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5th Meeting - Minutes EP Mineral & Energy Resources Community Development Taskforce Venue: Port Lincoln Hotel Commencement Time 10.05am Present: Rob Kerin Chair Geoff Dodd Coordinator Eleanor Scholz Chair, Wudinna District Council Diana Laube Presiding Member, EPNRM Board Peter Treloar Member for Flinders Bruce Green Mayor, City of Port Lincoln Dion Dorward CEO, RDA Whyalla and Eyre Peninsula [proxy for Jim Pollock] Daniel Woodyatt Director, Resource Land Access Strategy, DSD [proxy for Ted Tyne] Phil de Courcey CEO, RESA Invited Guests: Trevor Smith CEO, DC Tumby Bay Tim Scholz Principle Advisor, Stakeholder Engagement, Iron Road Limited Melissa Muller Principal Policy Advisor, Resource Land Access Strategy Branch, DSD Charles Moore Director, Resources and Strategy, DSD Vince Duffy Executive Director Energy Markets & Programs, DSD/Chair, Upper Spencer Gulf and Outback Taskforce Bob Ramsay Special Projects Manager, RDAWEP Aina Danis Executive Assistant RDAWEP/EPLGA [minute taker] Brad Flaherty Director, BNJ Consultants Apologies: Jason Kuchel, Ted Tyne, Matt Pinnegar, Jim Pollock, Mark Elford, Eddie Hughes, Tony Irvine, Don Hogben, Skana Gallery 1.0 MEETING OPENING: 1.1 Welcome/Apologies Chair Rob Kerin welcomed members and guests to the meeting and explained the procedure for the day’s business. 2.0 DISCLOSURE OF CONFLICTS OF INTEREST: None tabled. Bruce Green informed members that he is also on the Board of the LGA and therefore able to take back messages if required. 3.0 CONFIRMATION OF MINUTES: 3.1 Third meeting: 9 June 2015 Tim Scholz to be added to list of attendees. Recommendation 01/16: Moved: E Scholz Seconded: D Dorward That the amended minutes of the 4th meeting of the Eyre Peninsula Mineral and Energy Resources Community Development Taskforce held in Port Lincoln on Wednesday 25 November 2015, as supplied to members be adopted as a true and correct record of that meeting. CARRIED 30 March 2016 Page 1 5th Meeting - Minutes 4.0 BUSINESS ARISING FROM THE MINUTES Action Items – 25 November 2015 [refer agenda item 6.3]. 5.0 PRESENTATIONS 5.1 Dion Dorward, CEO Regional Development Australia Whyalla and Eyre Peninsula: Regional update. Dion Dorward spoke on the following items of interest: Whyalla, Arrium and contraction in the mining industry: - Upper Spencer Gulf Taskforce to address the loss of jobs, being in excess of 6,000 in the last 2 years. - Various activities to address loss of employment, businesses [contractors]. - Investment properties would rue this action. - Impact on families/banking transactions/businesses. - Arrium – unclear at this stage of the outcome of the future of the company. - Ongoing talks have been undertaken with government regarding assistance for Arrium. - The focus should be on reduction of input costs – power, water, payroll tax, etc and to drive demand for Australian steel and capability. - Investment in the rail from Tarcoola to Adelaide will employ people and create wealth. - High percentage of employment relies on the heavy industry/manufacturing/mining sectors. - Provision of mining services to the rest of the State – future projects are at risk due to the services no longer being available. - Planning projects for the future, such as energy, fuel, mining – essential to upgrade current infrastructure. - Infrastructure requirements and mining in South Australia - Infrastructure Australia released its 15 year plan, listing 3 major projects. The Gawler Craton rail was included however where will it connect to/which port was not specified. - Adelaide to Melbourne line upgrade – utilisation of Australian steel. - Increase mineral port capacity in South Australia – inclusion of the Port of Whyalla, Point Lowly and Cape Hardy are recommended. - A report completed by the Adelaide University [sponsored by the State Government, major stakeholders such as Santos, BP, etc] focuses on the sensitive eco systems within the Spencer Gulf and anything north of Arno Bay is a key area of concern. - The proposed Braemar Region Project has slurry being piped from Broken Hill and out into sea in the Spencer Gulf. Emerald Grain/Cape Hardy: - Emerald Grain recently announced their agreement to transport their grain through Cape Hardy if the development of the port proceeds. - Background of this initiative provided, along with the savings associated with establishing a port at Cape Hardy, including bulk handling and storage. - Impact on the roads in the region associated with the development of the port was highlighted. - Feasibility of an upgrade of the rail gauge and connection to Whyalla. - This initiative was discussed at a meeting with Infrastructure Australia regarding projects, during which it was raised that Cape Hardy should be connected to the National grid, which would entail a 2 year process, including planning, surveying, etc. - Having access to sufficient port facilities would assist Arrium and the Cultana Defence Training Facility. The Port of Whyalla is too narrow, unless barging is utilised however ships would be in demurrage and therefore the barging system would not be efficient or cost benefit. Dion Dorward highlighted that the closure of the Alinta power station has also affected employment/business in Whyalla, and Vince Duffy confirmed that 440 staff were laid off and an addition 160 in terms of supply chain numbers. Chair Rob Kerin added that because of the loss of the base load, businesses are now nervous, including Whyalla, eg Thomas International and the imminent increase in power costs will also be a major impact. Off-grid solutions were discussed, such as utilisation of the gas pipeline however these alternatives were not cost effective due to the need for costly conversions/infrastructure and storage capacity. Dion Dorward reported that the next steps to progressing the establishment of a port at Cape Hardy is to sell the business case study to/lobby the State and Federal Governments. 30 March 2016 Page 2 5th Meeting - Minutes Dion Dorward spoke on operating costs – barging costs/tug fleets in Whyalla compared to establishment of a port at Cape Hardy. Bruce Green stated that as the taskforce is under the umbrella of the EPLGA, the protocol for political lobbying would be for the EPLGA to undertake that role. Members resolved that the EPLGA be approached to write a letter to the Federal and State Governments, highlighting the importance of investing in and enabling infrastructure in the State. 5.2 Tim Scholz, Principle Advisor, Stakeholder Engagement, Iron Road Limited: Update on the Central Eyre Iron project Tim Scholz informed members that John Murray, Chairman/Managing Director, Emerald Grain sends his apologies and aims to attend in the next meeting of the taskforce. The application was lodged by Iron Road approximately a week ago. Submissions have been sorted, with an outcome of 52 positive and 49 negative responses registered. Examination of the negative submissions indicated that there are 2 activist groups that presented large submissions, which were mainly focussed on the impact of the impending infrastructure, rail corridor, etc. No new issues aside from public consultation phase were raised within the submissions. A comprehensive and sensitive Response Document has been produced and forwarded to the government. It is expected that a decision will be announced by September/October 2016. Perception of people directly impacted. The issue of compensation to the community is contentious at this stage however no offers have been put to the community and will not be until the project receives approval. Tim Scholz spoke on the following on behalf of Emerald Grain: The current cost per tonne to transport grain is $79 and it costs the handler $12.65 per tonne to export the grain to Indonesia. Transport costs in Western Australia are $66 and Victoria $72 per tonne. The establishment of a port at Cape Hardy will create a $10-$14 per tonne saving for farmers. The region’s farmers have continually incorporated up to date cropping methods and systems since the 1960s however the transport system is stuck in the same time zone, which reflects on the competiveness of Australian grain. Outcomes from the Select Committee’s final report: - The only conclusion that can be made is that the market parameters in the SA grain industry do not provide the basis for a vigorous and competitive market place for SA growers. - The Select Committee has received evidence from many industry participants that a lack of competition in the South Australian market is holding back the realisation of benefits that can be generated in deregulation. Their experience is that they do not receive an efficient or economic service Overview of Emerald Grain. Grains Industry Shared strategic vision by John Murray, CEO, Emerald Grain: - Both industry and government should be responsible for formulating a plan to improve farm productivity so that grain growers can achieve a better return at the farm gate. There is a need for a strategic, long term plan to ensure growers remain viable - otherwise we don’t have an agricultural industry in the region. Map of cropping area on Eyre Peninsula, indicating the significant geographical advantages of the establishment of a port at Cape Hardy. Currently discussions are being held between Emerald Grain and Iron Road regarding engineering work – stage 1 and stage 2 and construction of a partnership. Indication at this stage is 1 million tonnes per annum, which will be ramped up, and segregation taken into account as the company understands the need for the facility at Cape Hardy to take every type of grain. 30 March 2016 Page 3 5th Meeting - Minutes 5.3 Vince Duffy, Executive Director Energy Markets & Programs, DSD/Chair, Upper Spencer Gulf and Outback Taskforce: Impact on Eyre Peninsula of Alinta Power Stations closures and Energy Markets. Background information: Involved in energy policies since 1999. Alinta Taskforce – 5 sub-committees established – power/employees/upper spencer gulf/mining. Last train of coal towards the end of April 2016. Removal of stockpile is a major issue.
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