OLYMPIC DAM

The Hon. M. PARNELL (14:57): I seek leave to make a brief explanation before asking a question of the Minister for Regional Development on the release of the Olympic Dam expansion supplementary environmental impact statement.

Leave granted.

The Hon. M. PARNELL: On Friday BHP Billiton realised its preferred model for the creation of the world's largest open pit mine at Olympic Dam. The company's model overwhelmingly involves the export of our uranium infused copper concentrate for processing in China. As the long-term job-rich component of the project is in the processing, BHP Billiton's preferred model will mean the export of significant numbers of South Australian jobs and flow-on economic benefits.

In 2007 Premier Mike Rann, clearly concerned about the enormous negative impact on South Australia of BHP Billiton's 'China option' preference, put out a media release headlined, 'BHP Billiton's "China option" is not South Australia's option'. The first line of this release reads:

Premier Mike Rann has told BHP Billiton that the South Australian government will strongly oppose any moves by the company to do most of the processing of minerals from the expanded Olympic Dam mine overseas.

The issue of domestic versus overseas processing of minerals featured heavily in many of the 4,000-plus submissions from community, economic and scientific experts on the original Olympic Dam EIS. Yet, in all of the reported 15,000 pages of the supplementary EIS released by the world's richest mining company on Friday, this option is dismissed in just four short dot points, with the explanation that this option was assessed but rejected because the additional cost of building a new processing unit on site would 'not provide the optimal return on investment'.

This cursory dismissal is surprising, considering that the Premier, in his ministerial statement yesterday, said that he and other key ministers were negotiating with BHP Billiton about maximising the amount of minerals processing in our state. Considering the strength of the Premier's rhetoric four years ago, one would assume that the government is still trying to maximise the amount of regional jobs in South Australia arising from this development by strongly pushing BHP Billiton to process our minerals in our state rather than treat the project as a gigantic quarry. My questions of the minister are:

1. As Minister for Regional Development, with a keen interest in regional jobs, what modelling has been done by the South Australian government, contrasting the jobs impact of processing the ore from Olympic Dam in South Australia compared with BHP Billiton's preferred model of sending the ore to China?

2. Has the government now abandoned its previous strong commitment for most of the processing to be done at Olympic Dam?

The Hon. G.E. GAGO (Minister for Regional Development, Minister for Public Sector Management, Minister for the Status of Women, Minister for Consumer Affairs, Minister for Government Enterprises, Minister for Gambling) (14:59): I thank the honourable member for his important questions. Although the Hon. Kevin Foley is the lead minister for matters to do with the Olympic Dam expansion, I am happy to make a few very general comments in relation to some of the comments and questions asked.

The Olympic Dam project faces some of the toughest environmental tests that we have seen, and if it meets those tests it will create thousands of jobs in this state. That is a very strong commitment from this government and myself, as well, as Minister for Regional Development. The Olympic Dam, as we know, is the world's largest uranium deposit and the fourth largest gold resource. It is also the world's fourth largest copper deposit which, under the expansion, I am advised, will increase fourfold. I am advised that the supplementary environmental impact statement (EIS) for the proposed Olympic Dam expansion was released publicly by BHP Billiton on 13 May 2011, and the supplementary EIS addressed the issues raised in more than 4,000 public and government submissions on the draft EIS.

I understand that the supplementary EIS identified changes to the project, including to the desalination plant, landing facility in the Upper Spencer Gulf, road access to the Olympic Dam tailings storage facility and proposed transport for ammonium nitrate. The South Australian government is working collaboratively with the Australian and Northern Territory governments on the assessment of the proposed expansion. The government is obviously strongly committed to ensuring that all aspects of the expansion project meet the very strict environmental standards. It is encouraging to see that BHP Billiton is committed to several sustainability measures, including renewable energy for the desal plant, water pipeline and solar hot water systems as well.

The benefits of the Olympic Dam development to the state's economy and its communities will be immense and long term, and that is very important to this government. The state government is expected to make a decision on the adequacy of the supplementary EIS before the end of the year. In relation to any specifics around modelling in relation to jobs or any other modelling, I am happy to refer those questions to the Hon. Kevin Foley in another place and bring back a response.