, 100 Plain Street, East Perth WA 6004 ISSN 1032-111X 17