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Category Archives: South Australia

Third state signs on for national IR laws

Ewin Hannan | June 10, 2009

Article from: The Australian

TASMANIA has joined South Australia and Victoria in handing over its industrial relations powers to the commonwealth but NSW and Queensland remain non-committal about embracing uniform national workplace laws.

Ahead of a meeting between Julia Gillard and state ministers tomorrow, the Tasmanian cabinet yesterday gave in-principle approval for the state to refer the balance of its private sector industrial relations powers to the Rudd government.

Tasmania’s Workplace Relations Minister, Lisa Singh, said the cabinet decision was a vote of confidence in federal Labor’s Fair Work Act.

“The Howard government, under Work Choices, took all constitutional corporations into the federal industrial relations system,” she said. “However, sole traders and partnerships continued to be covered by state-and territory-based jurisdictions, causing confusion for workers and employers. These changes remedy that.”

The referral applies only to the private sector, and the Tasmanian public service will not be affected by the decision.

“For workers, access to modern awards means simpler, nationally consistent wages, loadings and penalty payments that will be revised on a regular basis,” Ms Singh said.

“For employers, participation in the national system will also slash red tape as well as simplifying and streamlining compliance measures.”

The South Australian government earlier announced it had joined Victoria in referring its industrial relations powers to the commonwealth. Queensland and NSW are yet to declare their positions, while Western Australia appears unlikely to refer its powers, having set up its own review of state workplace laws.

Queensland Industrial Relations Minister Cameron Dick said a national industrial relations system would be a key agenda item at tomorrow’s meeting.

“The commonwealth government is pursuing a clear national agenda, and each jurisdiction must consider what model will deliver the fairest and most efficient system for both workers and businesses in their jurisdiction,” he said. “Queensland is committed to working co-operatively with the federal government, within the context of the Fair Work legislation passed by the federal parliament, to ensure that we achieve the best outcome possible for Queensland workers and the Queensland community as a whole.”

A spokesman for NSW Industrial Relations Minister John Hatzistergos said the state government would not finalise its position until all of the Fair Work legislation had been passed by the Senate.,,25613591-5013404,00.html

Tuesday, 26 May 2009

The National Party is voting against the creation of thousands of new jobs for regional Australia in its decision to vote down the Carbon Pollution Reduction Scheme.

“It reveals a complete lack of understanding about the investment, industries and jobs that will flow from putting this vital piece of legislation in place,” said ACTU President Sharan Burrow.

Regional Australia will be the major beneficiary of a raft of new public and private initiatives.

Two hundred renewable energy projects generating at least 26,000 jobs are already in the pipeline, according to the latest research by energy sector consultants McLennan Magasanik Associates.

This includes solar projects in Mildura, Broken Hill and remote Queensland, geo-thermal trials in South Australia and wind turbine installations across a number of states.

“The CPRS is a critical piece of machinery that will ensure business confidence, drive research and direct millions of dollars of new investment into these projects and jobs, as Australia makes the transition to a low carbon economy,” said Ms Burrow.

“The figures show a potential national investment worth $32 billion. The Nationals’ unsubstantiated claim that the CPRS will destroy jobs flies in the face of reality.

“In Queensland alone, the report released last week by the Minerals Council of Australia shows that jobs will grow in the resources sector by 120% over the next 20 years. Gas will be a big jobs base for Queensland.

“The CPRS will also provide the means to retain and grow jobs in traditional industries, such as steel and aluminum, that are providing products for clean technologies.”

Ms Burrow said the Nationals’ obstinate and ill-informed opposition to the CPRS not only holds up job creation and Australian investment in renewable energy but fails to take responsibility for international leadership for a strong agreement in our own interest at Copenhagen later this year.

“The devastating impact of climate change is illustrated by the increasingly erratic weather patterns affecting large parts of rural and regional Australia in recent times.

“If Australia is prevented by the Coalition parties by acting quickly and constructively to combat climate change, the cost of their inaction and delay will come down hard on Australia’s farming community, as the environment deteriorates further.

“Seventy-seven per cent of Australians say the Coalition should pass the CPRS. It is time for the Nationals to listen.”

May 16, 2009 11:30pm

ABOUT 1000 workers at a Lockleys call centre have been asked by employer EDS to take a pay cut and have no guarantee their jobs are safe.

The data services provider’s parent company, computer giant Hewlett Packard, is embarking on a global plan to cut wages by up to 20 per cent in response to the global economic recession.

But Adelaide EDS staff have been told not to assume their jobs are secure, even if they agree to the cut.

Under the proposal, staff would give up 2.5 per cent of their pay and any salary-related benefits from June 1.

The Finance Sector Union has urged EDS employees to reject the offer, claiming it is illegal under present wage agreements.

Hewlett Packard, which bought EDS last year, announced in February it would slash salaries globally after first quarter profits fell 13 per ent to $2.5 billion. In an email sent to Lockleys staff – who process mortgages for Westpac – EDS said “cost actions” were needed in the face of the “current challenges”.

“We greatly appreciate your understanding and support in this difficult and challenging time, and trust that your efforts to co-operate with company policies will yield positive results for the operations of the company,” the company said in the email, titled “salary reduction letter”, a copy of which was obtained by the Sunday Mail.

“Please note that your acceptance of this request does not constitute a guarantee of ongoing employment.”

EDS does not comment on how many staff work at the Lockleys centre, but the FSU estimates the number to be about 1000. The union’s SA/NT secretary, Debbie Black, said employees could lose up to $1000 a year.

“We believe what they are asking staff to do is not entirely legal in the current industrial relations climate,” she said.

EDS Asia Pacific and Japan executive relations manager Tamara Plakalo said the pay cuts would allow it to emerge from the recession in a “powerful position”.

May 12, 2009 01:48pm

MORE than 50 new jobs will be created by a new contract for 160 new Adelaide Metro buses to be built locally, says the State Government.

The Transport Department has awarded the contract to Australian company Custom Coaches, which will build the buses at its Royal Park plant.

The $118 million deal will replace 120 buses from the existing fleet and provide another 40 extra buses over the next four years.

Manufacturing will begin this month and the first bus is expected to be completed in July.

Custom Coaches will build low-floor bus bodies and assemble seats, doors, windows, air conditioning and security cameras on to Swedish-made chassis assembled at Scania Australia’s Adelaide plant at Wingfield.

Premier Mike Rann said the deal was “a very good local jobs story”.

“Not only will this contract employ an additional 46 manufacturing staff and create five new apprenticeships … it will (also) deliver new state-of-the-art green buses to our network,” he said.

The diesel-powered buses will comply with the latest Euro 5 Plus Enhanced Environmentally-friendly Vehicle exhaust emissions standards, which do not come into effect in Australia until 2011.

Transport Minister Patrick Conlon said the buses would delivered far lower emissions than the current minimum enforced in Australia.

“Many of the buses in this new contract will be high capacity, articulated vehicles, which will run on the popular O-Bahn,” he said.

Custom Coaches chief executive Mark Burgess said the contract would have a flow-on effect for other local businesses.

“If we create 50 new jobs there will be about 150 jobs created out in the community – jobs supplying the parts we need to build buses … we’re shifting work from other states into South Australia,” he said.,22606,25467849-2682,00.html

April 29, 2009 12:01am

SOUTH Australia has the country’s worst record for the amount of money spent on infrastructure over the past 20 years, an engineering report card has found.

Engineers Australia’s analysis of roads, bridges, harbours, electricity and gas pipelines, water, sewerage and telecommunications has found the inferior investment is making the state uncompetitive.

“SA has grown the least of all the states and territories,” Engineers Australia (SA) president Doug Gillott said.

“These figures do look over a 20-year period and the trend is quite consistent, so this is a concern that over a time we are falling behind the rest of the country.”

The report found that for every $100 spent in 1988-89, SA is now spending $140 per head of population. But Australia is spending $230.

So, in 2007-08 Australia spent 1.6 times more than SA per head of population on infrastructure.

The gap between SA and the rest of Australia has widened in the past nine years, even though construction activity increased within the state.

While the report does not blame any governments, it shows from 1999- 2000, after the Labor Government came to power in SA, spending on infrastructure lagged further behind the nation and “there is now the widest ever gap between the two trends”.

“If we consistently under-invest, then as a community we’ll become less efficient and it becomes less attractive for projects to go ahead and also for people to live here because they have less amenity,” Mr Gillott said.

Western Australia and Queensland were the shining lights when it came to infrastructure spending.

But the one area where SA approached the national trend was in the construction of electricity and gas pipeline facilities.,22606,25400810-2682,00.html

Barry Fitzgerald
May 6, 2009

FORMER high-flyer OZ Minerals is to undergo wholesale board and management change to better reflect its greatly reduced size following the forced asset sales required to rid itself of its debt refinancing woes.

Five of the eight-member board, including chairman Barry Cusack and managing director Andrew Michelmore, plan to ride off elsewhere, but won’t be able to forget their time at OZ in a hurry.

Shareholders’ litigant IMF Australia plans to make sure of that, saying yesterday a $1 billion class action claim being handled by legal firm Maurice Blackburn on behalf of “hundreds” of OZ shareholders remains in the pipeline.

The potential class action was first flagged in December, but nothing has been heard since, and as of yesterday OZ had not received any statement of claim or other documents from IMF or Maurice Blackburn.

IMF would not reveal the proposed timing of the class action but it is believed to want to see OZ complete its $US1.2 billion ($A1.6 billion) in asset sales to China’s Minmetals. The deal is subject to a shareholder vote on June 11. Without the deal, OZ faced the prospect of administration.

OZ was created by the friendly merger of Oxiana and Zinifex last year, implemented by an Oxiana scrip offer for Zinifex.

IMF’s proposed class action involves alleged misleading and deceptive conduct and alleged breaches by OZ of its continuous disclosure obligations between February 28 and December 3 last year. OZ has continued to strongly refute the allegations and plans to vigorously defend itself against any legal action proposed by IMF.

Announcing its board changes yesterday, OZ said director Tony Larkin had submitted his resignation on Monday. Another director, Ronnie Beevor, will not seek re-election at the June 11 meeting.

Assuming the Minmetals deal proceeds, Mr Michelmore will resign and take up a senior executive role with the Chinese group. A search for a replacement managing director is now under way.

Mr Cusack and another director, Peter Mansell, plan to resign from the board once the new managing director is appointed. The slimmed-down OZ would then seek to appoint two replacements, who will face shareholders at OZ’s 2010 annual meeting for election.

The result is that OZ will end up with a board of six, down from the current eight. OZ shares closed 2.5¢ higher at 82¢.

The reporter owns OZ shares and is not party to any class action.

1/05/2009 4:33:00 PM

BHP has today revealed the environmental effects of its giant Olympic Dam project. Hendrik Gout wrote this article ahead of the media lock-up at which the 4000-page document was released.

Incomparable and unimaginable are not synonymous, but Olympic Dam is both. It will be the world’s biggest hole-in-the-ground, the largest copper and uranium quarry on the planet, the highest artificial mountain range on Earth and the richest mine since King Solomon.

All this just a few hours drive from Adelaide. South Australia is about to become the Colossus of Copper, the Midas of Gold. There’s just one niggling problem: the environment.

At three o’clock on Friday afternoon, BHP Billiton flicked a switch and the World Wide Web will instantly host the most massive environmental impact statement Australia has ever seen. Three-years in the making, more than 4000 pages long (110 pages to list just the guidelines), and according to Mines Minister Paul Holloway “the largest document ever prepared in this state”.

That EIS will lay out what BHP reckons are the environmental effects of expanding its Olympic Dam copper, uranium and gold mine near Roxby Downs, in the state’s far north.

By some estimates the resource is worth a trillion dollars and able to produce some 25,000 tonnes of uranium, half a million ounces of gold and one million tonnes of copper a year.

The company will ultimately dig a hole 7.5 kilometres long, five kilometres wide and more than a kilometre deep.

Stacked up, the 44 billion tonnes or so of overburden would effectively create a new mountain range. Depending on its shape, it might be 20 kilometres wide in each direction and almost as high as Mt Lofty’s 720 metres.

If so, the new artificial mountain might create its own micro-climate.

The EIS will have to address hundreds of other issues as well. Journalists will have little time to do more than scan the document when it becomes available at noon – they’ll have to read over 1000 pages an hour during the media lock-up – before their television deadlines tonight.

BHP has said it will not comment on the EIS after the weekend even though reporters can’t possibly read all the documents in the time available.

The report was initially going to be available for public comment for just 40 working days, which Mr Holloway said was more than enough time. Public pressure, led by Greens MP Mark Parnell and Liberal MLC Christine Schaefer, forced the Government to extend that to 14 weeks.

“Even with a 14 week public comment period, the community will still struggle to read and respond to the largest document ever printed in this state,” Mr Parnell said.

So what will the long-awaited report say? It looks at expanding the mine to 750,000 tonnes of copper product a year, three-quarters of its possible ultimate size.


Firstly, the EIS will have to address the mine’s water requirements. The existing Olympic Dam mine, a comparatively tiny underground operation, already uses 35 million litres of water a day. It drags this from the Great Artesian Basin: prehistoric underground water which fell as rain on the western side of the Great Dividing Range up to a million years ago. It has since percolated underground, flowing a mere one to three metres a year.

The company pays the state nothing to access this public resource under a special 1982 Act of Parliament which over-rides every other piece of legislation (including safeguards in mining Acts, development Acts and environment protection Acts) passed by Parliament before or even since.

The company is actually licensed to take up to 42 million litres of water a day from the Great Artesian Basin, but even this will not be enough to quench the new mine’s thirst.

Today’s EIS will canvass building a giant desalination plant on the coast of the fragile Upper Spencer Gulf. That plant will produce about 200 million litres a day, 80 of which might be bought by the State Government to supply towns around the Eyre Peninsula. The State Government has committed $125 million and the Commonwealth $120.

This means nearly a quarter of a million dollars of state and federal funds are going into the desalination plant, so both governments have serious EIS issues and responsibilities to address. It means federal Environment Minister Peter Garrett may have the power of veto over the desal plant.

The Gulf fishing industry and environmentalists will closely examine the document to see what it makes of the tens of thousands of litres of super-saline water the plant will release.

“This is the worst possible place to build an internationally-sized desalination plant,” Australian Conservation Foundation campaigner David Noonan said this week. “The Gulf is shallow, low-flushing. It’s the breeding ground of the giant cuttlefish which is extremely sensitive to changes in salinity. The plant should be built on the ocean, not the gulf.”

Adelaide University marine biologist associate professor Bronwyn Gilanders says the sea around Whyalla is actually the world’s largest cuttlefish breeding zone, and that the plant could wipe them out.

“Squids and Cuttlefish are generally short-lived. So they live a year; they breed only once. So if you damage the eggs or affect their reproductive ability then potentially that will have devastating consequences on the population.”

The Independent Weekly has reason to believe that BHP’s EIS will dismiss the threat, and that its research will claim increased salt levels will not affect local sea life.

“Point Lowly is the last place on the SA coast you would put a desal plant,” says Mr Noonan, “and there are alternatives. We could build a reverse osmosis plant at Elliston on Eyre Peninsula’s west coast. Elliston has the ocean flushing that Pt Lowly lacks and enormous potential for year-round wind energy. Taxpayers are paying 20 per cent of the desalination plant’s capital cost and we should also have a big say on where it goes. It’s not good enough to leave it up to BHP.”

BHP wants to build at Port Bonython near Whyalla purely because it’s cheaper than on the ocean coast. The Independent Weekly expects the EIS to say that it will pipe desalinated water about 350 kilometres to the mine. At a cost of about $1.2 million per kilometre, such a pipeline will cost the company more than $400 million and it may want to take the shortest possible route irrespective of environmental concerns along the way. The EIS will talk about the pipeline as well as the plant, and conclude that environmental problems or risks are negligible or manageable.


Desalination plants require vast amounts of energy. The Independent Weekly expects the still-secret EIS to say it will need about 75 megawatts to run the plant, and a further 25 megawatts to pump the water from Port Bonython to Olympic Dam.

The EIS is likely to recommend a gas-fired generator to power the desal plant, but the actual mine’s energy requirements are far larger than that. At full production, the mine will use one-third of South Australia’s current electricity requirements. This will affect SA’s energy future for the mine’s 100-year life.

Where will it get the power? BHP is almost certain to say it wants a gas-fired power station at Olympic Dam and buy an increased load off the grid.

Government greenhouse targets set out in the State Strategic Plan want carbon dioxide emissions capped to 108 per cent of the 1990 levels by the year 2012. Premier Mike Rann has also given a commitment to limit CO2 emissions to 60 per cent of 1990 levels by 2050. But the mine’s expansion could increase SA’s total CO2 emissions by more than 10 per cent.

Prime Minister Kevin Rudd has now signed the Kyoto accord which sets similar goals, and that means Peter Garrett may have an influence on energy as well as water.

And then there’s the diesel. The expanded mine will a million litres of diesel a day, or two billion litres, just to reach the ore. The Federal Government is paying BHP a diesel fuel rebate of 18.5 cents a litre, a taxpayer subsidy to the world’s largest mining company.


Open-cut mining is essentially a simple operation: dig it up and offer it for sale. But rather than ship raw earth around the world, mining companies generally process the rock to some degree by concentrating ore on site. Despite early promises, BHP will not go a step further and build a smelter here. Smelting produces mineral in its almost-pure form as well as thousands of direct and indirect jobs.

BHP initially indicated the concentrate would be smelted here and not in China. The Premier believed such assurances. “What we’re negotiating with BHP Billiton for is to make sure that as many jobs are done here in SA, that the work is done here rather than processed offshore,” he said in 2007.

“We’ve been negotiating with BHP Billiton and, despite what I read in one newspaper recently, the negotiations have been proceeding amicably.”

But the newspaper was right. In October 2008 the company finally announced that it had abandoned smelter plans. BHP uranium and Olympic Dam development boss Graeme Hunt said the company had given “very careful consideration” to processing options, and had decided to sell its product as concentrate rather than as refined metal.

“On-site smelting has a high capital cost and increases project execution risk, particularly in the isolated area in which Olympic Dam is established,” he said despite the Premier’s fury over the job losses.

But while the Premier said the Government would strongly oppose the company doing most of the processing overseas in 2007, by 2008 Treasurer Kevin Foley knew he was licked. “We want as much value added as possible to take place at the mine site but that is to be negotiated. One has to be realistic and constructive in negotiations,” Mr Foley acknowledged.

That decision has enormous repercussions. The EIS might say that if it exports 1.6 million tonnes of copper concentrate, that will make 400,000 tonnes of pure copper in China – and a few thousand tonnes of recoverable uranium. A country like China can extract that uranium and use it for nuclear power, and while Mr Rann opposes such a power station here he’s a strong advocate for it elsewhere.

On a visit to China in 2008, the Premier said his confidence had been buoyed by its potential as a uranium market. “Every single meeting I went to was about uranium,” he said. “We have got 50 per cent of the world’s uranium in SA. We are in pole position.”

He may have suddenly been bumped to the back of the grid. The Independent Weekly understands that the Federal Government is planning much tougher safeguards relating to uranium sales to China, even if it’s gift-wrapped in copper concentrate. BHP does not yet have export permits for that uranium. In May next year nuclear non-proliferation nations, Australia included, will meet in New York. Australia may want a new international treaty to make sure Olympic Dam uranium does not end up in Chinese bombs.


Concentrated ore contains much higher percentages of gold, uranium and copper than what’s dug out of the ground. The stuff left behind after this process, called tailings, still contains vast quantities of radio-active material. The EIS will go to great length to say this isn’t a problem.

But problem it may be. Tailings have about 80 per cent of the radio-activity of the original ore. They contain radium and other decay products. Tailings are dust. They blow in the wind. There is wind in central Australia. An honest EIS might suggest that tailings have the potential, not to put to fine a point on it, to pollute.

A long way north of Olympic Dam is the Ranger uranium mine in NT’s Kakadu National Park. That mine will close in 2021. Federal Government environmental guidelines specify that the Ranger tailings be re-buried and rendered inactive for 10,000 years.

Peter Garret’s office, which will take longer than 14 weeks to assess this EIS, may demand the same level of safety at Olympic Dam.

If you walk around Olympic Dam now, you’ll see a mountain of tailings from the existing mine. It’s piled 30 metres high – the same height as a six-storey building – over four square kilometres. The new expanded mine could produce more dust than the average home vacuum cleaner has to handle – 70 million tonnes of tailings every year.


The EIS is a statement of environmental impact, but it will also address royalties – the money the company pays the state to mine the ore. According to calculations done by SA Unions, mining royalties in this state are less than half those in other mining states, with only 3.5 per cent here compared with 7.5 per cent in WA for bauxite and iron ore, and seven to 10 per cent in Queensland.

So what’s the next step? BHP will hold a series of Eyre Peninsula and local town meetings from late this month, explaining its proposal and why it says the environmental risks are miniscule. Meanwhile scientists, economists, environmentalists, fishing groups and pastoralists will speed-read the document and make a response. BHP is then obliged to consider those responses and deliver its own verdict on the submissions. That’s when the fun starts.

When the final EIS, the supplement, is complete and released it will be assessed by state and federal governments. The Independent Weekly believes that this process will not be complete before the next state election due in March 2010. That means SA will go to the polls not knowing the government’s response to “the biggest document ever produced in this state” or the biggest mining project this country has ever seen.

Nor will we know how governments are going to deal with environmental issues which touch on global questions such as Australia’s part in the nuclear cycle, national demands such as energy requirements, and local threats such as a briny Spencer Gulf.

So here’s a prediction. Tomorrow’s EIS will say the project can go ahead on environmental grounds. The company will start moving to begin expansion and hope for a global economic recovery to coincide with increased production. BHP will pass the break-even point on its multi-billion investment within the first two decades, and after that it’s money in the bank all the way down to the year 2100.

But first, there’ll be new legislation presented in State Parliament to legalise the process. It will be a new form of the 1982 Roxby Downs Indenture Ratification Act. It will, once again, over-ride every other Act of Parliament passed up to now and into the future. The first that South Australians see of that legislation will be after the state election.

And BHP Billiton’s Olympic Dam will have an economic and environmental impact that is synonymous with mining on this scale: incomparable and unimaginable.

By Pia Akerman
May 04, 2009 07:44am

THE race to win a multi-billion-dollar contract to build eight naval frigates has begun, only hours after the plan was announced in the defence white paper.

The states and defence companies are already jostling to spruik their credentials, despite warnings from defence experts that the project would be years away, even if money could be found to pay for it, The Australian reports.

Premier Mike Rann has announced South Australia will bid for the ships to be built at the Techport site in Adelaide’s northern suburbs, vowing work could begin once construction of the Air Warfare Destroyers there was complete.

“There are no other facilities in Australia that can compare with Techport, so we are in a very good position,” Mr Rann said.

“The South Australian Government will be bidding to have the next generation of frigates built in South Australia both for consolidation onsite and in terms of high-level modules.

“It’s the perfect follow-on to the Air Warfare Destroyers … in terms of the skill set, the infrastructure, the hi-tech companies (in Adelaide).”

But a spokesman for BAE Systems Australia said they would be the biggest contender for the project, using the Williamstown shipyard in Victoria, acquired last year as part of BAE’s takeover of Tenix Defence.

Jim McDowell, chief executive of BAE Systems Australia, has previously spoken of his company’s “natural capability” to build a replacement for the Anzac frigates, but said there would need to be “significant” sharing of work between BAE and commonwealth-owned submarine builder ASC to handle such a vast enterprise.

A spokeswoman for the Victorian Government said the state welcomed the white paper’s “significant opportunities” for the local defence industry.

Austal in Western Australia and FORGACS in NSW have also been mentioned as possible bidders for part of the frigate project.

Released on Saturday, the white paper announced plans to replace the current Anzac-class frigate with a larger Future Frigate specialising in anti-submarine warfare.

The frigates would be fitted with cruise missiles and be able to carry a combination of naval combat helicopters and maritime unmanned aerial vehicles.

Defence expert Hugh White yesterday said South Australia would probably have an advantage in bidding for the frigates, as it could probably be built on the same hull used for the AWDs.

But he poured cold water on the early enthusiasm shown for the project, saying any contractual decisions were years away.

“Those choices will not be made by the present Government, certainly not in this term of government and I would think not even in the next term,” Professor White said.

“We’re talking about a project which is at least 20 years away in terms of delivering ships.

“There are a lot of very big things to be done in naval shipbuilding in Australia first.”

Professor White said he was not convinced there was a strategic justification to replace the Anzac frigates with ships of a larger capability.,,25423976-2702,00.html

BHP Billiton Ltd says it is going ahead with the multi-billion dollar expansion to turn its Olympic Dam mine in the South Australian outback into the largest open cut on earth, but the miner still needs approval from the federal and state governments.

The open cut at Olympic Dam would be biggest man-made hole in the world, lifting ore production at the site six-fold, which would require expanded minerals processing facilities.

Underpinning the proposed expansion is uranium exports to countries like China, BHP said.

BHP has laid out an ambitious timetable for redevelopment in its 4600-page environmental impact statement (EIS) today and estimates excavation work to begin in July 2010 at the earliest.

“The expansion described in this latest EIS would be a progressive development requiring construction activity over a period of 11 years,” the miner said in a statement.

BHP said the expansion could lift uranium oxide output to up to 19,000 tonnes a year from 4,500.

“Exporting uranium to new customers like China will be an integral part of creating value from the Olympic Dam ore body,” said Dean Dalla Valle, chief operating officer for the company’s Uranium Australia unit.

“We can do this with confidence because China is subject to the same strict safeguards arrangements as all of our other customers, he said.

Australia’s uranium industry has been hamstrung since the early 1980s by political hostility to the nuclear fuel, but long-standing bans on new mines by various state governments are gradually being lifted in the face of economic crisis.

The national government is also encouraging more uranium mining and courting new export business in China.

BHP, facing downturns in its major markets as the crisis bites, has cut 200 jobs at Olympic Dam as part of some 6,000 cuts worldwide as it battles falling commodities prices and demand.

The global miner said the additional support infrastructure would include a coastal desalination plant, a new power line and possibly a gas fired power station, a train line, an airport and additional housing for workers.

The environmental grounds of the expansion still need to be approved by the federal and state governments, and then by the BHP board. Only after board approval will the miner provide cost estimations.

The miner has set the timeframe of the project at 40 years, but has left the door open to a longer operation life, suggested by the size of the mineral resources.

A longer life for the mine will require more environmental approvals.

The draft EIS will be on public display for 14 weeks, when submissions can be made to government.

However, Dalla Valle said “we still have a lot of work to do before we can tell you when this project may start and how much it may cost”.

Some analysts have suggested the expansion could cost as much as $20 billion.

With no nuclear power industry of its own but sitting on the world’s single largest source, Australia sells all its uranium overseas, making Australia the world’s second-largest supplier behind Canada.

Russia and India have also expressed strong interest in buying Australian uranium to fuel nuclear power plants.

BHP’s Olympic Dam mine to kickstart recovery

Jamie Walker and Michael Owen | May 02, 2009

Article from: The Australian
BHP Billiton has shrugged off the global economic blues to press ahead with plans to turn its Olympic Dam mine in South Australia into the largest open cut on earth and help kick the economy back into prosperity.

A 4600-page environmental impact statement, released by the company yesterday, set out an ambitious timetable for the conversion of the copper, gold, silver and uranium mine from underground to pit operations.

Work would start as early as April next year on the multi-billion-dollar upgrade.

Under BHP Billiton’s best-case scenario, excavation of the 1km-deep mine pit, and possibly construction of a pipeline to supply a gas power plant, would be under way by July next year.

By that time, a mini-city known as Hiltaba Village would be rising in the desert to house the thousands of workers needed for the project. This would be in addition to the expansion of the existing township of Roxby Downs.

The mine’s workforce would double from 4000 to 8000 when it reached full capacity next decade.

By then, Olympic Dam would be the world’s biggest single producer of uranium and one of the biggest of copper.

While the company stressed it would not release costings until the expansion received necessary environmental approvals from federal and state governments, and was then approved by the BHP Billiton board, its determination to see through planning will be a confidence-booster for the resource sector, hit hard by the global financial turmoil and reduced commodities prices.

The open cut envisaged by BHP Billiton at Olympic Dam would become the biggest man-made hole on the planet and yield $1 trillion worth of ore over its century-long life, more than $100million of which would be paid in royalties to the South Australian Government. Production would lift six-fold from 12million tonnes of ore annually to 72 million tonnes after 2020.

The news was welcomed by residents of the nearby mining town of Roxby Downs, where the boom had turned to gloom amid recent job cuts at Olympic Dam and falling local property values.

BHP Billiton will seek state and federal approvals to export up to 1.6 million tonnes a year of powdery copper-based concentrate with a low-level uranium content of about 2000 parts per million.

South Australian Premier Mike Rann, backed by the Howard government, was initially sharply critical of the company’s plan to send the concentrate to China rather than refine it here.

Mr Rann adopted a more conciliatory note yesterday, welcoming the EIS.

“We will work with BHP Billiton to maximise the number of jobs here … the point is it hasnot yet been approved,” Mr Rann said.

The existing underground operation at Olympic Dam currently ranks it as the 16th-largest in copper and third in uranium in the world.

Underground mining can extract only about 25 per cent of the ore containing recoverable quantities of copper, uranium, gold and silver; an open pit would allow up to 98 per cent of the known ore body to be exploited.

The proposed cut operation would work in tandem with the existing underground mine. The current smelter would also be expanded, although not to the extent that would be the case if two-thirds of the copper concentrate produced was not sent to China for processing.

Concern for the struggling Australian Giant Cuttlefish, which breeds in the area and was said by some conservationists to have been threatened by discharge from the desalination plant, have been dismissed by BHP Billiton.

After a specially extended 14-week public consultation period on the EIS, which ends on August 7, BHP Billiton will provide federal and state governments with a supplementary report for assessment. If the expansion were approved, the company’s board would make a final decision early next year.

South Australian Mineral Resources Development Minister Paul Holloway yesterday said the Government was not blinded by the wealth on offer at Olympic Dam.

“If there are issues we do not believe have been addressed properly, then we will ask BHP to reconsider them and make appropriate amendments,” Mr Holloway said.,25197,25416641-5006787,00.html