PORT LINCOLN IRON ORE EXPORT FACILITY

The Hon. R.L. BROKENSHIRE (15:31): I seek leave to make a brief explanation before asking the Minister for Mineral Resources Development a question about the Port Lincoln port facility.

Leave granted.

The Hon. R.L. BROKENSHIRE: Family First supports mining and infrastructure development as long as it is done in a balanced way, taking into account community concerns. In regard to the Centrex Metals application, and other projects that show there are significant mining opportunities on Eyre Peninsula, the community are telling me that they support and prefer a new port facility built away from the city of Port Lincoln.

The minister has approved a supposedly temporary 10 year permission for a bulk handling facility right in the middle of the city of Port Lincoln, which the community tell me is 10 years too long for the clean green tuna farming industry so vital to the area and 10 years too long for the residents of Port Lincoln, who have to suffer iron ore dust and other inconvenience. My questions are:

1. As to the validity of using section 49 of the Development Act (a section designed to handle issues of public infrastructure), does this section retain appropriate relevance for this situation, which is a refurbished piece of private infrastructure for one operator use? The use of section 49 will effectively remove any reference for decision-making from the local community. How does the minister justify this section?

2. Why did the EPA issue three reports that were softening down each time on its concerns about the impact of Centrex using the Port Lincoln jetty facility?

3. Given that this approval process has been confirmed by the government only in recent times, will the minister explain to the council why a letter to Mr Mark Cant, signed on 13 March 2009 by Mr Phil Tyler, Executive Director of Small Business and Regional Development, Department of Trade and Economic Development, states:

In relation to Centrex, the SA government is supporting the company's efforts to export its minerals. The first Centrex minerals exports will be via Port Lincoln. The development application for the Port Lincoln minerals export facility using the main wharf has been given crown development…

and the letter continues.

The Hon. P. HOLLOWAY (Minister for Mineral Resources Development, Minister for Urban Development and Planning, Minister for Small Business) (15:35): In relation to the last part of the question, section 49 is the crown development section of the act. That was considered to be an appropriate way of dealing with it. The development is over crown land. Of course, the ports are now being long-term leased to Flinders Ports, but certainly the land is out of council districts. It is in the harbour. I believe that the crown development provides an appropriate way to consider such proposals. It requires a similar level of environmental assessment as if it had been done as a major project under section 46 of the Development Act.

There has been significant input from the community as well as from government agencies, such as the EPA, in relation to that particular matter. In his question, the honourable member referred to iron ore dust. I remind the council—and I did answer a question about this some time ago—that a significant number of conditions apply in relation to the approval. In fact, there were 12 basic conditions, one of which was:

The facility herein approved must be designed and constructed to ensure that no visible haematite-bearing dust is emitted to air from the receipt, storage, transfer or shiploading operations.

The reason why the proposal took a significant amount of time to be assessed was that the EPA initially, as I understand it, raised some issues in relation to the potential for algal blooms being created by iron ore dust. I believe that it sought—quite appropriately, as the agency that has to license this—additional advice in relation to that matter and ultimately satisfied itself that the likelihood of that was small. That did take some time, but it was appropriate. That is what we expect agencies such as the EPA to do with these complex proposals.

Finally, the government has made it clear that, for the long term, the future of the iron ore industry on Eyre Peninsula does require a new port. We believe that the approval of this proposal will help establish the credibility of the iron ore industry on Eyre Peninsula. Port Lincoln has been used as an export port for grain for many decades now. Port Lincoln was originally established as a port. Prior to the development of a new port, it is our expectation that the company would make clear that, with the cash flow from this particular operation, if there is to be further expansion of the iron ore industry, that cash flow should be employed towards the development of a new port.

Subsequent to my decision, I note that the Foreign Investment Review Board has approved an investment within Centrex from WISCO, a Chinese company, the Wuhan steel company, which is a very significant steel producer. With its significant equity now in the project, we certainly believe that that will improve the capacity of Centrex to inject capital into this process. So, the reason the government has put a life on it, time operation limits and a volume limit—that is, 1.6 million tonnes of ore a year—is to ensure that, while this can enable in the short term the iron ore industry to be up and running, over the longer term we would wish to see a port developed. The company already has a site that it believes is suitable at Sheep Hill, but obviously more work will need to be done on that particular location. I believe that there is water more than 20 metres deep less than half a kilometre offshore, which would make it a very suitable site, providing that tides and other matters are suitable.

We would certainly hope that over the next few years work can begin on that particular project, which not only would advantage the mining industry on Eyre Peninsula but also could potentially benefit the grains industry as well. We always learnt at school that Port Lincoln was the only natural deepwater port we had. Of course, what was deep then at about 14 metres is now somewhat too shallow for the new cape size vessels, and above, which require 20 metres draft.

Times have moved on and clearly it will be in the interests of, ultimately, both the grain and mining industries to develop a port that can take these large vessels that require 20 metres or more of draft. It is an interim decision, the government accepts that, but one which in the long term will ensure that the economic diversity of Eyre Peninsula is guaranteed.

The honourable member talked about the aquaculture industry, and I am sure he is aware of the difficulties currently facing that industry because of the recent international decision to cut the tuna quota. It is in the best interests of Eyre Peninsula that the economy is diversified. While the government's decision is controversial in some parts of Eyre Peninsula, it has been warmly welcomed in other parts because of the benefit this would mean to diversify the economy on Eyre Peninsula. Certainly the government will continue to work for the development of a new port during the life of this project. The cash flow that will be generated should enable that to happen.