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Legislative Council - Fifty-First Parliament, Third Session (51-3)
2009-11-19 Daily Xml
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MINERAL EXPLORATION

The Hon. B.V. FINNIGAN (14:46): My question is to the Minister for Mineral Resources Development. Will he provide details of recent achievements within South Australia's mineral resources sector?

The Hon. P. HOLLOWAY (Minister for Mineral Resources Development, Minister for Urban Development and Planning, Minister for Small Business) (14:46): I thank the honourable member for his question. In fact, I can—

Members interjecting:

The Hon. P. HOLLOWAY: Today is a very significant day: a number of very important announcements were made in relation to the minerals sector within this state, but I just do not have enough time to cover them all. However, I can provide some very good news in relation to developments within South Australia's mineral resources sector.

The Hon. J.S.L. Dawkins interjecting:

The Hon. P. HOLLOWAY: Yes, it might just be enough. Several companies today have made announcements to the financial markets that should boost the confidence of all South Australians in the prospects for our mining sector. They also again highlight the success of the government's PACE program, which has created the support and certainty investors need to commit vast sums of money to long-term projects within this state.

The first good news, in a day of good news, is that Iluka Resources has achieved first production of heavy mineral concentrate from its Jacinth-Ambrosia project in the Eucla Basin. The five years taken from discovery to production at Jacinth-Ambrosia have been an extraordinary effort by Iluka Resources. Its Jacinth-Ambrosia project has been completed ahead of time and ahead of budget, with capital spending expected to be less than $390 million, compared with an approved budget of $420 million.

This landmark in the project's development hopefully marks the beginning of a pipeline of potential new mining projects for the Far West Coast region. Iluka Resources expects that Jacinth-Ambrosia production will begin to replace output from the company's Western Australian operations, which was reduced materially in 2009.

I join the company in acknowledging the support of Primary Industries and Resources SA, the Department for Environment and Heritage, the Department for Transport, Energy and Infrastructure and the local community. This combined support has enabled Iluka Resources to develop this project in such a near record time frame for mineral developments within South Australia. This milestone was achieved while still subjecting the project to comprehensive environmental management planning controls and carrying out extensive community consultation, including a native title agreement with the Far West Coast people.

Iluka Resources discovered the Jacinth and Ambrosia mineral sands deposits in 2004. The unique characteristic of Jacinth and Ambrosia is its combination of size and high zircon assemblage, making it the richest known zircon deposit in the world. About 250 new jobs are being created in the initial construction stage of the Jacinth-Ambrosia mine, while 110 full-time jobs are expected during the 10 to 15 year life of the project.

I also bring honourable members' attention to the signing today of the joint venture agreement between AIM-listed Altona Energy and CNOOC (China National Offshore Oil Corporation) to develop energy resources in South Australia's Arckaringa Basin. One of the joint venturers, CNOOC New Energy Investment, is a unit of the China National Offshore Oil Corporation, one of China's three major oil producers.

I recently met with senior CNOOC officials in Beijing, who outlined the prospects for the South Australian project, including the development of coal to liquid and carbon capture and storage technologies.

This was part of a recent trip to China in which Primary Industries and Resources SA and the Department for Trade and Economic Development led a team to reinforce the potential world-class ore bodies and the diversity of resources. As I told the company officials in China, including representatives from CNOOC, the South Australian government welcomes foreign investment in its energy and mineral resources sector to commercialise this state's huge potential.

Primary Industries and Resources SA will be working closely with the joint venture partners to assist them to negotiate the regulatory requirements for the Arckaringa Basin project. Several companies have been looking at the potential of South Australia's Arckaringa Basin and the opportunities to develop coal to liquid and coal gasification projects. The decision by the Altona Energy and CNOOC joint venturers to carry out studies on the potential to commercialise the vast energy resources in the basin again highlights the atmosphere of certainty for investment created by the Rann Labor government.

London-listed Altona Resources earlier this year announced an £11 million share placement agreement with Tongjiang International Energy Co. Ltd, a Hong Kong based investment company. This fundraising is being used to complete a bankable feasibility study for the proposed development of a 10 million barrel a year coal to liquids plant and a 560 megawatt co-power generation plant.

The joint venture between CNOOC Energy and Altona Energy signed today establishes a long-term cooperative commitment to develop a coal to liquid and power co-generation project in South Australia. In yet another statement to the Stock Exchange today, Beach Petroleum Limited has signed a memorandum of understanding with Rentech Incorporated, a US based synthetic fuel technology company. This is a first step in relation to the commercialisation of Beach's large Cooper Basin gas resources. Under the memorandum of understanding, Beach Petroleum and Rentech will investigate opportunities for the collaborative development and commercialisation of Beach's unconventional Cooper Basin gas and petroleum liquids resources.

The final piece of good news I would like to share with honourable members is the announcement today by Iron Road of results of core testing at its central Eyre Peninsula iron ore project. Iron Road Managing Director, Andrew Stock, says the central Eyre iron project hosts a very large and very coarse magnetite iron ore deposit that may be readily upgraded to produce a range of quality products. The company believes that test results put it in a position to continue to capitalise on the continued strength in the iron ore market and the strong and growing investment interest in the South Australian iron ore sector.

Iron Road is one of a number of companies now active on Eyre Peninsula seeking to develop iron ore resources. These projects are helping this state to emerge as an alternative supply of resources to the major producers such as BHP, Rio Tinto and Vale. South Australia is establishing itself as a competitive and reliable supplier of a wide range of resources, including iron ore. So, today's announcements—all four of them—should dispel forever suggestions that South Australia's mining boom is a mirage in the desert.

Day after day, week after week, mining and energy companies are informing their investors and shareholders of real progress in exploring for and developing our state's world class resources. This state is attracting investment, which is creating jobs and exports that will only continue to strengthen the local economy and provide long-term prosperity for all South Australians.

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