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House of Assembly - Fifty-Third Parliament, First Session (53-1)
2014-05-07 Daily Xml
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Gillman Land Sale

Mr MARSHALL (Dunstan—Leader of the Opposition) (15:03): I have a supplementary question, sir. Why was it not in the public interest to go to tender on that project?

The Hon. J.W. WEATHERILL (Cheltenham—Premier) (14:03): I set this out at length before—and this was an argument you advanced during the election campaign and lost—but if you want the long version we will give you the long version. The truth is that no agreement for sale has in fact been concluded yet; it is only an option. The option was provided because it gave extraordinary benefit for the people of South Australia in this way: first, it attracted a premium price; secondly, it provided for a developer to use—

Mr Tarzia interjecting:

The Hon. J.W. WEATHERILL: We know because the relevant independent statutory body told us so.

The SPEAKER: The member for Hartley is called to order.

The Hon. J.W. WEATHERILL: The relevant independent statutory body, Renewal SA, told us so. They undertook an exercise to evaluate whether it was good value for money and they told the government that, in fact, it was good value for money. The proposition that was brought to me first by Mr Raymond Spencer, the head of the Economic Development Board, was that this was a proposal which was urgent and in the public interest.

It was about ensuring that a piece of land, which had lain there disused since the old MFP days, a piece of land there at Gillman, could be developed—not using state government's money, but developed using the private sector's money. That money would have to be raised through using investors—South Australian, interstate and overseas investors—to actually put their money on the line to invest the many tens of millions of dollars to bring this land up to a standard which would allow it to be used as a crucial piece of infrastructure for, amongst other things, the mining services sector.

That was an extraordinary opportunity for us here in South Australia. Given that we had identified the fact that this particular endeavour—that is, the mining services sector—is a crucial priority for South Australia, and given that there is a race, essentially, across the nation, for who will be the hub for the nation to actually provide mining services—in particular, for the exciting opportunities in the Cooper Basin for the development of our gas resources—it was critical that we seized an early opportunity for us to be able to provide critical infrastructure for mining services.

What we had was a company that was coming to us with an unsolicited bid which meant that they were proposing to use their money to develop this land in a fashion which would provide for that opportunity—not only the many hundreds of jobs associated with the development of this land, but also the potentially many hundreds and thousands of jobs that would be available if they created a hub for mining services here in South Australia.

So, a company like that comes to us with a proposition of that sort. They say to us, 'We are not going to be in a position to actually go out and seek the international investors that would be necessary to put at risk all of their money unless we have a period of exclusivity so that we can carry out the due diligence necessary for us to be able to then present a serious business case to that community.' So, once we had satisfied ourselves that it was an appropriate land use, once we had satisfied ourselves that this was actually a premium price and good value for money, of course, we said, 'Yes, you have that period of exclusivity.'

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