September Shire of Roebourne Local Planning Strategy Evidential Analysis Paper: (Major Industry Projects)

Shire of Roebourne – Economic Development Strategy Preliminary Paper

Version Control

Document History and Status Status Issued To Qty Date Reviewed Approved

Draft MP 1 23/4/13

Report Details Name: Author: Client: Name of doc: Doc version: Project number: P85029 SM Shire of Shire of Roebourne Electronic Draft 85029 MPD Roebourne – Local Planning P1263 SM Strategy 3103 PS

Disclaimer: If you are a party other than the Shire of Roebourne, MacroPlan Dimasi: owes you no duty (whether in contract or in tort or under statute or otherwise) with respect to or in connection with the attached report or any part thereof; and will have no liability to you for any loss or damage suffered or costs incurred by you or any other person arising out of or in connection with the provision to you of the attached report or any part thereof, however the loss or damage is caused, including, but not limited to, as a result of negligence.

If you are a party other than the Shire of Roebourne and you choose to rely upon the attached report or any part thereof, you do so entirely at your own risk.

The responsibility for determining the adequacy or otherwise of our terms of reference is that of the Shire of Roebourne.

The findings and recommendations in this report are given in good faith but, in the preparation of this report, we have relied upon and assumed, without independent verification, the accuracy, reliability and completeness of the information made available to us in the course of our work, and have not sought to establish the reliability of the information by reference to other evidence.

Any findings or recommendations contained within this report are based upon our reasonable professional judgement, based on the information which is available from the sources indicated. Should the project elements, external factors and assumptions change, then the findings and recommendations contained in this report may no longer be appropriate.

Accordingly, we do not confirm, underwrite or guarantee that the outcomes referred to in this report will be achieved.

Shire of Roebourne Local Planning Strategy Evidential Analysis Paper: (Major Industry Projects)

Executive summary

MacroPlan Dimasi was engaged by the Shire of Roebourne to provide an evidential analysis report on major industrial projects that are currently under construction or proposed in the Shire. In order to achieve this, MacroPlan Dimasi undertook the following tasks;

 Reviewed the economic condition of the Shire of Roebourne with reference to past and future trends;  Identified the main growth drivers in the Shire;  Identified mining and other significant infrastructure projects currently under construction;  Assessed the potential impact of major industry projects currently under construction;  Identified proposed or planned industry projects;  Assessed the potential impact of proposed or planned industry projects;  Assessed the demand for and the likeliness of educational facilities, health campuses, and community infrastructure.

In addition, to the above deliverables of the project brief, MacroPlan Dimasi has prepared the following;

 Overview of the Shire of Roebourne Economy o Past and future trends o Major industry projects o Population o Employment o Outlook and vision o Implications for the rest of WA  Infrastructure services o Water o Waste o Power supply o Telecommunications  Major investment overview o Mining operations o Mining capital investments o Other major capital investments

Shire of Roebourne Local Planning Strategy Evidential Analysis Paper: (Major Industry Projects)

Contents

1 Introduction ...... 9 1.1 Report Scope ...... 9 1.2 Methodology ...... 9 1.3 Key Data ...... 9 1.4 Disclaimer ...... 10 2 Shire of Roebourne Overview ...... 11 2.1 Geographical location ...... 11 2.2 Population ...... 11 2.3 Economy ...... 11 2.4 Infrastructure ...... 11 3 Utility infrastructure projects ...... 13 3.1 Overview ...... 13 3.2 Power ...... 13 3.2.1 Future power supply projects ...... 14 3.3 Water ...... 15 3.3.1 Future water supply projects ...... 15 3.4 Waste water ...... 16 3.4.1 Future waste water projects ...... 17 3.5 Solid waste ...... 17 3.5.1 Future solid waste projects ...... 17 3.6 Telecommunications ...... 17 3.7 Transport ...... 17 3.7.1 Future transport infrastructure projects ...... 18 3.8 Transport infrastructure map ...... 19 3.9 Utilities infrastructure map ...... 20 4 Community Infrastructure & Facilities Projects ...... 21 4.1 Health ...... 21 4.2 Education ...... 21 4.3 Community Facilities ...... 22 4.4 Community Infrastructure & Facilities Map ...... 23 5 Minerals & Resources ...... 24 5.1 Minerals & Resources Map ...... 30 5.2 Mining Projects Map ...... 31 6 Diversification Projects ...... 32 7 Conclusion ...... 35

Appendices

Appendix 1: West project Appendix 2: iron ore in the Pilbara Appendix 3: Gorgon Appendix 4 Prospective Resources Projects, Pilbara

7 Shire of Roebourne Local Planning Strategy Evidential Analysis Paper: (Major Industry Projects)

Reporting acronyms and abbreviations

ABS Australian Bureau of Statistics

BHPB BHP Billiton

DOP Department of Planning

FIFO Fly-in, fly-out

GFC Global financial crisis m million

PICC Pilbara Industry Community Council

RDA Regional Development

RTIO Rio Tinto Iron Ore

Settlement Refers to urban settlements in the study area i.e. Damiper, Wickham and Point Samsom

SIA Strategic industrial area

SOR Shire of Roebourne i.e. administrative and governance body

TAFE Technical and Further Education

The Pilbara The Pilbara region i.e. geographical region where the study area is located

The Shire Shire of Roebourne i.e. the geographical study area

Town centre “CBD” activity centres within the Shire

Township refers to the activity centres within the Shire i.e. Karratha and Roebourne

TWA Temporary worker accommodation

WAPC Western Australian Planning Commission

8 Shire of Roebourne Local Planning Strategy Evidential Analysis Paper: (Major Industry Projects)

1 Introduction

MacroPlan Dimasi was engaged by the Shire of Roebourne to undertake research and analysis on the potential impact of major industry projects currently under construction and those planned in the Shire of Roebourne. The information provided in this report will provide an economic assessment on the Shire of Roebourne with emphasis placed on major mining and infrastructure projects and the likely outcome on key economic drivers such as population and employment growth, tourism and mining.

1.1 Report Scope

This report comprises the following key sections:

 Mining Project and Employment Analysis – estimates and projections of future residential and FIFO demand, direct and indirect employment associated with advanced and less advanced mining mineral processing and transportation projects in the Shire of Roebourne over the next five years.  Population Forecasts for the Shire of Roebourne – projections of the future residential (indigenous and non‐indigenous) and service population of the Shire.  Hard Infrastructure Requirements and Priorities – review of identified hard infrastructure priorities in the Shire as well as outlining their current funding status.  Conclusions – SWOT analysis on the impact of major industry projects currently under construction or planned for the Shire of Roebourne.

1.2 Methodology

MacroPlan Dimasi, have adopted the following methodology in order to analyse the economic outlook of the Shire of Roebourne with particular emphasis on major industry projects:

1. Review relevant documentation and previous studies undertaken in order to gain context and understanding (outlined in Bibliography). 2. Review the Shire of Roebourne economy and identify the drivers and effects the resources sector has on the local economy. 3. Review the investment in the area along with mining and resource projects to estimate the potential workforce required in order to ensure their delivery. 4. Analyse the current FIFO and service worker population so as to estimate an overall resident population and determine the demand requirements of the Shire.

It should be noted that all years quoted in this report are calendar years.

1.3 Key Data

MacroPlan Dimasi recognises that considerable information, research and analysis has been completed relating to a range of issues affecting the Pilbara region. In this report, MacroPlan Dimasi has drawn upon and utilised the following data and information sets:  Department of Mines and Petroleum Prospect project data;  ABS Census of Population and Housing (1996,2001 and 2006);  Bureau of Resources and Energy Economics (BREE) – formerly Australian Bureau of Agriculture Resource Economics and Sciences (ABARES);  Various ABS Catalogues;  BITRE Regional Airports Data, 2000 to 2011; 9 Shire of Roebourne Local Planning Strategy Evidential Analysis Paper: (Major Industry Projects)

 PICC Planning for Resources Growth in the Pilbara: Revised Employment and Population Projections to 2020, Heuris Pty Ltd, April 2010;  Unpublished and Draft WAPC and State Government reports and data;  WA Chamber of Minerals and Energy information.

1.4 Disclaimer

This study has been prepared by MacroPlan Dimasi Pty Ltd and is intended for the purpose described in this report and not for any other purpose. The contents of this report should not be reproduced without the express permission of MacroPlan Dimasi Pty Ltd. The forecasts made in this report are dependent on many variables and in the event of changes in economic circumstances need to be reviewed.

10 Shire of Roebourne Local Planning Strategy Evidential Analysis Paper: (Major Industry Projects)

2 Shire of Roebourne Overview

2.1 Geographical location

The Shire of Roebourne located within the rural Pilbara region of has a geographical area of 15,882 square kilometres, set some 1,566 kilometres from Perth. Karratha is the main township within the Shire of Roebourne and is the one of the twin cities of the Pilbara, along with Port Hedland. As well as Karratha, the Shire of Roebourne also comprises the townships of Dampier, Wickham, Roebourne, Point Samson and Cossack.

Regional access to Karratha is via the North West Coastal Highway, which is the main carriageway in the region, or via Karratha Airport which is Western Australia’s busiest regional airport for passenger movements. The Shire services the accommodation and administrative needs of the major resource projects in the region, as well as providing for the shopping needs of local and broader-area residents, workers and businesses.

Table 1. Shire of Roebourne settlement hierarchy Function Priorities 2011 Census Footprint (approx. Population area (ha)) City Karratha 16,476 5,000 Major Town Wickham 1,651 4,800 Village Point Samson 298 Town Dampier 1,265 1,000 Town Roebourne 1, 410 Village Cossack Shire of Roebourne 23,927 1,527,800 Sources: WAPC, Pilbara Planning and Infrastructure Framework, January 2012; ABS Census, 2011

2.2 Population

The permanent population residing in the Shire of Roebourne is approximately 23,000 people with an estimated FIFO population in 2011/12 of around 10,000 workers. There are a number of future population scenarios all of which are highly dependent on the level of future industry projects and infrastructure expenditure. This will be explored within the following report as well as the population projections assessment of the Local Planning Strategy.

2.3 Economy

According to the 2011 Census, the shire has a total labour force of 12,235 people. With more than 250 million tonnes of exported minerals per annum, the Shire of Roebourne has had a booming economy for over a decade. Although new construction for minerals and energy projects slowing it is possible that other industries will emerge as mining construction decreases. The regional airport in Karratha is one of the busiest in Australia and provides opportunities for a future tourism industry as well as assisting growth in other areas. A number of community infrastructure projects occurring have led to anticipations of populations of 50,000 for both Karratha and Port Hedland within the next 20 - 30 years.

2.4 Infrastructure

11 Shire of Roebourne Local Planning Strategy Evidential Analysis Paper: (Major Industry Projects)

There are a number of infrastructure projects that have been proposed for the Shire of Roebourne which includes utilities, industrial infrastructure, and community facilities. This report will go through each of existing infrastructures of the area as well as the proposed projects and various scenarios that could be put in place as part of the local planning strategy.

12 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) 3 Utility infrastructure projects

3.1 Overview

The State Government has committed to the goal of providing better living standards for the Pilbara region, therefore are undertaking a strategy of delivering infrastructure that will achieve this outcome for residents. The purpose of this investment is initially to ‘catch up’ the lack of government investment of the past and to make the Pilbara Cities a place where people want to live. This initial investment has already been committed and therefore it will happen regardless of the mining companies future investment decisions. Because the drivers behind these other investments are quite different to the drivers affecting mining capital investment, they are addressed separately.

The first stage of the State’s plan, occurring between 2012 and 2020 is a catch-up phase whereby putting the necessary infrastructure in place to support the growth of the town. In particular the following list of priority infrastructure needs to be considered:

 Power  Scheme water  Wastewater  Ports  Roads  Airport  Health  Education  Security

Funding options for utility infrastructure in the future may include:

 Increased State Government funding, including continued Royalties for Regions funding beyond 2013;  Collaborative funding by the State Government and Commonwealth (through Infrastructure Australia) to facilitate investment in the Pilbara through public-private partnership (PPP) funding;  Commonwealth Government investment including: Defence Posture Review, National Broadband Network and Infrastructure Australia; and/or  Renewable energy opportunities in the Pilbara – the Australian Centre for Renewable Energy and the Commonwealth’s Department of Resources, Energy & Tourism have been examining opportunities for solar development in the Pilbara that could support Federal investment.  Substantial investment required into North West Interconnected System until the end of 2016 and again in 2023-25. Substantial upgrades required to water supplies and waste water treatment plants and infrastructure, including the waste water reuse scheme.  New $207M City Centre hospital expected to be completed in 2017.

3.2 Power

Major settlements in the Shire of Roebourne are supplied with electricity by Horizon Power through the North West Interconnected System (NWIS). The NWIS covers thousands of square kilometres extending 400 kilometres east to west and 350 kilometres north to south.

13 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) Within the Shire of Roebourne, the NWIS system serves Karratha, Roebourne and Point Samson through the Horizon Power network and Dampier and Wickham through the (RTIO-owned) network. It also serves Pannawonica, Paraburdoo and Tom Price through the Pilbara Iron (Rio Tinto) network and Port Hedland and South Hedland through the Horizon Power Network.

The transmission and distribution network provides supply to the customer network. At present the transmission system is a mix of public and private ownership. Horizon Power is required to carry its power across systems owned by others with varying transmission capacities.

Figure 1: Power supplied and demand – Pilbara (assuming no private sector investment)

Source: Pilbara Investment Prospectus, RDA

3.2.1 Future power supply projects

Investment in extension of the transmission system and negotiation of a unified system management arrangement between network owners may facilitate access to significant generation capacity currently not connected to the NWIS (e.g. Citic Pacific’s new 450MW power station at Cape Preston).

Horizon Power presently has the following infrastructure projects either proposed, planned or underway for the NWIS network:

 Pilbara Underground Power Project to convert current overhead distribution networks to an underground network in residential and light industrial areas of Karratha, Roebourne, South Hedland, Wedgefield and Onslow – funded with $100 million funding through Royalties for Regions;  Refurbishment of Gap Ridge substation which is already partially funded;

14 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects)  Transmission upgrades of $150 million, including the transmission line between Karratha and Port Hedland by up-rating the 132kv line between and Karratha to 220kv. A further $115 million will be required post 2012/13 for additional construction works; and  A new power generation source will be required in 2013-14 to meet forecast load requirements. The source is currently deferred by installing 20MW generation at Karratha power station (at a cost of $40 million) and extension of a 60MW contract with Alinta for a period of three years.

The estimated capital expenditure on the NWIS indicates a significant investment is required through to 2017-18 and then another smaller round of investment from 2022-23 through to 2025-26.

Figure 2: Estimated power capital expenditure

Source: Horizon Power 2011

3.3 Water

In September 2011, the State Government secured an agreement with Rio Tinto to surrender its annual entitlement of water from the Millstream aquifer to develop its own alternative water supply from the Bungaroo Valley. The Millstream aquifer is capable of providing 10,000 million litres of water per year to the West Pilbara water supply scheme.

The Scheme’s supply is sourced currently from two sources that are entirely climate-dependent: 1. Harding River Dam (surface water) – primary source. 2. Millstream aquifer (groundwater) – secondary source.

3.3.1 Future water supply projects

Karratha The Water Corporation is currently working with Rio Tinto to develop and integrate a third water source for the WPWSS, utilising groundwater from the Bungaroo borefield. Under this proposal, Rio Tinto is to build the borefield and transfer system to the WPWSS. Water from this source will be connected at ‘Summit’ tanks located near the proposed Bungaroo pipeline juncture.

15 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) The distribution network also requires upgrades and the Water Corporation needs to upgrade the WPWSS to accommodate the extra flows and transfer them to demand areas. This has been funded by the Water Corporation to a conservative estimate of $68 million.

The State Government has endorsed Rio Tinto’s development of the Bungaroo supply project, which will also enable Rio Tinto to provide 10GL/yr to the scheme to supply their coastal operations. Any unused portion may be made available to supply WPWSS demands.

Under this arrangement Rio Tinto has surrendered their 5.4GL/yr entitlement to the Millstream aquifer that was previously included in the State Agreement. The Department of Water is investigating the potential to expand the Bungaroo borefield to provide an additional five to 10GL/yr.

The development of the Bungaroo supply is a short-term solution and while it will reduce demand pressure on the WPWSS, it will not ensure future security of supply.

The new WPWSS will combine the sources of Bungaroo, Millstream and Harding Dam to provide a reliable supply of 20GL/yr. Of this it is expected that 2–3 GL/yr will be available in the short-term (to meet non-Rio Tinto demands).

Even with this improvement, the Department of Water advises a new source could be required by: 1. 2014-16 under a high demand growth scenario; 2. 2018-19 under a medium demand growth scenario; and 3. Post 2021 under a low demand growth scenario.

Note that all three sources are still climate-dependent and that regular recharge of the Millstream aquifer and Harding Dam or improvements in water-use efficiency could push these timeframes further into the future.

The Water Corporation has plans for a 6GL seawater desalination plant on the Burrup Peninsula to supply into the WPWSS. These plans have been deferred given the introduction of Bungaroo borefield, which will address short-term water supply. Over the next several years significant commitment of funding to ensure the longer term security of water supply to WPWSS will be required.

It should be noted that the Citic Pacific project at Cape Preston (located 40 kilometres west of Karratha), has built a 51GL/yr seawater desalination plant to service its magnetite processing operations.

The Water Corporation is also investigating the feasibility of a non-potable supply to augment the WPWSS. There are opportunities for this to support new industrial developments such as the proposed Anketell Strategic Industrial Area (SIA) and associated resource projects. Investment in delivery infrastructure for non-potable supply, and the design of industry infrastructure to use potable water could potentially create opportunities for development of new supply sources.

3.4 Waste water

There are three waste water treatment plants (WWTPs) in Karratha which are currently planned and/or committed for upgrades at a cost of $68 million:

1. Karratha WWTP No.1 (east area of town) is planned to be upgraded to be the main WWTP in Karratha capable of treating 10 ML/day; 2. Karratha WWTP No.2 (west area of town) will receive a minor expansion to cope with extra flows (treating 0.9 ML/day). WWTP No.2 needs further upgrading to cope with increased flows at an estimated cost of $30 million; and

16 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) 3. Karratha WWTP No.3 is the light industrial area plant (east of town) and will remain at current capacity and separate from plants No.1 and No.2.

3.4.1 Future waste water projects

Estimated costs to upgrade WWTP No.1 to 8000 kL/d are approximately $122 m. This includes $51 m for facility upgrade, $40 m for wastewater conveyance (upgrade to 11 000 kL/d) and $31 m for treated wastewater management. Depending on the magnitude of growth in Karratha, a new wastewater treatment plant may be required in the future.

3.5 Solid waste

The Shire produces approximately 13,500 tonnes of waste per annum. At present, only 1% is recovered for recycling, and the bulk is sent to landfill. Therefore, there is significant potential to divert wastes away from landfill. The Shire of Roebourne has experienced considerable growth in recent years and reports an increase of over 50% in waste volumes over the last five years. Karratha’s main disposal facility, the Seven Mile Waste Disposal Facility west of Karratha, permits the disposal of general, effluent, hazardous and green waste, and includes a recycling facility.

3.5.1 Future solid waste projects

The Pilbara local governments, through the Pilbara Regional Council, completed a Regional Waste Management Plan in 2008 to: 1. Improve the management and use of landfills; 2. Extend the life of existing landfills; and 3. If possible, replace the smaller landfills with transfer stations equipped to meet the needs of the people and the environment.

3.6 Telecommunications

Karratha’s telecommunications exchange and tower is located in the town centre on Balmoral Road, south of Morse Court. A communications reserve is also located on View Road, south of Millstream Road. This site accommodates the Telstra satellite station. There are a number of mobile phone towers located across Karratha. Both Telstra and Optus have recently installed, or are planning to establish additional towers to improve coverage and address reliability issues.

Projects to improve the existing mobile phone coverage, and access to the National Broadband Network have been identified as part of the Pilbara Cities initiative. Construction of the NBN has commenced in Karratha and Roebourne and fibre service to the majority of the settlements in the Shire is scheduled for completion by September 2015.

3.7 Transport

The North West Coastal State Highway runs through the middle of the Shire of Roebourne. Due to the majority of inputs into the area being via road it carries many heavy vehicles. The output of the region are often handled by rail or shipped from one of the 3 ports within the Pilbara, Dampier, Port Hedland and Cape Lambert. Karratha airport is one of the busiest regional airports in Australia with current connections to major airports in the Eastern States. Expansion of the airport to make it an international holiday destination would create great tourism opportunities.

17 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) Figure 3: Pilbara ports (existing and proposed)

Source: Dampier Port Authority, Development Plan, 2010

3.7.1 Future transport infrastructure projects

Roads Future upgrades to roads in the region include the construction of a second Karratha airport access road, increasing Burrup Peninsula Road to four lanes, and a direct link between Karratha, Wickham and Mount Anketell has also been planned but feasibility is yet to be finalised.

Rail A new West Pilbara railway has been planned as part of the West Pilbara Iron Ore Project which will increase the tonnage moved to the new Anketell Port.

Ports The new Anketell Port, located 30km east of Karratha will be designed to complement the existing facilities at Dampier and Port Hedland. The expected export capacity is more than 350 million tonnes per annum and includes an industrial area of 1400ha. A dedicated infrastructure corridor will provide access for transport and services.

Two New Iron projects are under planning within the Shire being Iron Ore Holdings Buckland Project seeking to export from Cape Preston and Forge Resources seeking to export from Balla Balla near Whim Creek.

Airport The Karratha Airport provides a vital air link to the Pilbara region with some 800,000 passengers passing through the terminal building each year. The airport carpark underwent a $6.9-million expansion and redevelopment in 2011 to improve services for all patrons. The new car park now offers over 1,000 sealed parking bays within a five minute walk of the terminal. The Airport Masterplan will provide for anticipated growth over the next 20 years. Karratha airport upgrades currently stand at $24.3 million in the short term with an additional proposed terminal upgrade costing approximately $60 million.

18 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects)

3.8 Transport infrastructure map

Source: WAPC, Pilbara Planning & Infrastructure Framework, January 2012

19 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects)

3.9 Utilities infrastructure map

Source: WAPC, Pilbara Planning & Infrastructure Framework, January 2012

20 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) 4 Community Infrastructure & Facilities Projects

4.1 Health

Included in the Shire of Roebourne are Nickol Bay Hospital and Roebourne District Hospital. Nickol Bay hospital is a 28 bed facility (as the table below illustrates) and is the larger of the two with Roebourne Hospital only providing 8 overnight beds.

Table 2. Shire of Roebourne health services Health Facility Medical Staff Nursing Staff Other Total Nickol Bay 9.9 43 41.9 94.8 Hospital Roebourne 0 15.5 11.2 26.7 District Hospital Total 9.9 58.5 53.1 121.5 Source: WAPC, 2009

A new hospital to be located in Karratha was confirmed in May 2012. The new hospital, costing a total of $207 million ($57 million of which came from the Royalties for Regions scheme), is the single largest expenditure on health infrastructure in rural WA to date. The hospital will be located in the city centre and is expected to be completed in 2017.

4.2 Education

There are a number of educational facilities within the Shire of Roebourne. The table below shows the existing and potential supply of educational facilities located in the Shire.

Table 3. Existing and potential educational facilities provision Current Potential Location Primary Secondary TAFE Primary Secondary TAFE School School College School School College Cossack 0 0 0 0 0 0 Dampier 1 0 0 1 0 0 Karratha 5 2 1 6 2 1 Point 0 0 0 0 0 0 Samson Roebourne 1 1 1 1 1 1 Wickham 1 0 0 1 0 0 Total 8 3 2 9 3 2 Source: Dept of Education & Training, 2010

2013 will see the opening of the new Baynton West Primary School. Until the Shire’s population increases, there are no proposed education campuses in the area. The future strategy of the Shire should include at what population additional educational services will be required including the provision of tertiary education and research services.

21 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects)

4.3 Community Facilities

The Shire is a major economic centre for the Pilbara, and the major services centre, underpinned by a continued strength in the resources sector, but also through broader and local planning and revitalisation initiatives proposed for the region.

Some of these revitalisation projects are included in the following:

 The Karratha Leisure Complex, which will be a state-of-the-art facility incorporating an aquatic centre, sports playing fields, indoor and outdoor courts, a fitness centre and other facilities. This complex is being built in conjunction with the second stage of the Karratha Senior High School project.  The Pam Buchanan Family Centre was recently completed, and provides a one-stop venue for the provision of family and child related services, such as a childcare centre, family counselling and other specialist health providers.  The building for the Frank Butler Community Centre provides for a variety of needs within the community, such as social functions, sporting club use, community group meetings and indoor sports such as dancing, martial arts, and fitness training.  Infrastructure works within the Karratha City Centre will deliver a well-integrated city centre that meets the needs of residents and visitors both now and in the future; as well as developing new retail, commercial and residential opportunities. These works include the extension of Sharpe Avenue to the north and south to Dampier Road to create a tree-lined city main street, and the realignment and improvement of other town centre roads.  The masterplan for the Dampier Highway Streetscape Upgrade will transform the western gateway to Karratha, including the inclusion of public art and beautification of six roundabouts.  The Karratha 2020 vision discusses a number or community revitalisation projects and precinct upgrades, such as the Sharpe Ave perspective, Bulgarra development and Karratha Town Centre Enhancement projects.

Karratha serves as the main retail centre and Centro Karratha is the largest shopping centre in the Pilbara region. It is anchored by a Kmart discount department store, and Woolworths and Coles supermarkets, together with a broad provision of specialty traders.

The table below shows the division of community facilities in the Shire of Roebourne.

Table 4. Existing facilities Indoor sporting Lit Swimming Boat Facilities complex ovals pool Harbour ramp Dampier 0 2 0 1 3 Karratha 1 3 50m 0 2 Point Samson 0 0 0 1 2 Roebourne 0 1 25m 0 0 Wickham 0 1 25m 1 1 Source: WAPC, 2009

The future of the Shire of Roebourne’s community facilities relies heavily on the future population scenarios of the Shire. The Community Facilities Plan report attached to the Shire of Roebourne Local Planning Strategy looks at alternative population scenarios and assesses appropriate provision rates.

22 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects)

4.4 Community Infrastructure & Facilities Map

Source: WAPC, Pilbara Planning & Infrastructure Framework, January 2012 23 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) 5 Minerals & Resources

The figure below shows the concentration of prospective major resource projects within WA.

Table 5. Advanced research projects in WA

Source: Australian Bureau of Agriculture and Resource Economics, April 2011

There is a significant pipeline of mining, mineral processing and transportation projects proposed and planned for the Pilbara region over the next five years. These projects:  are at different stages of the planning and approvals process;  are in different locations in within the Pilbara; and  target and exploit different resources and commodities.

A more detailed list of prospective projects that might influence the Shire of Roebourne is attached as Appendix 1.

There are three major resource companies operating in the Shire (Rio Tinto, Woodside Energy Ltd and Citic Pacific Mining). Each company is currently operating or rolling out mining and energy extraction infrastructure investments worth an estimated $69 billion (Table 9). The most significant include the Woodside operated North West Shelf Venture, Woodside’s Pluto project, Rio Tinto’s expansion of Dampier Port, Cape Lambert Port and CP Mining plans for Cape Preston. A total of more than 22,000 construction jobs and 4,000 permanent jobs are to be created from these projects.

24 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) Table 1: West Pilbara - Selected Committed Resource Infrastructure Projects Capital Construction Operational Project Investment Workforce Workforce Devil Creek Development Project Apache Energy/ Santo gas $896m 200 20 processing Citic Pacific Mining Sino Iron Ore Project US$5.2b 4500 800 Chevron Gorgon Joint Venture offshore gas extraction $43b 3500 600 Woodside Pluto offshore gas extraction $12b 4000 300 Woodside joint venture gas project $7.9b - - Total $69b 12,200+ 1,720+ (Data source: Prospect)

In addition to this, some $16.8 billion worth of investment is under consideration or at pre-feasibility stage. It is noteworthy from the table above that the total operational workforce represents only around 14% of the construction workforce currently in the Shire.

Other new prospects that may arise and become viable over time and be either located in or serviced from the Pilbara and these would re-ignite the construction sector. These include Canning Basin gas projects and the Balmoral South and Balla Balla magnetite projects.

Cost of both construction and operations, together with an uncertain or subdued outlook for commodity prices are now substantial factors in determining the viability of new projects. Escalating construction costs are likely to be a major issue.

Anketell Port The Anketell Point multi-user Port facility is currently still in prospect, but facing delays. The proposed port, located 30km north-east of Karratha and 6km north-west of Wickham would include the operation of a deepwater port with iron ore stockpiling, transfer and ship loading facilities. Initially, the port would have a capacity of 115 Mtpa. Development would occur over a 20 year period, with an ultimate capacity of around 350 Mtpa of iron ore. Stage 1 of the project would employ 950 in its construction phase for a 6-month period and employ 150 in the operational phase1.

The construction of Anketell Port primarily depends on the API West Pilbara project. The Project is a substantial iron ore export operation proposed for the Pilbara region, south of Pannawonica, shown on the map below. Stage 1 of the Project is based initially on pisolite iron ore deposits located 30 km to 85 km south west of Pannawonica. There is potential for growth in subsequent stages based on the prospective and extensive tenement portfolio in the west Pilbara, as well as tenements in the east Pilbara. The port project has some uncertainty, due to ongoing negotiations over financing.

However, it is possible that the State Government will seek an alternative route to development of stage 1 of the project, with a view to operations by the end of 2015.

1 Advice: Department of State Development 25 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) West Pilbara iron ore project

The forecast growth of the area including housing, land and infrastructure requirements is principally dependent on the size, scale timing and positioning of these projects. They create employment opportunities and increase the resident population. This leads to a growth in demand for housing and the development of the region for support facilities.

BHP Billiton An indication that investment is likely to continue in the short to medium term is the proposed expansion of export capacity of iron ore from a number of major companies. BHP Billiton has approved $7.5 billion to lift its iron ore capacity from 155 million tonnes a year to 220 million tonnes by 2014. Furthermore BHP Billiton has plans to move to 350 million tonnes by 2020 through the Port Hedland outer harbour which is likely to cost an additional $20 billion and beyond that to 450 million tonnes per year.

Rio Tinto Rio Tinto is planning to spend $20 billion to expand its operations from 225 million tonnes per year to an annual capacity of 333 million tonnes a year with plans to get to 433 million tonnes per year. It is currently expanding its Cape Lambert port capacity

26 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) Fortescue Metals Group plans to boost annual production fivefold to 225 million tonnes per year over the next five years. This will mean the eventual plans of Australia’s big three will add up to more than the total current seaborne iron ore trade of about 1 billion tonnes per year. is also confident of expansion of its South West Quay berth export terminal which will be built by the end of 2015, allowing it to increase exports from 15 million tonnes per annum to 22 million tonnes per annum.

Figure 4: New capital expenditure (volume terms)

Source: ABS, December 2012

The graph above shows that new capital expenditure has been increasing almost exponentially since the global financial crisis and reached record levels in December 2012 with this trend expected to continue. The following bar graph shows mining capital expenditure over time with estimate 5 for mining in 2012-13 at $105,096 million. This is 13.9% higher than the corresponding estimate for 2011-12. This clearly supports the notion of ongoing investment in the Pilbara and as such the ongoing demand for housing and accommodation product due to the ongoing expansion and introduction of new projects in the State’s North-West.

Figure 5: Mining capital expenditure

Source: ABS, Reserve Bank of Australia, December 2012

This continuing expansion will ensure that speculation in the area will occur for a number of years to come and this notion is supported by the future growth forecast of 129 per cent by 2025 in Australia's trade. This

27 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) figure is almost double the global rate, placing it fourth overall in Asia, according to HSBC Trade Connections.

HSBC Trade Connections, a new quarterly global trade forecast tool, predicts that Australia will become the second fastest growing export market in the world, equal to China. The tool, which assessed macroeconomic trends and market influences on trade, found that Australia will perform particularly well in the next five years when trade growth will hit 7.7 per cent annually, some four times world growth of 2 per cent annually2.

There are therefore good prospects that ongoing investment in the Pilbara region will see the current super cycle last longer than previously expected.

Figure 6: Major iron ore expansion projects (BHP Billiton, FMG) to 2022 900 800 Projects under 700 consideration 600 500 Projects Committed 400 Projects under 300 construction 200 Existing Capacity

100 WA IronWA Oreproduction profile (mtpa) 0 2012 2014 2016 2018 2020 2022

Source: MacroPlan Dimasi, 2013

2 HSBC, Global Connections Report, Feb 2013 28 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) Table 6. Mining projects Project Name Company Location Status Start Capital Construction Operational Exp. ($ Workforce Workforce billion) Gorgon LNG Chevron/ Shell/ Exxon Barrow Island Under 2015 43 5,500 300 Construction Wheatstone LNG Chevron/ Apache/ Carnarvon Basin Committed 2016 30 6,500 300 KUFPEC/ Tokyo Electric Sino Iron CITIC Pacific Mining Cape Preston Under 2012 5.4 4,000 500 Construction NWS North Rankin Woodside Energy/ BHP Carnarvon Basin Under 2013 5.3 700 B Billiton/ BP/ Chevron/ Construction Shell Cape Lambert Port Rio Tinto/Robe River Karratha Under 2015 3.7 300 300 & Rail Expansion Construction Brunello / Julimar Apache / Kupec Dampier Feasibility 2016 3 Study Hope Downs 4 Rio Tinto Newman Under 2013 1.6 Construction Hardey Aquilla Resources Pannawonica Feasibility 2016 1.6 Study Macedon LNG BHP Billiton/ Apache Onslow Under 2013 1.55 300 Energy Construction NWS LNG Woodside Energy/ BHP Carnarvon Basin Under 2012 1.5 Woodside Billiton/ BP/ Chevron/ Construction Shell Reindeer Gas Field/ Apache Energy/ Santos Carnarvon Basin Under 2012 1.08 200 20 Devil Creek Gas Construction Burrup Ammonium Burrup Holdings / Yarra Burrup Peninsula Under 2013 0.6 600 65 Nitrate plant Int. Construction Van Gogh LNG Apache/ Inpex Carnarvon Basin Committed 2013 0.554 80 Pilbara Project Flinders Mines Tom Price Feasibility 2014 0.488 Study Balnaves LNG Apache Energy/ Santos Dampier Awaiting 2014 0.459 Approval Spar LNG Apache Energy/ Santos Onslow Committed 2013 0.124 Nullagine Gold Millenium Minerals Nullagine Committed 2012 0.072 Project Pluto (Train 2 & 3) Woodside Energy Carnarvon Basin Feasibility tbc Completed Scarborough Gas Exxon Mobil/ BHP Billiton Onslow Feasibility Study Kintyre Cameco/ Mitsubishi Telfar Feasibility 600 250 Study Manyingee Paladin Resources 400km ESE of Port Feasibility study and EIS on 0.12 Hedland hold Marillana Brockman Resources Ltd 100km NW of Proposed NA Newman, WA Maroochydore Aditya Birla Pilbara region Feasibility 0.2 Minerals(50%)/Murchison 100km SE of Nifty study United NL(50%) mine, WA underway Balmoral Southern Australasian Resources 30 km from Cape Proposed 2.6 - magnetite Preston and 80km SW of Dampier, WA Brockman 4 Hamersley Iron Pilbara, WA Under 1.52 Construction Hope Downs (50%) & Rio Tinto (50%) Operating 1 1,000 300 Munni Munni PGM Helix Resources/ Lonmin Karratha New project, feasibility 0.071 study underway Yannarie Solar Straits Salt Pty Ltd 80km south of Proposed NA Onslow, WA Sherlock Bay Australasian Resources Near Karratha, WA Bankable feasibility study 0.035 Ltd completed. Dampier Nitrogen Incitec Pivot Burrup Peninsula Feasibility tbc 400 65 Study Total 149.573 28,100 3,480 Source: Town of Port Hedland (Planning, Land, Housing and Community Infrastructure), WAPC

29 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects)

5.1 Minerals & Resources Map

Source: WAPC, Pilbara Planning & Infrastructure Framework, January 2012

30 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects)

5.2 Mining Projects Map

Figure 7: Major resource projects in the Pilbara

Source: Government o f Western Australia, 2012 31 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) 6 Diversification Projects

A common theme amongst the numerous planning and economic studies for the Pilbara3 and for the Shire of Roebourne is the need to diversify the local economy if the labour force and therefore the population is to expand.

Other base and driver industries have been suggested. For example, a report by Worley Parsons on the land requirements for the establishment of an algae industry in the Pilbara4 notes the Pilbara has a number of characteristics that provide the potential for the future development of sustainable, commercial scale algae industries. The sunny weather conditions, the vast tracts of non-arable land, matched with the proximity of both sea water and world scale sources of concentrated CO2, provide the ideal inputs for high volume algae production. The Pilbara also houses a number of major industries that are significant consumers of diesel, and these industries provide a natural market for regionally produced algae based biofuels.

The report includes a preliminary assessment of potential locations and identifies a site in the Shire of Roebourne south of Dampier as being amongst the most viable, although there are constraints and risks to address.

The report notes, however, that while the Pilbara has many attractive attributes for the development of algae industries, it also has a high cost operating environment. There are a number of other areas around the world that offer similar potential to the Pilbara in terms of attractive attributes for algae production, but which currently offer cheaper operating environments. Such areas include parts of the Middle East, Southern USA, and North Africa. Global competition from these (and other) areas could materially impact the likelihood of the Pilbara becoming a future site of major algae industry developments. Therefore the establishment of this industry could be regarded as possible, but by no means certain in the Shire.

Similar factors working against industry establishment are likely to be relevant in many of the other non- mining sector diversification industries that arise for consideration.

The labour resources required to operate a full scale 5,000 ha facility would see the employment of in the order of 200 people. Although a high degree of automation is possible, the efficiency of biological processes such as algae production is highly dependent on operator input and expertise. As such, many of these people would require a biological background, and/or a strong understanding of algae production.

A further spin-off could be the building of a research institute, using the technical input and technical workforce requirements for algae production facilities as a basis for such an institute. However, this could prove difficult. The effectiveness of research institutes of this type is determined by both the long term commitment of major funding of infrastructure and its ability to attract high calibre researchers. This is long term commitment in a highly competitive and high risk environment. Are more likely path is the establishment of negotiated and managed relationships with existing and internationally recognized

3 For example: Development Australia Pilbara: • Pilbara Report 2012 • Pilbara Regional Plan 2012 – 2017 Pilbara Development Commission / Pilbara Cities Office: • Pilbara Cities Vision document • Karratha City of the North Plan • Pilbara Planning and Infrastructure Framework • Pilbara Regional Council Plan for the future • Pilbara Regional Economy 4 WorleyParsons, Pilbara Algae Industry Study, Pilbara Cities Office, June 2012 32 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) research organisations. This would result in a modest number of researchers on site. (As an aside a local example of the difficulty of generating anything more than modest local employment from specialist research and education bodies can be found in the Margaret River Centre of Wine Excellence and Margaret River Education Campus, which despite being located in a region of high quality wine production and in one of the most attractive places to live now has a high proportion of its research and education activities and staff located in Perth.)

Aurora Algae have a pilot plant underway south of Dampier. Recently Aurora Algae announced this pilot will be discontinued and the company is now considering Geraldton as an alternative site.

Aurora Algae Pilot Plant

Source: Aurora Algae

Other potential non-mining export sector projects arise for consideration. Those currently identified by Regional Development Australia Pilbara5 include:

Prospective employment (operations) Project: Skilled professional Skilled technical and semi-skilled Bio-fuels Project 5 - 10 20 - 30 Hi-Tech Greenhouse 5 - 10 20 - 30 Aquaculture fish farm 4 10 Fish processing factory 2 10 - 20 Source: RDA

Other projects will arise for consideration; for example a pilot high intensity horticulture facility in South Australia using seawater desalinated on site shows promise and may represent a technology which could be utilised in the Shire at some stage in the future.

Some or all of these, or variation of them have some prospects of implementation and will be important for the economic diversification of the Shire. However, it is important to retain a sense of scale for each of these projects: even a very large project (e.g. the algae farm) in full production provides only a modest

5 Regional Development Australia Pilbara, Pilbara Report 2012 33 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) contribution to employment growth. Assuming all employment multipliers are applied locally and with minimal FIFO employment the full scale algae farm or 200 workers might account for a population increase in the Shire of only around 500 people. A large number of these projects are therefore required to achieve significant economic diversification of the export driver sections of the economy away from its current resources base and to significantly increase the population to the levels anticipated in the Pilbara Cities program.

Direct and Indirect Effects

Expenditure or local employment leads to further activity in the economy. The extent to which extra activity circulates and stays in the economy depends upon a number of factors including fly-in fly-out and the size and capacity of the local economy. The following employment multipliers have been calculated by Compelling Economics and are specific for the Pilbara. The multipliers include the industrial and consumption effect of direct employment in the Pilbara Regional Economy.

Employment multipliers in the Pilbara Pilbara industry sector Employment multipliers using Employment multipliers updated to 2006/07 national input/output tables 2007/08 national input/output tables Agriculture, Forestry and Fishing 1.27 1.27 Mining 1.94 1.97 Manufacturing 2.17 2.04 Electricity, gas, water & waste services 1.5 1.46 Construction 1.73 1.78 Wholesale trade 1.55 1.52 Retail trade 1.16 1.14 Accommodation & food 1.19 1.18 Transport, postal & warehousing 1.5 1.45 Information media & 1.49 1.45 telecommunications Financial & insurance 1.47 1.46 Rental, hiring & real estate services 1.68 1.66 Professional, scientific and technical 1.42 1.38 services Admin & support services 1.42 1.42 Public admin & safety services 1.34 1.32 Education & training 1.22 1.2 Health care & social assistance 1.18 1.18 Arts and recreation services 1.26 1.22 Other services 1.22 1.2 Source: Pilbara Development Commission, Pilbara Regional Economy Version 2, March 2012

Additional jobs in manufacturing have the strongest impact on employment in the Pilbara. With a multiplier of 2.04, a single manufacturing job leads to 1.04 new jobs in the Pilbara regional economy. A high proportion of manufacturing in the Pilbara, both current and prospective activity, is connected to the resources industry, and much current manufacturing activity is likely to be connected to the construction phase of resource projects and will be vulnerable to fluctuations in construction activity.

34 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) 7 Conclusion

The major projects in the Shire and in the Pilbara generally provide a very strong economic underpinning.

The prospects are for strong growth in operations expansion in for iron ore and other minerals in the Pilbara and wider region. However, only a few of these new projects are in the Shire. Opportunities will therefore be in value chain goods and services to both construction and operational phases. Karratha is already a centre for this, with a god number of small and medium enterprises marketing into the Resource sector value chain.

Similarly LNG generally shows high growth prospects. However, the extent to which this will flow on to specifically to the Shire of Roebourne is uncertain. There are prospects for on-shore support for future processing of Browse Basin gas on-shore at Dampier for example. However, the high cost of building on- shore gas plants and the recent cost blowouts of projects such as Pluto is making FLNG a more attractive option. Regardless on-shore processing is unlikely to lead to very large increases in operational labour demand.

With a solid and expanding LNG industry the opportunities for businesses in the Shire are likely to be to use the existing skill base in LNG and offshore servicing to expand to other areas. However, it is noteworthy that the current preferred site for a common user facility that might be a focus for the expansion of businesses servicing the off-shore industry is at Port Hedland.

There is likely to be quite rapid increase in the level of knowledge of FLNG technology and capturing this in the Shire, possibly via some specialised research projects, to the extent it is possible will provide a knowledge base that can be applied elsewhere.

35 Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) Appendix 1: West Pilbara iron ore project

The Project is a substantial iron ore export operation proposed for the Pilbara region of Western Australia (Figure 1). API is currently developing Stage 1 of the Project, which is based initially on pisolite iron ore deposits located 30 km to 85 km south west of Pannawonica. There is potential for considerable growth in subsequent stages based on the prospective and extensive tenement portfolio in the west Pilbara, as well as tenements in the east Pilbara.

API completed the Pre-Feasibility Study for Stage 1 of the Project in May 2008 with the following primary project outcomes:

 Iron ore mining and export at a rate of 25 million tonnes per annum;  Simultaneous mining of multiple pisolite deposits located on the western region of the Hamersley Ranges (Figure 2);  A heavy haul railway from the mine area to a port location at Cape Preston (approximately 160km);  Iron ore stockpiles, processing, blending and ship loading facilities at the port location;  Capital investment in the order of $A4.0 billion.

API completed the Feasibility Study (FS) for Stage 1 of the West Pilbara Iron Ore Project (the “Project”) in June 2010. The FS reports the technical and financial viability of the proposed 30Mtpa Stage 1 development.

Aquila Resources has put its $7.4 billion West Pilbara iron ore project on hold at least through June 2013 due to funding difficulties.

Aquila and its partners AMCI, a mining investment firm, and South Korean steel giant Posco, effectively froze the project last September, when iron ore prices hit a three-year low. They had failed to agree on a budget for the year to June 2013 and sent the dispute into arbitration.6 The West Pilbara Iron Ore project has won state environmental approval for its proposed Anketell Port, but still needs rail and port construction approvals, key to its plans for exporting 30 million tonnes a year of ore.

The West Australian state government has said it will not approve construction of Anketell Port until it is certain the project's backers have the funds to build a mine, a 282 km rail line and the multi-user port, which will depend on what has become an increasingly volatile iron ore market. Recent financing talks have failed to secure the appropriate funds.

6 http://www.smh.com.au/business/mining-and-resources/aquila-puts-74b-iron-ore-project-on-ice- 20130204-2dthi.html#ixzz2MvQQ7CCa (SMH 3 Feb 2013)

Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects)

Appendix 2: Rio Tinto iron ore in the Pilbara

Rio Tinto iron ore operations in the Pilbara have a current annual capacity of 237 million tonnes, with advanced plans to increase capacity to 290 million tonnes by 2013, on a pathway to 360 million tonnes by 2015. With a network of 14 mines, three shipping terminals and the largest privately owned heavy freight rail network in Australia, its Pilbara operations make up a major part of the company’s iron ore activities globally. Operations began in 1966 and are well positioned to meet the growing needs of the world's iron and steel industry.

Strongly underpinning this goal is the roll out of Autonomous Haulage Systems (AHS) across its Pilbara mines. The next operation to venture into driverless trucks will be Rio Tinto’s latest development B2/Nammuldi, which will see the world’s largest roll out of autonomous fleet.

In the Pilbara, Rio Tinto wholly own Hamersley Iron's eight mines and also operate the (50:50 joint venture between Rio Tinto and Hancock Prospecting Pty Limited), the (Rio Tinto: 60 per cent) and the Eastern Range mine (Rio Tinto: 54 per cent). Iron ore operations in the Pilbara also include a 53 per cent interest in Robe River Iron Associates' three mines: Mesa J, Mesa A/Warramboo and West Angelas.

Port facilities are located at Dampier and Cape Lambert.

Pastoral stations: Rio Tinto holds six pastoral stations in the Pilbara - Karratha, Hamersley, Rocklea, Juna, Yalleen and Yarraloola, and self-manage five.

Rio Tinto has recently won approval from the state to expand its Nammuldi mine and build a 130 megawatt power station, a $3 billion iron ore project that is part of its plans to increase annual capacity to 360 million tonnes by 2015.

Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects) Appendix 3: Gorgon

The Gorgon gas project involves the development of the Greater Gorgon gas fields, subsea gas-gathering infrastructure, and a liquefied natural gas (LNG) plant on Barrow Island. The project also includes a domestic gas component. It is currently under construction and once completed, will become Australia's fourth LNG export development. Whilst this project is not within the Shire of Roebourne, considerable logistics, supply tasks are occurring via Dampier and subsequently some FIFO via Karratha airport which may continue.

LNG sales agreements have been reached between the joint venturers and customers in China, India, Japan and South Korea.

Chevron Australia has executed Sale and Purchase Agreements (SPAs) with Osaka Gas (1.375Mtpa for 25 years and 1.25 percent equity in the Gorgon Project), Tokyo Gas (1.1Mtpa for 25 years and 1 percent equity), Chubu Electric Power (1.44Mtpa for 25 years and 0.417 percent equity in the Gorgon Project) and GS Caltex of South Korea (0.5Mtpa for 20 years from Gorgon and Chevron system gas). Chevron Australia also has Heads of Agreements with Korea Gas Corporation (KOGAS) (1.5Mtpa for 15 years); Nippon Oil Corporation (0.3 Mtpa for 15 years) and Kyushu Electric (0.3 Mtpa for 15 years).

Shell has entered into long-term LNG sale and purchase agreements with PetroChina International Company Limited and BP Singapore Pte. Limited and also has secured capacity at LNG receiving terminals including the terminals at Energia Costa Azul in Baja California, Mexico and Hazira in Gujarat, India.

An Australian subsidiary of ExxonMobil has signed long-term sales and purchase agreements with Petronet LNG Limited of India and PetroChina International Company Limited for the supply of LNG from the Gorgon Project. The agreement with Petronet LNG is for the supply of approximately 1.5 Mtpa of LNG over a 20- year term while the agreement with PetroChina is for the supply of approximately 2.25 Mtpa over a 20-year term. Together, these two sales and purchase agreements commit the ExxonMobil subsidiary's share of LNG from the 15 Mtpa Gorgon LNG Project.

Under the provisions of the Barrow Island Act (2003), the joint venturers are required to reserve 2000 petajoules of gas for delivery into the domestic market. The Gorgon Joint Venture announced plans to establish a domestic gas project, including plans for progressive expansion to enable delivery of 300 terajoules of gas per day into the domestic transmission system. Chevron has indicated that deliveries of Gorgon domestic gas will commence around the time of start-up of the third LNG train.

Shire of Roebourne Local Planning Strategy Evidential Analysis Report 6: (Major Industry Projects)

Appendix 4:

Prospective Resources Projects, Pilbara

Indicative

ted Estimated Construction Operating Estimated Capacity Cost New Resource Employment Employment

Start Up Stage Unit Estimate

Publicly Publicly Capacity Estimate Estimate

Feasibility Feasibility

Completed Commit

Project Company State Location Type Announced $m Anketell Point port Fortescue Metals Group / MCC / Aquila WA Pilbara New project n/a y 350000 ktpa Iron Ore 2500-5000

Balla Balla project (phase I) Forge Resources WA 90 km E of Karratha New project n/a y 6000 kt Magnetite 1000

Balla Balla project (phase II) Forge Resources / Todd Capital WA 90 km E of Karratha New project n/a y 4000 kt Magnetite 500-1000

Balla Balla slurry pipe and port Forge Resources WA Port Hedland New project n/a y 6000 ktpa Iron Ore 310 infrastructure Balmoral South magnetite project (stage 1) Australasian Resources WA 100 km NE of Onslow New project 2017 y 12000 kt Magnetite 3300

Balmoral South magnetite project (stage 2) Australasian Resources WA 100 km NE of Onslow Expansion n/a y 12000 kt Magnetite 2500-5000

Balnaves Development Project Apache Energy / KUFPEC WA 180 km NW of new project 2014 y 30 kbpd Oil 429 Dampier Buckland Project Iron Ore Holdings WA Pilbara New project 2015 y 8000 kt Hematite 500-1000

Burrup ammonium nitrate plant Orica / Yarra / Apache WA Burrup Peninsula New project Ammonium 2015 y 330 kt 775 600 65 nitrate Cape Lambert port and rail expansion Rio Tinto / Hancock Prospecting WA 40 km N of Karratha Expansion 2013 y 60000 ktpa Iron Ore 5166

Cape Lambert port expansion Rio Tinto / Hancock Prospecting WA 40 km N of Karratha Expansion 2015 y 70000 ktpa Iron Ore 3100

Coniston Oil Field Project Apache Energy / Inpex WA 50 km N of Exmouth expansion 2014 y 22 kbpd Oil 526

Dampier–Bunbury gas pipeline (DBNGP) DBP WA Dampier to Bunbury Expansion n/a y 100 PJ pa Gas 800 expansion (stage 5C) Equus Hess WA 300 km W of new project 2018+ y n/a Gas/LNG 1500 - 2500 Dampier Fletcher-Finucane Santos / KUFPEC / Nippon Oil / Tap Oil WA Carnarvon Basin new project 2013 y 15 kbpd Oil 490

Greater Western Flank - Phase 1 Woodside Energy / BHP Billiton / BP / WA Carnarvon Basin expansion 2016 y n/a Gas 2300 Chevron / Shell / Japan Australia LNG Hamersley Iron Brockman 4 project (Stage Rio Tinto WA Pilbara Expansion 2012 y 18000 kt Hematite 1070 2) Hardey Aquila Resources WA 180 km SW of New project 2016 y 10000 kt Hematite 1500-2500 Pannawonica Iron Valley Project Iron Ore Holdings WA Pilbara New project n/a y 15000 kt Hematite 250 - 500

Julimar Development Project Apache / KUFPEC WA 180 km NW of new project 2016 y 2.1 tcf Gas 1200 Dampier Koodaideri Project Rio Tinto WA Pilbara New project 2016 y 70000 kt Hematite 7000

Marandoo Rio Tinto WA Pilbara Expansion 2014 y n/a Hematite 1070 700

Nammuldi expansion Rio Tinto WA Pilbara Expansion 2014 y 26000 kt Hematite 2140

NWS North Rankin B Woodside Energy / BHP Billiton / BP / WA 150 km NW of expansion 2013 y 967 PJ pa Gas 5000 Chevron / Shell / Japan Australia LNG Dampier Sherlock Bay Australasian Resources / Metals Australia WA 100 km E of Karratha New project na y 9 kt Nickel 0-250

Sino Iron Project CITIC Pacific Mining WA Cape Preston New project 2013 y 24000 kt Magnetite 8400 4500 800

Spar 2 Apache Energy / Santos WA 120 km N of Onslow new project 2015 y 18 PJ pa Gas 117

West Pilbara Aquila Resources / AMCI WA Pilbara New project n/a y 30000 kt Hematite 7400

Western Turner Syncline II Rio Tinto WA 30 km W of Tom Expansion 2012 y 9000 kt Hematite Price