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Legislative Council - Fifty-First Parliament, Second Session (51-2)
2008-04-02 Daily Xml
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WHYALLA STEELWORKS

The Hon. R.P. WORTLEY (14:42): I seek leave to make a brief explanation before asking the Minister for Mineral Resources Development a question about the Whyalla steelworks.

Leave granted.

Members interjecting:

The Hon. R.P. WORTLEY: The only time the opposition likes talking about regional areas is when there is gloom and doom and hardship on the land. Members opposite hate hearing good news stories.

Members interjecting:

The PRESIDENT: Order!

The Hon. R.P. WORTLEY: Whyalla is currently undergoing an economic revival. Jobs are being generated and investments are being poured into the city. Will the minister provide an update on the changing fortunes being experienced by the city of Whyalla?

The Hon. P. HOLLOWAY (Minister for Police, Minister for Mineral Resources Development, Minister for Urban Development and Planning) (14:43): I am delighted to do that for the honourable member. As he says, it is a pity that members opposite dislike hearing good news, because the future of Whyalla is looking bright; in fact, it is the brightest it has looked for decades. I was delighted, last month, to attend OneSteel's Project Magnet ceremony at the mine site just outside Whyalla at Iron Duke.

OneSteel has invested $400 million in Project Magnet to extend the life of the Whyalla steelworks. That is a major commitment to this important regional city and this state that will strengthen an important industry. At the core of Project Magnet, which is now fully operational, is the conversion of the Whyalla steelworks to produce steel from magnetite ore rather than hematite and also the increased sale for export of hematite ore.

The major advantage of Project Magnet is the ability for the upgraded plant to use magnetite reserves—a move that is expected to extend the life of the Whyalla steelworks from 2020 to at least 2027. Of the 11,600 workers employed by OneSteel across Australia, more than 1,700 work in Whyalla, and that workforce does not include the large number of contractors that service the mining, transport and steelworks activities of OneSteel.

As a consequence of the conversion to magnetite as a feedstock, OneSteel will be able to increase its hematite iron ore sales from about 1 million tonnes to 4 million tonnes a year. Steel production will grow by an additional 100,000 tonnes a year and about 200,000 tonnes a year of pellets can also be produced for sale as a result of Project Magnet.

With any project like this, there are environmental elements to be considered. I am pleased to say that Project Magnet has already delivered a significant reduction in 'fugitive' dust in the area, to the benefit of the residents of Whyalla.

However, rather than take a legal approach to the problem of dust in Whyalla that could have dragged on through the courts for years without success, this government took the opportunity offered by Project Magnet to lock in real benefits for the community of Whyalla. The significant reduction in fugitive dust in Whyalla is a direct result of a concerted effort by OneSteel in consultation with the community and the state government to improve air quality.

As part of Project Magnet, OneSteel has converted the pellet plant feed to a wet slurry operation and has covered exporting facilities for iron ore handling. Both these improvements are significantly reducing the impact of dust on the local community. This remarkable environmental achievement highlights OneSteel's commitment to both the project and the community.

Over the past five months there has been, I believe, a very significant reduction in dust levels. This is a promising outcome given that the summer is traditionally the driest and, therefore, the dustiest time of the year in this part of the state. The proof of the pudding, however, will be in the longer-term monitoring of air quality. So far, the indications are that the 40-year-old red dust problem in East Whyalla is well on its way to being resolved.

Agreed community dust targets come into force from January this year, and improvements have been made as Project Magnet has come into full operation. Whyalla has also entered a new era in community engagement with the successful operation of the Environment Consultative Group and the apparent healing of the differences between OneSteel and the Whyalla Red Dust Action Group. It is important that everyone continues to foster the cooperative relationship that has begun to manifest itself in Whyalla.

To further reduce environmental impacts in the area, Operation Magnet has introduced a transhipping operation that eliminates the need for major dredging of the Whyalla port. Transhipping allows the use of large cape size vessels, which dominate the international iron ore trade, to load from Whyalla.

Importantly for this state, this project demonstrates that large-scale manufacturing and mining operations can and should be implemented to provide necessary economic growth, but in ways that minimise the impact on the environment. The big news for Whyalla is that not only are jobs and prosperity strengthened for the next 20 years but also better environmental conditions (and, therefore, improved living conditions for all Whyalla residents) have been achieved as a direct consequence of the investment by OneSteel.

This government is absolutely committed to providing the certainty and support that allows business to invest in the kinds of projects that bring major economic benefits to the state and its people. This government has provided such support and regulatory certainty through amendments to the indenture legislation to allow companies such as OneSteel to confidently implement this project.

Project Magnet is undeniably great for this state and a major boost for Whyalla. The expansion of the operations has brought a range of employment and economic development opportunities to the Upper Spencer Gulf. These include 150 apprentices for OneSteel's operations and the resumption of the engineering cadetship program and an engineering degree course in Whyalla.

OneSteel will continue to invest in the future by implementing apprenticeship, cadet and graduate programs to ensure a skilled workforce. This sort of on-the-job training in a key industry is critical at this time when South Australia and the nation are both crying out for a skilled workforce. Project Magnet is playing a major role in providing a sustainable and competitive steelworks business. That is good news for the people of Whyalla and it is good news for the people of South Australia.

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