Government of Western Australia Department of Mines, Industry Regulation and Safety WESTERN AUSTRALIAN MINERAL AND PETROLEUM STATISTICS DIGEST Disclaimer Information provided in this digest is made available without charge, as a public service, in good faith. The information provided is derived from sources believed to be reliable and accurate at the time of publication. However, use of the information in the digest is at your own risk. The digest is provided solely on the basis that users will be responsible for making their own assessment of the information provided therein and users are advised to verify all representations, statements and information for decisions that concern the conduct of business that involves monetary or operational consequences. 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Cover photo: Copyright Woodside Energy Ltd Government of Western Australia Department of Mines, Industry Regulation and Safety CONTENTS FOREWORD __________________________________________________________________________________ 3 OVERVIEW ___________________________________________________________________________________ 4 AVAILABILITY OF DETAILED RESOURCE DATA _______________________________________________ 8 1 INDUSTRY ACTIVITY _______________________________________________________________________ 9 1.1 MINERAL TITLES ________________________________________________________________________ 9 1.2 PETROLEUM TITLES ____________________________________________________________________ 9 1.3 EXPLORATION ___________________________________________________________________________ 10 1.4 INVESTMENT ACTIVITY _________________________________________________________________ 12 1.5 PRINCIPAL MINING PROJECTS __________________________________________________________ 14 1.6 EMPLOYMENT ___________________________________________________________________________ 14 1.7 ROYALTIES ______________________________________________________________________________ 17 2 COMMODITY REVIEW _____________________________________________________________________ 19 2.1 IRON ORE ________________________________________________________________________________ 19 2.2 PETROLEUM ____________________________________________________________________________ 22 2.3 GOLD ____________________________________________________________________________________ 29 2.4 ALUMINA AND BAUXITE _________________________________________________________________ 32 2.5 NICKEL __________________________________________________________________________________ 34 2.6 BASE METALS ___________________________________________________________________________ 36 2.7 MINERAL SANDS ________________________________________________________________________ 37 2.8 LITHIUM _________________________________________________________________________________ 38 2.9 OTHER __________________________________________________________________________________ 40 1 WESTERN AUSTRALIAN MINERAL AND PETROLEUM STATISTICS DIGEST 2017–18 2 WESTERN AUSTRALIAN MINERAL AND PETROLEUM STATISTICS DIGEST 2017–18 FOREWORD During 2017–18, global commodity markets generally showed improvement. About half of the world’s countries experienced an increase in economic growth, creating a period of synchronised global upturn with most Western Australian producers benefitting from the recovery in prices seen throughout 2017 and into the start of 2018. However, in the latter half of the period, growing tensions between the US and China and talk of a potential trade war became a major headline, creating some investor uncertainty. Other factors to influence global commodity markets this period included: • the moderation of China’s economic growth, particularly in property and infrastructure, which has flow on effects on demand for raw materials such as iron ore • a sustained lift in crude oil prices following OPEC’s coordinated supply constraints • a series of events e.g. the stalling of the typical Chinese seasonal commodity restock, the announcement of US trade tariffs and unresolved disputes between the US and Russia • a persistent lack of project investment which saw minimal mine supply growth in some commodities. While these factors created uncertainty in financial markets, WA’s commodity driven export market remained steady with the exception of the LNG sector which grew substantially over the period. We also saw the emergence of WA as a potential supplier of the battery related materials needed to support substantial green energy initiatives around the world. Stemming from this, it is pleasing to see a new wave of investment in lithium and related sectors which will help sustain our minerals and petroleum sector into the future. David Smith Director General Department of Mines, Industry Regulation and Safety 3 WESTERN AUSTRALIAN MINERAL AND PETROLEUM STATISTICS DIGEST 2017–18 OVERVIEW For much of 2017–18 some optimism returned to the WA’s nickel sector has struggled in recent years, with global commodity market, with the volatility of previous the value of the sector declining year-on-year since years easing across a number of commodities. 2010–11. However, in 2017–18, fortunes turned with However, political tensions played a part in the latter the value of the sector increasing 26 per cent from half of the year with the threat of a trade war between $2.1 billion in 2016–17 to $2.6 billion in 2017–18. the US and China affecting the strength of some markets in mid-2018. The remaining minerals sales values comprised: Locally, the Australian dollar was up slightly from an • Base metal sales of $1.6 billion (up 16 per cent) average of 75 US cents in 2016–17 to 77 US cents • Coal sales of $332 million (down 1.9 per cent) in 2017–18. Generally, global commodity prices held up well with the financial year average price of most • Cobalt sales of $514 million (up 115 per cent) commodities increasing on the gains made in 2016–17. • Mineral sands sales of $358 million Iron ore was an exception to this trend. (down 29 per cent) In 2017–18, Western Australia’s (WA’s) mineral and • Salt sales of $301 million (up 3 per cent) petroleum industry reported sales of just less than • Spodumene sales of $1.6 billion (up 167 per cent). $115 billion. The bulk of the $10 billion increase on 2016–17 was the result of increased LNG volumes and Petroleum sector highlights improvement in the petroleum sector more broadly. The petroleum sector, which comprises crude oil, condensate, LNG, natural gas and LPG, accounted Mineral sector highlights for 23 per cent of the total value of WA’s mineral and Mineral commodities still dominate the State’s petroleum sales in 2017–18. This made it the second resources sector, accounting for 77 per cent, or most valuable sector after iron ore. $88 billion, of total sales value. Iron ore was by far the most valuable commodity, accounting for 70 per cent The sector was valued at $26.6 billion in 2017–18, an of mineral sales and 54 per cent of overall sales. increase of 39 per cent from $19.2 billion in 2016–17. Iron ore recorded sales valued at $61.7 billion in LNG remains WA’s most valuable petroleum product, 2017–18, down slightly (3 per cent) on the previous accounting for almost 17 per cent of all mineral year. Record sales volumes of almost 826 million and petroleum sales in 2017–18. The value of LNG tonnes were not enough to offset the lower prices sales rose more than $6 billion from $12.7 billion in received by WA producers. 2016–17 to $19.1 billion in 2017–18. Gold sales volumes increased for the third year in a The volume of LNG produced in WA increased row to reach a record 212 tonnes (7.5 million ounces) 45 per cent during the five years to 2016–17 and in 2017–18. Increased volumes combined with strong a further 32 per cent in 2017–18. This followed gold prices to deliver a 5 per cent increase in the value the start-up of several new LNG projects marking of the sector, from $10.9 billion in 2016–17 to the last of the “mega” LNG investment projects to $11.4 billion in 2017–18. reach production. Alumina and bauxite sales accounted for 7.5 per cent In 2017–18, crude oil volumes were down 11 per cent of mineral sales and 6 per cent of total sales. Sales to 4.8 gigalitres (GL), while condensate production volumes increased more than 4 per cent year–on–year, increased 18 per cent to 7.1GL. Improvements in the attributable to a substantial increase in bauxite sales, prices received by WA producers contributed to the which offset a decrease in alumina sales. This meant increase in the value of crude oil and condensate that the value of the sector increased 30 per cent to sales, which rose for the first time in seven years from $6.6 billion in 2017–18. $4.3 billion in 2016–17 to $5.6 billion in 2017–18. 4 WESTERN AUSTRALIAN MINERAL AND PETROLEUM STATISTICS DIGEST 2017–18 100 US$ A$ 80