Question Time

MINERAL EXPLORATION

The Hon. I.K. HUNTER (14:58): I seek leave to make a brief explanation before asking the Minister for Mineral Resources Development a question about the Plan for Accelerating Exploration.

Leave granted.

The Hon. I.K. HUNTER: I understand that the South Australian government has worked to assist the mining industry through the implementation of successful initiatives, such as the Plan for Accelerating Exploration, otherwise known as the PACE initiative. Will the minister provide an update to the chamber on the progress of this PACE initiative?

The Hon. P. HOLLOWAY (Minister for Mineral Resources Development, Minister for Urban Development and Planning, Minister for Industrial Relations, Minister Assisting the Premier in Public Sector Management) (14:59): I thank the honourable member for his important question. South Australia's $30.9 million Plan for Accelerating Exploration (PACE) initiative is now recognised throughout Australia and around the world as one of the most successful government initiatives in stimulating new mineral discoveries and attracting and securing major levels of mineral exploration investment.

The Premier released the Labor Party's Mining in South Australia Policy 2010 during the recent election campaign that resulted in this government being returned for a third term. The cornerstone of this policy is a $10.2 million expansion of the PACE initiative which will help further drive resources exploration and mining developments in this state.

The new PACE initiative, PACE 2020, has been developed to build on the success of the initial PACE initiative and is focused on maintaining mineral exploration levels at or above South Australia's Strategic Plan target of maintaining minerals exploration spending at more than $100 million per year. Not only does PACE 2020 offer an opportunity to build on previous successes, it also allows us to respond to the current pressures and issues faced by the resources sector in the aftermath of the global financial crisis.

I was delighted recently to announce 23 resource exploration projects of drilling grants totalling $1.35 million from the sixth round of funding under the PACE initiative. The variety of projects funded in the latest round is very encouraging and clearly demonstrates that PACE is continuing to generate worldwide interest in South Australia as an investment destination. The successful projects were among 63 high quality applications which included minerals, petroleum and geothermal prospects in South Australia. In the first five years of PACE, the successful outcomes from the eight PACE themes have been a primary contributor to the strong growth in the exploration minerals sector in South Australia.

PACE Theme 2 Drilling collaborations PIRSA Industry has delivered a number of significant new mineral discoveries for the state, which are unlikely to have been drilled in the absence of the PACE initiative. These drilling collaborations have also extended valuable resource estimates, tested new exploration models and deposit styles, and contributed hugely to the geological understanding of South Australia. A total of $11.35 million of PACE funding has been directed towards 191 successful exploration drilling projects rounds 1-6. These projects were spread across all regions of the state targeting a wide range of commodities and include: the Carrapateena prospect; the Four Mile project; the Bramfield, Malache and Oakdale prospects; and the Gullivers and Dromedary heavy mineral sands prospects. PACE 2020 shares the core principles of the original PACE initiative, namely, economic stimulation, accessibility to land, increasing cultural awareness and balancing development with the environment.

The programs of PACE 2020 have been specifically designed to drive forward mining development and will continue to act as the primary mechanism in building South Australia's international profile and strengthening investor confidence in the state's resources sector. Imitation is the highest form of flattery, and mining jurisdictions around the country have either developed or are in the process of developing similar incentive schemes. To stay at the forefront of innovation, South Australia's PACE initiative has been adapted to ensure we can continue to stimulate new discoveries that ultimately lead to new mining developments.

A PIRSA customer survey indicated that 96 per cent of respondents stated that PACE was very effective in increasing industry awareness of the exploration opportunities in South Australia. Mineral exploration expenditure is a lead indicator of the buoyancy of the industry during periods of good economic times and rising commodity prices. The year before the introduction of the PACE initiative, 2003, mineral exploration expenditure in South Australia stood at $35.9 million, just 4.9 per cent of the national mineral exploration spend. Mineral exploration expenditure of calendar year 2008 exceeded $300 million, or 12.2 per cent of total Australian mineral exploration expenditure.

South Australia continues to significantly surpass the South Australian Strategic Plan target of maintaining annual expenditure on exploration above $100 million. The South Australian government has worked hard in the past eight years to create a climate of certainty within the state. The PACE initiative has been an incredibly successful program, delivering extraordinary growth in the minerals and energy sectors for South Australia. I am confident that PACE 2020 will continue to be a key driver for sustaining economic development in this state through the minerals and energy sectors.