MINING SECTOR

The Hon. I.K. HUNTER (14:39):My question is to the Minister for Mineral Resources Development. Will the minister provide details of any new developments in the mining sector that will particularly benefit communities in the far west of this state?

The Hon. P. HOLLOWAY (Minister for Police, Minister for Mineral Resources Development, Minister for Urban Development and Planning) (14:39): I thank the honourable member for his question. I am delighted to inform him and other members that the board of Iluka Resources last month approved $420 million in capital investment in its Jacinth-Ambrosia heavy mineral sand mining project, about 200 kilometres north of Ceduna. This announcement by Iluka Resources is further evidence of how the unprecedented surge in mineral resources exploration in South Australia, encouraged by this government, can be successfully translated into new mining operations. As the then acting premier, Kevin Foley, said at the time of the announcement, Jacinth-Ambrosia is just the latest in a steady roll-call of mining projects that have been given the green light in South Australia.

When this government came to office in 2002 there were just four operating mines in the state despite the worldwide commodity boom. Six years later that number has doubled. I am delighted to say that there are many other projects in the pipeline either under construction or being assessed by Primary Industries and Resources South Australia.

The renewed confidence resource companies have to invest in this state is due in no small measure to the Rann government's very tangible support for mineral exploration through the Plan for Accelerating Exploration (PACE). Iluka's decision to go ahead with a $420 million capital investment in its Jacinth-Ambrosia project confirms that the centre of gravity of the mineral sand industry is about to undergo a major shift to South Australia.

I am also heartened by Iluka's confidence that further discoveries of mineral sands are likely to be made within its tenement holding of more than 52,000 square kilometres in the Eucla Basin. New projects, such as Jacinth-Ambrosia, and the potential for other discoveries within the Eucla Basin at Tripitaka, Dromedary and other deposits in the region, as well as mining operations already under way at Mindarie in the Murray Mallee, send a strong signal that South Australia will eventually assume the mantle from Western Australia as the country's major source of mineral sands, in particular, zircon.

Subject to the necessary regulatory approvals, Iluka plans to begin mining and shipping heavy mineral concentrate from South Australia by the end of the first quarter in 2010. The project is estimated to contribute about 3 to 5 per cent of the South Australian Strategic Plan target of increasing mineral production to $3 billion by 2014. Investment by Australian Stock Exchange-listed Iluka Resources in the mineral sands project will create up to 250 jobs during the construction phase of the project.

A large percentage of these positions are likely to be filled locally, including opportunities for indigenous workers. Iluka Resources expects to create 110 permanent jobs during the operation of the mine. This really has the capacity to do great things for the West Coast. Anyone who has been to Ceduna in the past few years cannot help but be impressed by the resurgence in the community there. I think that the fishing is still pretty good over there as well.

State government assistance through the Planning and Development Fund has upgraded the town centre, with plans to extend the redevelopment down to the jetty. Iluka expects to ship heavy sands from Ceduna, which will add even more vitality to that regional centre. The Jacinth-Ambrosia deposits are expected to produce an estimated 2.9 million tonnes of recoverable zircon during the estimated 10-year life of the mine.

Iluka expects to sustain annual production of about 300,000 tonnes of zircon from the Jacinth deposit from the first full year of operation in 2011 until 2014. As I mentioned in my opening remarks, the go-ahead for investment in the Jacinth-Ambrosia project underlines the success and foresight of this government's PACE initiative.

The funding provided through PACE has helped exceed the goal for mineral exploration spending set out in South Australia's Strategic Plan. Expenditure in mineral exploration in South Australia reached a record $331 million in 2007 which, of course, was more than triple the $100 million target set out in the Strategic Plan. This expenditure on exploration is beginning to pay dividends. Iluka's investment of almost half a billion dollars in this project follows the beginning of construction work at the $1 billion Prominent Hill copper and gold mine near Coober Pedy.

Terramin Australia is expected to begin production this month at its lead/zinc mine near Strathalbyn. The Mindarie heavy sands project has already begun to export concentrate, while Termite Resources NL, a 100 per cent owned subsidiary of IMX Resources, has been granted a mining lease for its high-grade iron ore-copper-gold project at Cairn Hill near Coober Pedy.

South Australia is about to ride a mining boom. Iluka is just the latest in what will, I expect, be a long line of successful projects in the state, projects that mean both valuable export dollars for the economy and well-paid jobs for South Australians.