Access to the Port of Whyalla

The Hon. P.B. MALINAUSKAS (Croydon—Premier) (14:04): I seek leave to make a ministerial statement.

Leave granted.

The Hon. P.B. MALINAUSKAS: It has been almost three months since my government took decisive action to secure the long-term future of the Whyalla Steelworks by placing OneSteel Manufacturing into administration and appointing Mark Mentha, Sebastian Hams, Lara Wiggins and Michael Korda of KordaMentha as administrators. Since then, the administrators have been undertaking the process of identifying risks at the steelworks and prioritising them by reference to an issue's importance from a safety perspective in the first instance and the operational impact if left unaddressed, like critical maintenance.

To date, the administrators have spent millions on items directly attributable to critical maintenance and safety measures. This expenditure covers critical parts, materials, maintenance and other safety-related items designed to prevent equipment breakdowns, mitigate operational risks and protect worker safety. And this does not include expenditure on raw materials, such as coking coal, that are critical for the ongoing operations of the steelworks.

However, not all risks arise from the apparent lack of maintenance and capital spend by the previous ownership. The administrators have advised the state of a purported lease agreement granted by OneSteel to Whyalla Ports Pty Ltd, a separate company owned by GFG. The lease was entered into without the prior consent of the state of South Australia. Maintaining access to the Port of Whyalla is essential for the Whyalla Steelworks operations. Iron ore mined by OneSteel is exported via the port and OneSteel receives key supply shipments from the port, including coking coal, dolomite and limestone, which are all required for steel production.

The state has seen fit to clarify the status of the land subject to the purported lease, of which OneSteel is the registered proprietor, for the purposes of operating the Port of Whyalla. That is why my government will give notice to the South Australian parliament that we will introduce the Whyalla Steelworks (Port of Whyalla) Amendment Bill 2025 to provide this clarity. The bill amends the Whyalla Steel Works Act 1958, formerly the Broken Hill Proprietary Company's Steel Works Indenture Act 1958, which approves and ratifies an indenture between the state of South Australia and OneSteel relating to the operation of it steelworks in Whyalla.

The importance of pit to port operations is a key feature of the act and indenture, as well as the earlier indenture ratified by the Broken Hill Propriety Company's Indenture Act 1937. The indentures require consent of the state for the transfer of rights, obligations, powers, benefits and privileges conferred on OneSteel by the indentures to another person or company.

The bill has been drafted out of an abundance of caution to clarify the effect of the failure to obtain prior consent and make it clear that the purported lease agreement granted by OneSteel to Whyalla Ports never had legal effect from the beginning. The bill also clarifies that the creation of an interest in the tramways, railway and other infrastructure constructed on the port facilities, other than by and for OneSteel, is void and that the infrastructure forms part of the land and is not personal property.

This reflects the terms of the indentures which vest in OneSteel the rights to construct and take the benefit of tramways and other infrastructure at the Port of Whyalla. Nothing in the bill prevents OneSteel or any prospective purchaser from entering into contractual arrangements in respect of the Port of Whyalla in the future, subject to the indentures and relevant consent requirements.

The state remains committed to Whyalla and the domestic production of structural steel in our state. Without sovereign steel we would rely on steel and capability from overseas amid an increasingly uncertain international climate and a national housing crisis. Sovereign steel is critical to our national interest and security, and my government is committed to its survival.