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Legislative Council - Fifty-Second Parliament, First Session (52-1)
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ROXBY DOWNS (INDENTURE RATIFICATION) (AMENDMENT OF INDENTURE) AMENDMENT BILL

Committee Stage

In committee (resumed).

The Hon. M. PARNELL: Thank you, Mr Chairman; it is always good to have primary school students in the gallery, because it reminds us that the project we are talking about will be going into their adulthood long after the rest of us are long buried in our graves. The minister's answer is that she is uncertain as to whether it was capital expenditure or maintenance. My understanding is that, whilst I have no doubt that there has been maintenance, there has been very little capital expenditure, so that means that the company's number one reason for not getting out of the Great Artesian Basin is other than that of expenditure. The real reason is that it is cheaper water.

However, one of the things that the Western Mining Corporation used to trumpet as part of their obligation to the community, their social licence to operate, was the capping of other free-flowing bores out of the Great Artesian Basin. Can the minister tell us what activities BHP Billiton has undertaken in relation to the capping of free-flowing bores since it took over the operations? We certainly have some record of what Western Mining Corporation might have done, but has BHP Billiton continued that program?

The Hon. G.E. GAGO: I am advised that BHP Billiton (formerly Western Mining Corporation) contributed $1.2 million—$400,000 in 2000-01, 2001-02 and 2002-03—to phase 1 of the Great Artesian Basin Sustainability Initiative which was subsequently matched by the commonwealth government. Prior to continuing to the GABSI phase 1, BHP Billiton (WMC) actively undertook bore drain replacement on Clayton and Muloorina pastoral leases and overlapped the company's wellfield B designated area in the GAB, the main wellfield used for extraction of groundwater by BHP Billiton for the mine. BHP Billiton has also reduced extractions from the GAB through its purchase of the Etadunna pastoral lease and the paddock in which the Jackboot Bore used for the GAB well monitoring role is located in Muloorina. I am told over $2.2 million has been spent.

The Hon. M. PARNELL: Just to clarify: the minister's response is that, since taking over in 2005, BHP Billiton have bought some pastoral leases but they have not actually spent any money (or any significant money) on protecting the Great Artesian Basin through the capping of flowing bores, for example, since that date.

The Hon. G.E. GAGO: I have been advised that, no, that is incorrect. They have spent over $1 million on bores, on capping outlets.

The Hon. M. PARNELL: So the record shows that, given the size of this project, of the 42 million litres per day that they are able to take, they have spent $1 million in the last six years capping bores. I just make the observation that that is an absolute pittance compared to the task that is ahead of us. Really, I think what has come out of the minister's answers so far is that BHP Billiton are continuing to extract from the Great Artesian Basin, firstly, because the government is letting them; secondly, because it is cheaper for them to do so; and really it boils down to just those two things. But if I am wrong, I will let the government correct me. Did the government ask BHP Billiton to undertake any economic analysis, any feasibility, of comparing the cost of desalinated water with the cost of extracting fossil water from the Great Artesian Basin? Does that economic analysis exist?

The Hon. G.E. GAGO: I am advised that, no, the government did not request that information but BHP Billiton did look at a range of options and brought this back to us as the best option to meet their needs.

The Hon. M. PARNELL: Can the minister confirm that this entitlement to take 42 million litres of water a day can, under this indenture, continue up until the year 2082 or potentially even longer?

The Hon. G.E. GAGO: I am advised that, potentially, yes.

The Hon. M. PARNELL: One aspect of this that has received some attention is the fact that the government is proposing to charge BHP Billiton for the water that they extract from the Great Artesian Basin, and this will be the first time that they have had to pay for that water. However, the charging requirement has been capped and the capping, as I understand it, is at about a level of three times the initial price for the water. Firstly, can the minister explain why is that cap in place? Why won't BHP Billiton be required to pay the prevailing price for water if it exceeds the cap? Secondly, could that cap continue until the year 2082?

The Hon. G.E. GAGO: In terms of the first part of the question, I am advised that has simply been part of negotiations and that is what has been agreed to. For the second part, I have been advised that it will last for 30 years.

The Hon. M. PARNELL: So, the cap is what was agreed to. Is there any other user of water—groundwater, surface water or any water—in South Australia that has the price for water capped for the period of 30 years?

The Hon. G.E. GAGO: Not that we are aware of.

The Hon. M. PARNELL: I thank the minister for her answer, which really just shows how unique and favourable this arrangement is. No-one else—no other user of water, no irrigators, no other mining companies—gets this concession. Members are aware that BHP Billiton had their AGM last week in Melbourne, and one person managed to ask a question of Jacques Nasser, the BHP chairman. The woman, Anne Kennedy asked a question about getting out of the Great Artesian Basin, effectively saying that if BHP Billiton wanted to keep their social licence to operate they should get out of using this ancient fossil water.

Whilst I was not at the meeting, not being a shareholder, Mr Chairman—it might surprise you—apparently she received a round of applause. The chair of BHP gave her a private meeting afterwards and, as I understand it, an undertaking to investigate her assertions around the damage that the extracted water was causing on the environment. My question of the government is: notwithstanding that they have allowed the 42 million litres to continue for decades to come, will the government be working with BHP Billiton to progressively wean them off the basin?

The Hon. G.E. GAGO: I have been advised, no, and that is because the water allocation from the Far North Prescribed Wells Area, issued by the SA Arid Lands Natural Resources Management Board in February 2009, says that at least 350 megalitres per day of water can be sustainably extracted from the SA section of the GAB, and BHP's allocation is capped well within that range.

The Hon. M. PARNELL: The minister said in one of her earlier answers that there was no adverse impact on the mound springs. By mound springs we are talking about those unique environments where the Great Artesian Basin meets the surface, and they are effectively oases in the desert. The minister said that this extraction of groundwater would have no effect. She referred to the fact that they will be spreading the load by having the well fields spaced apart. Can the minister first of all confirm that, over the history of this mine, mound springs have been negatively impacted and continue to be negatively impacted? In fact, my understanding is that it least one or two of those mound springs are only maintained artificially by additional pumping of water.

The Hon. G.E. GAGO: I think I have already put this on record, that after 25 years of operation there are no impacts on sensitive receptors in the environment that are in excess of those considered and approved in the earlier state and federal environmental impact statements of 1982 and 1997. Also, the condition of the mounds springs is reported annually, so that information is on the public record.

The Hon. M. PARNELL: I thank the minister. What I was expecting her to answer was to say, yes, mound springs threatened ecological communities, under commonwealth law, have gone extinct and others are under pressure as a result of this extraction. The minister said that one reason the government is not proposing to force BHP Billiton out of the Great Artesian Basin is because there is a water allocation plan that indicates that 350 million litres per day is appropriate. BHP Billiton is only taking 42, therefore it is within the limits. My question of the minister is: if things were to change and the water allocation plan was to reflect a much lower maximum extractive use from the basin, and if other users of the basin cumulatively have met the maximum take from the Great Artesian Basin, will BHP Billiton be obliged to cut its take or will it be protected by this indenture and all other water users would have to reduce their take but not BHP Billiton?

The Hon. G.E. GAGO: I have been advised that, yes, there are powers for the minister to intervene if there is some adverse event that occurs to the GAB, or continued deterioration of some form. Section 13(8)B(c)(ii) provides:

If the Water Minister has reason to believe that the continued abstraction of water by the Company from the designated area shall be detrimental to the water resource or that there is a reasonable possibility of a complete or partial failure of the water supply from the water resource, he may issue to the Company a notice requiring it to restrict the abstraction of water from the designated area to the limit set out in the notice...

And it goes on.

The Hon. M. PARNELL: I thank the minister for her answer. As I understand it, she is effectively saying that other parts of clause 13 are of no effect. For example, we have subclauses (25) and (29) of clause 13, which basically state that the right of the company to take water takes precedence over water plans set out in the Natural Resources Management Act. Subclause(29) provides:

The Company may take water, pursuant to a Special Water Licence, contrary to the provisions of any water plan that applies in relation to the water taken pursuant to that Special Water Licence.

Subclause (8A) provides that, notwithstanding any other provision in this indenture or requirement of an environmental management program, the company shall be entitled to draw water. So, if the minister could clarify her answer: is she saying that those clauses that basically state that the company's rights prevail over any water allocation plan are not effective if the minister personally intervenes to insist that they take less water?

The Hon. G.E. GAGO: I have been advised that, in fact, the indenture does override the water allocation plans (WAP), but not the minister's powers to issue a notice as read out in my previous answer.

The Hon. M. PARNELL: I have a final question on this point. If the minister was minded to reduce the company's entitlement to use Great Artesian Basin water, would there be any claim on the company's part for compensation?

The Hon. G.E. GAGO: I am advised no.

The Hon. M. PARNELL: Unless other members have questions on clause 13, I might just outline that, when we get to my schedule 2, I do have a number of amendments that relate both to the desalination plant and to the Great Artesian Basin. My amendments require the company to do what the Environment, Resources and Development Committee asked it to do, that is, to find a better spot for its desalination plant that is not in Upper Spencer Gulf.

I have amendments here that impose a 10-year sunset clause on the extraction of groundwater. I have a sunset clause to phase the company out of using water from Borefield A, and Borefield A (the original borefield) is the one that did result in the extinction of Mound Springs and the harm to a number of others; and, in fact, an acknowledgment of that fact is why the company and its predecessor actually reduced their take from that well field and transferred most of it to Borefield B.

There is a number of amendments and we will get to those later. Clearly, this is a pretty significant part of the project, and I thank the minister for her answers. Unless other members have questions, I propose to move on to clauses 14 through to 18, which I am happy to deal with en bloc because my questions are the same for all those.

Clause 14 relates to roads; clause 14A the workers' village infrastructure; clause 15 is airport and related facilities; clause 16 is railway facilities; clause 17, port facilities; and clause 18, power facilities. These are infrastructure. What they all have in common is bargain basement rental, being $1 per year for each piece of infrastructure. Can the government explain why that sum was chosen for what will in effect be many hundreds of square kilometres of South Australia?

The Hon. G.E. GAGO: I want to advise members that the rental for expanded SML will be around $2.5 million per annum, and the desal plant will be paid at full market rates. If all the matters that the honourable member brought to our attention—the road, airport, railway, etc.—were added up and put under a standard lease, the total cost would come to $19,715 per year. So it is a pittance amount and, considering the other leasing arrangements which are clearly going to be far more advantageous, we are unlikely to worry about the $19,715.

The Hon. M. PARNELL: I thank the minister for her answer and I accept that is a very small amount in the overall scheme of things. Is the minister's answer predicated on what the rental for those facilities would be—the railway, easements, port, power easements? Is that the rental the minister believes would have been payable had the Valuer-General determined the rental? In other words, on what basis is that $19,000 determined, given that each of these, it says in the indenture, is $1 per year rental?

The Hon. G.E. GAGO: I have been advised that these are the rates that would stand under any standard mining leasing schedule. This is what would occur if another mine wanted to lease these.

The Hon. M. PARNELL: I understand that the minister is saying it is the going rate, but is that the going rate determined on the basis of the information the Valuer-General would provide, or is it just made up?

The Hon. G.E. GAGO: It is what we offer the mining industry generally.

The Hon. M. PARNELL: The reason that is important, Mr Chairman, is that a part of all of these clauses is an effective right to the exclusive occupation of these areas of land and the infrastructure. Whilst members might be minded to think that if BHP Billiton is going to build a railway or a transmission line or a port, that is theirs and they should be entitled to do with it as they will, members would also appreciate that in Australia we have third-party access arrangements which are designed to make our economy more efficient. It makes absolutely no sense to have two parallel railway lines running alongside each other or two parallel sets of power infrastructure or to have two shipping ports side by side if, in fact, there is capacity in that infrastructure for third parties to have access.

I am sure all members have read it, but I draw to their attention a statement by the new chair of the ACCC Mr Rod Sims in the media last week speaking about this issue and he took the opportunity in one of his first important speeches to basically say how broken the system of third-party access is. He pointed out that what is called the part 3A access provisions effectively do not work and they allow companies, including mining companies, to monopolise the infrastructure and use legal techniques to prevent their rivals getting access to it, even if there is clearly excess capacity.

Mr Sims points out, for example, that probably the two best known access cases are Fortescue's seven-year battle to get its trains onto the Pilbara networks, run separately by Rio Tinto and BHP Billiton and, apparently, the more straightforward attempt by Virgin Blue to get access to services at Sydney airport. Mr Sims is not the only one who has pointed out how difficult it can be, yet in this indenture we find the government writing in provisions which effectively protect, or attempt to protect, BHP Billiton from having to share its infrastructure even if there is capacity and even if these third parties are able to pay commercial rates for access. First, why on earth did the minister agree to that; and, secondly, does the minister believe that these protections will be effective?

The Hon. G.E. GAGO: I have been advised that BHP obviously wanted certainty around its ability to be able to run and manage its own infrastructure. However, it is not immune from federal third-party access regimes and it has demonstrated that it would be prepared to lease on a commercial basis.

The Hon. M. PARNELL: I understand that the minister's answer is that, where third-party access regimes are governed under commonwealth provisions that the company accepts, it will have to comply with those provisions. However, my question of the minister was: does she believe that any of these protections from third-party access will be effective? I guess the context of my question is that it was clear in the debate in the other place that this was a die-in-the-ditch issue for the company; that is, it absolutely insisted that it had to have protection so it did not have to share its infrastructure assets with anyone else. I will ask the minister again: which parts of infrastructure is the company resigned to having to share and which parts does it believe the indenture protects it from having to share?

The Hon. G.E. GAGO: Clearly, this was an issue that was of great concern to BHP. It is investing huge amounts of money in the development and maintenance of its infrastructure, and it clearly wanted to have certainty over the running and management of that. In relation to state access, it involves rail and water and the rest is federal, I have been advised.

The Hon. M. PARNELL: I thank the minister. I guess it is a big disappointment to me that as a nation we have tried to come up with rules and systems for the more efficient operation of our economy and the sharing of infrastructure that is capable of being shared, yet what the government is doing here is deliberately undermining that national policy to provide protection to this company for their expenditure.

So, when it comes to things like railways, whether you are running one train a day or 10 trains a day, if there is a capacity for any other trains and any other mine sets up anywhere in the area where it would be more efficient for them to connect to the BHP line and pay BHP a fair commercial return for the use of their line, then the effect of this indenture is to say that that will not happen or that the third parties cannot force it to happen, to be more accurate. Of course, BHP could set their own price—they could set an exorbitant price—and they could hold these other companies over a barrel. So, you may end up getting two railway lines built side by side, and that would be a commercial decision that gave BHP the ability to force a rival to do that, and maybe kill off their project, and maybe kill off competition.

I am amazed that the government has gone down this path, but I will not pursue that any further, other than to point out that these clauses are probably some of the most contrary to the public interest in this indenture. The amendments that I am moving (when we get to them) are: first of all, I want the one dollar per year rental for all of the sites for this infrastructure to be set by the Valuer-General. I have also included third party access clauses in relation to the airport, the railway, the port and the power facilities. I have not included things like pipelines. If you have a pipeline that is full of someone's water, well, it is pretty difficult to share that if it is at capacity. The same would apply to any of these pieces of infrastructure which were at capacity and where the company required exclusive 100 per cent use but, clearly, on any analysis, most of these bits of infrastructure will not be used to their full capacity.

So, those amendments are before us when we get to that. They are my questions on clauses 14 to 18. Unless other members have contributions, my next clause is 19, which relates to the special mining lease, and I particularly want to focus on subclause 2(b) which talks about the expected life of the mine. The indenture that we are being asked to approve—this project—is based on a nominal life of 40 years. That was the period that was set out in the EIS, yet many of the public statements by government ministers and by the company itself are talking about a project that will go for twice as long. There is also an expectation in this indenture and elsewhere that the total capacity of the mine could be up to double the 750,000 tonnes that are being approved. My question of the government is, is the government already talking to the government about expanding beyond 750,000 tonnes?

The Hon. G.E. GAGO: There is certainly no secret in BHP making it clear that the indenture contemplates 1.5 million tonnes, however, anything greater than 750,000 tonnes requires a new EIS.

The Hon. M. PARNELL: The logical follow-up question is, if it has been no secret, and the company is talking about it, and the government is talking about it, why did the government not require BHP in relation to some of the environmental impacts—I do not suggest it would be all of them, but some of them where a key factor might be time—why did the government not insist on BHP analysing the cumulative environmental impacts for, say, a 100-year project, rather than simply a 40-year project?

The Hon. G.E. GAGO: We decided to do it in a staged approach. That is a more manageable way to do it.

The Hon. M. PARNELL: I completely understand the staged approach, but the point that I am making is that everyone—the company, the government, in the community, everyone—is talking about a much bigger project and, yet, we are being asked to effectively give endorsement to this project knowing that it is going to expand, or is likely to expand, or has permission to expand, without having a look at those cumulative impacts. I will leave that line of questioning there. I have some amendments modifying clause 19 which members can see when we get to schedule 2. Most of those are consequential and they are issues that I have raised already.

In relation to clause 19A—Pipeline licence, I have some amendments there, including deleting reference to the euphemistically described non-discrimination clause, which basically says that tougher standards should not be imposed on BHP Billiton; in fact, even tougher standards that might universally be applied should not be applicable to BHP Billiton if, in BHP Billiton's opinion, it is going to unfairly affect it.

In relation to clause 21, in relation to infrastructure, the mining minister, Tom Koutsantonis, on radio, has linked a number of developments in the north of the state and suggested that they are, in fact, linked. On regional radio, for example, on 10 October, he said:

There is so much going on in and around the north of the state that there is a common user facility being proposed at Port Bonython by Flinders Ports. We're hoping that [transcript unclear] $1 million port will get the kick along now with this announcement.

By 'with this announcement' he was talking about the BHP Billiton announcement. So, my question is: what link is there between the proposal for a deep-sea port at Port Bonython and the Olympic Dam expansion?

The Hon. G.E. GAGO: There is no current link.

The Hon. M. PARNELL: Is the minister categorically ruling out that any ore or finished product from Olympic Dam will be exported via a yet to be constructed facility at Port Bonython?

The Hon. G.E. GAGO: That would be a matter that would be looked at by BHP as a commercial consideration.

The Hon. M. PARNELL: So, the answer is that, if BHP Billiton thinks that it is the cheapest way in which to get its product out, it will use the port facilities at Port Bonython? The minister's shrug/nod indicates that that is certainly a possibility.

My next clause is 24 and, if other members have clauses in-between I will sit down, otherwise, in relation to clause 24—Freehold grants, I do not have any questions but I point out that I do have amendments, which effectively will remove this capacity to freehold what is currently publicly owned land.

The next clause is 27—Leases, licences, easements and rights of way. Again, I have an amendment there, which is consequential on the deletion of clause 31, which we will get to. In clause 28, I have an amendment, which basically is in relation to the modification of state law over major projects which, under the current clause 28, gives special concessions to BHP Billiton. I am proposing to delete that clause.

Clause 30 I am proposing be deleted. This is a clause where the state agrees never to resume or compulsorily acquire land that is required by the company, but I note that the very next clause, in fact, obliges the state to resume land if the company does need it. Under clause 31, the compulsory acquisition powers can be used for the benefit of BHP Billiton but they cannot be used against BHP Billiton.

So, again, these are special arrangements that apply to this company and to no other. There are amendments to clauses 30, 30A, 31 and 31A, which brings me to the next substantial clause. I am sure other members will have a contribution on this as well; clause 32 is in relation to royalties.

The CHAIR: I remind the cameramen that they should film only the people on their feet. Did you get the message up there? The fellow up the back in a white shirt: you can film only those people on their feet.

There being a disturbance in the Strangers' Gallery:

The CHAIR: I am talking to the camera guy. You should sit down and be quiet.

There being a disturbance in the Strangers' Gallery:

The CHAIR: Sit down and be quiet. I remind you that you can film only those people on their feet. The Hon. Mr Parnell.

The Hon. M. PARNELL: Clause 32 relates to royalties and, as a constituent wrote to me in an email this week, 'It's our land, it's our resource; we should all benefit, not just BHP shareholders.' So clearly, the royalty rate is of some concern to the community. Why was the royalty rate locked into a period of 45 years? The flipside of that question is: why not insist that BHP Billiton be subject to the royalty rate that prevails from time to time, as all other mining companies in South Australia have to be?

The Hon. G.E. GAGO: I have been advised that 45 years was the time period that was agreed to, and it was agreed to because BHPB needed certainty in terms of both the rate and the time. The 45 years was part of the negotiated agreement. As you would be aware, the same mining rate applies to them as applies to other mining interests of a similar type.

The Hon. M. PARNELL: The Hon. David Ridgway is keen to contribute as well, but I would like to pursue this just a little bit further. I understand they want certainty—every mining company would like certainty, every mining company would love their cost structure to be locked in for as long a period—but why 45 years? The EIS is for 40 years; if you are going to lock it in, why not lock it in for 20 years or 50 years or 100 years? Why was 45 years chosen? It appears to be a number plucked out of the air that bears no relationship to any of the time periods attached to approvals under the indenture.

The Hon. G.E. GAGO: The time period was agreed to; negotiations took place and certainty was needed. The 45 years was the period that was landed on. BHP believed that this was adequate to provide them with the certainty, both in terms of rate and time, that they needed. In terms of comparisons with other mining investments, there is no comparison; there is no other mine interest agreeing to invest in South Australia somewhere in the vicinity of $30 billion. This is quite an exceptional set of circumstances that required special consideration in relation to their needs, given the extent of that investment.

The Hon. M. PARNELL: To pursue that, certainly the company and other ministers have said that there is a long lead time with this investment; it will take them a long time before they start to make a profit. In fact, we have had three different figures given recently. Deutsche Bank's mining analyst Paul Young, for example, said in the Australian Financial Review, 'It will take 15 years before you end up paying back your capital.' Ex-minister Kevin Foley, in the other place, said on 9 November (using not quite the same turn of phrase) 'these buggers ain't going to make a profit for 18 years'. Then we have Treasurer Jack Snelling saying in The Advertiser on 26 October, 'It does make the project, on paper at least, marginal when you think it'll take 20 to 25 years before they've recovered their initial capital outlay.'

My question to the minister is which of those three is correct: Deutsche Bank, 15 years; ex-minister Foley, 18 years; or Treasurer Jack Snelling, 20 to 25 years? A supplementary question is: ought not an analysis of the payback of capital have affected the length of time that the royalty freeze was in place?

The Hon. G.E. GAGO: I am advised that those payback times are dependant on a wide range of different variables, so the thing can shift and move. So, it just depends.

The Hon. D.W. RIDGWAY: Questions have been asked around the 45-year time frame for the level of royalties. We have been repeatedly told by former minister Foley, former premier Rann, Premier Weatherill and minister Koutsantonis that this is a very good deal. Could the minister share with the chamber, if this is the negotiated point of 45 years, where did the government start its bargaining from? How much ground have we had to give in order for this deal to be achieved?

The Hon. G.E. GAGO: Negotiations are a confidential set of discussions, so it would be most inappropriate for me to be talking about any detail. Obviously a wide range of different matters were considered until a final position was then landed upon, as I said, on a wide range of different matters.

The Hon. D.W. RIDGWAY: So the community just has to believe those people I mentioned—the former minister and premier, the current minister and Premier—and yourself, minister, that this is the best deal that we could possibly have got; 'Just trust us'?

The Hon. G.E. GAGO: I can assure honourable members that this government believes that this is the very best deal that could have been extracted. One matter that I am able to share is that, for instance, BHP Billiton wanted a period of 70 years and we were able to bring that back to 45 years. As I said, there is a high degree of argy-bargy that goes on, and we believe we have extracted, overall, the very best deal for South Australia.

The Hon. D.W. RIDGWAY: The answer to the previous question was that it was confidential and you could not share any information. You have now just shared with the chamber that BHP's position was 70 years. So, you are quite happy to share their part of the confidential information, but it appears you are not prepared to share the taxpayers' share of the confidential information.

The Hon. M. PARNELL: I don't think the minister is proposing to answer that, so I will jump up, unless you want to pursue it.

The Hon. D.W. RIDGWAY: I will place on the record that maybe we should ask BHP if they would like to share the government's portion of the confidential information so that then at least both sides have an opportunity to put their case.

The Hon. M. PARNELL: I think the Hon. David Ridgway makes some very good points. It is interesting to know that BHP asked for 70 years. The EIS might have been for 40 years, but the economic modelling in the EIS was only for 30 years. So, we have economic modelling for 30—

The Hon. D.W. Ridgway interjecting:

The Hon. M. PARNELL: But they are not cumulative. Members would recall—because I have referred to it before and a number of members have read it—the damning critique that was in The Australian a week or so ago. Paul Cleary said:

Rann and his administration should know full well that these royalties fail to capture a fair share of mining profits. This has been in the economic literature since the 1970s and was made more prominent by the Henry review. Yet the deal does not contain a single element of profits-based taxation.

The article goes on:

Given that this is an agreement negotiated in the 21st century, it beggars belief the state could have agreed to a regime based exclusively on production-based royalties that hark back to medieval times.

Why was a profit-based royalty regime not considered?

The Hon. G.E. GAGO: I have been advised that it was considered but if we went to a profit-based royalty system we would not see any royalties for approximately 15 years and it would also have a detrimental effect on our horizontal fiscal equalisation arrangements.

The Hon. M. PARNELL: I guess one of the things to take out of that answer is that in answer to my earlier question, who was right, Deutsche Bank was right—15 years before you start making a profit. In terms of the vertical fiscal equalisation process, whereby all states effectively pool their royalties and they are shared out by proportion of population, that actually was my next question. Whilst we are talking about locking in the royalty rate for 45 years for this one company and this one project, are we not effectively locking in the national royalty for that period of time?

Members might think that is a curious question—we are not legislating for the nation, we are only legislating for South Australia—yet, in the other place, the Hon. Kevin Foley said:

We will be producing—I do not know—80 per cent of the nation's copper. We will be producing 90 per cent of the nation's uranium. We will be the price-setters of royalties. Western Australia is not going to put a royalty rate higher than us: why would they be that stupid?

Has this government, by this agreement, locking in a 45-year royalty rate, effectively tied the hands of all other state governments when it comes to setting royalty rates for their mining projects?

The Hon. G.E. GAGO: I have been advised no, that they are entitled to set and able to set their rates at whatever they like.

The Hon. M. PARNELL: Of course, that is right; they can do it. Former minister Foley said that they would be stupid to do it. As a follow-up question: has the government done any analysis of the impact of its decision to lock this royalty rate in for 45 years on the potential nationwide collection of royalties as other states find that they are effectively capped at the same rate that BHP Billiton has been capped at?

The Hon. G.E. GAGO: I have been advised no, that our priority has been focused on promoting the interests of South Australia.

The Hon. M. PARNELL: I make the observation that it is a very narrow approach. Here we have a government behind closed doors negotiating effectively on behalf of the entire nation. Another aspect of royalties that has been raised—and I have raised it in this place many times—is the idea of the investment of royalties into a sovereign wealth fund. Whilst I appreciate that there are certainly limitations presently on what the state can do, given the current equalisation arrangements, has the South Australian government been speaking to the federal government about the creation of some type of sovereign wealth fund that would preserve some of the current revenue from this Olympic Dam expansion so that the capital can be invested and future generations will still have access to effectively the benefit of these minerals that can only be dug up once?

The Hon. G.E. GAGO: I have been advised that, to this point, not that we are aware of.

The Hon. M. PARNELL: I would urge the minister to have those discussions, because if this project is as big as the government says, if it is going to be as lucrative as the government says, then we as a nation would have rocks in our head to not invest some of the proceeds for the future. I do not have any further questions on royalties. Does the Hon. David Ridgway have any further questions on royalties?

The Hon. D.W. Ridgway: No.

The Hon. M. PARNELL: I foreshadow that I have a number of amendments on the topic of royalties, basically to end the 45-year capping period to enable the company to pay the prevailing rate as it is from time to time. I have amended the clause to reduce provisions that allow for the royalty rate to be reduced in certain circumstances and also to bring in some provisions so that South Australia is not obliged to reduce its own royalties following the introduction of a commonwealth royalty or some other new commonwealth levy or tax.

My next question is in relation to clause 33. It is, in fact, not so much a question as an observation that my amendments seek to delete clause 33, which is headed 'No special taxes'. By deleting this clause, we would effectively stop the binding of government or parliament to be able to impose new taxes, rents, charges, tariffs and levies. I think that certainty is not counted in a democracy like Australia by all companies having to comply with rates of tax and laws as they exist from day to day. We do not need the special provisions.

Clause 34, the so-called non-discrimination clause I have referred to, should be deleted. It effectively says that, even if a provision does not name BHP Billiton, if they believe it is discriminatory because it applies to them more than anyone else because they are doing more of something than anyone else, it is not allowed. I think they should comply with the law of the land as it exists at the day.

Clause 35 relates to confidentiality. I will not go into a lot of detail, because we have touched on it before in relation to clause 7, where the statute book of South Australia in its entirety is to be read down to give effect to this indenture. One of the things that we have found in relation to freedom of information applications, for example, is that it is very difficult to obtain those documents because of the confidentiality provisions of the indenture.

I have an amendment which proposes to change the confidentiality regime. In fact, I will ask the minister a question about this, because the change that I have proposed is actually a change that was proposed to government some time ago and it is a change that the government has adopted in other pieces of legislation. If you look, for example, to the Bachmann review, which was conducted in August 2002, entitled 'Report of independent review of reporting procedures for the SA uranium mining industry'—and it is a report for the SA minister for mineral resources and development—there are a number of recommendations in that report. Recommendation No. 2 says:

In order to allow the release of information about incidents which may cause, or threaten to cause, serious or material environmental harm or risks to the public or employees, the Government should revise and appropriately amend the secrecy/confidentiality clauses in the legislation referred to in Appendix B. Information on individual persons should not be disclosed.

This is the Bachmann review. It said change the confidentiality and secrecy provisions. It referred to a list in appendix B. What do we find in appendix B—Roxby Downs (Indenture Ratification) Act 1982, clause 35—Confidentiality. This was a recommendation some nine years ago to delete this clause and replace it with something better. My understanding is that former mining minister Holloway did in fact repeal section 14 of the Mining Act to give effect to this recommendation.

I understand also that section 9 of the Mining and Works Inspection Act was amended to give effect to this recommendation and the substituted provision is based on section 121 of the Environment Protection Act. The amendment that I will be putting forward basically seeks to do just that; that is, remove the secrecy provision, the confidentiality clause, and replace it with the equivalent of that section in the Environment Protection Act. If it was good enough for the Mining Act, and good enough for the Mines and Works Inspection Act, why was it not good enough to modernise the confidentiality provisions in this indenture?

The Hon. G.E. GAGO: As the Hon. Mark Parnell has outlined, his proposed amendment is nearly identical to that of section 121 of the Environment Protection Act 1993 and appears to have been modelled on that section. The indenture is a legal and commercial agreement between the parties to the indenture (being the company and the state). It largely operates to confer rights and place obligations on those parties; unlike the Environment Protection Act, it is not general legislation designed to apply across the board to be entire community.

The wording of clause 35 in the bill has been agreed between the parties. The government is of the view that the wording of clause 35 in the bill is sufficient to cover all the necessary circumstances, including those contemplated in parts (a) to (d) of the proposed amendment, and I do not think I need to go through those. The government considers that such an amendment is neither appropriate nor necessary.

The Hon. M. PARNELL: I just make the observation that it is appropriate, it is necessary, and it was done in other legislation; I think this is just yet another sop to BHP Billiton. When any members find that they have difficulty extracting information about this project, they can perhaps remember today, when they had the opportunity to support more appropriate confidentiality provisions.

The next clause I refer to is clause 36—Assignment. I just make the observation that I have an amendment on file which seeks to modify this clause. We are hearing so much about BHP as good corporate citizens, yet under this indenture they would be able to assign their rights to other corporations who may not have, at least what the government believes, is the same reputation as BHP Billiton. My amendment proposes that any assignment of interests under this indenture triggers a review of the indenture itself.

My next issues are with clause 40—Commonwealth licences and consents. Clause 40(2) places obligations on the state to represent company interests to the commonwealth in relation to the grant of licences, consents, or in relation to any agreement. I think the minister has already answered a question vaguely relating to this earlier, when she said there had been at least one conversation between the relevant federal minister and the state minister, but I would just like to ask her specifically: have any representations been made so far, consistent with clause 40, by the state government on behalf of BHP Billiton to the commonwealth?

The Hon. G.E. GAGO: I have been advised not that we are aware of.

The Hon. M. PARNELL: The minister might not want to do this, but I will invite her to speculate. As we have covered before in the debate on these proceedings, currently exporting uranium-infused copper to China is not consistent with any international treaty obligations. Does the minister expect South Australia to be lobbying, if you like, the federal government to change those arrangements so that BHP Billiton is allowed to export that ore?

The Hon. G.E. GAGO: We spent quite a bit of time on this last Thursday. I have comprehensively put the government's response to that on the record, and I have nothing further to add to that.

The Hon. M. PARNELL: I am proposing to delete clause 40. The next clause is clause 42A—Rehabilitation obligations. Earlier in this debate, minister, in response to my question about the life of tailings protection, you said that you had been advised that, under the rehabilitation obligations, the standard of rehabilitation is such that the protections are extremely long term and, in effect, indefinite. I would like the minister to follow up what she said then with an assurance—in fact, I ask her, how can she make an assurance that the protections will be indefinite when the mine closure plan has not yet been finalised?

The Hon. G.E. GAGO: Again, we spent a great deal of time on and I believe I showed a great deal of latitude in relation to this last Thursday. I believe I have comprehensively addressed these issues with the best information that I had to hand, and I have nothing further to add to this.

The Hon. M. PARNELL: I will invite the minister to go a little bit further. I received an email just today from someone who has diligently been reading the Hansard—good on them. I am sure they are not alone; this is such an important project. This person says that they were looking at similar mines overseas—not necessarily similar in terms of this scale, but other large mines overseas—and looking at what rehabilitation had been undertaken. This person—an environmental consultant—has said to me:

To my knowledge, not one mining company in South Africa has closed a mine and walked away leaving the site to nature and the vagaries of time.

In other words, they have not been able to walk away. They talked about mines being abandoned in the early days in the United States and that none of those early mines has ever been closed in a formal sense and then left to nature. This persons says that in Canada:

...there are all too many terrible examples of mines, once productive [or] profitable, that are now in...perpetual care of the federal or affected provincial government. None of these mines, I venture, will ever be closed in a way that it will be possible to walk away and leave them to nature and the vagaries of time.

I once sat for three days in a luxury conference centre on the edge of the Grand Canyon as we deliberated how to walk away from the uranium mill tailings impoundments on which we eventually spent upwards of a billion dollars on closure works. We concluded that we could not walk away, ever...

He goes on:

Some of the writings coming out of Australia on mine closure are predicated on the idea that once the miners have closed the mine in accordance with set standards, the government will take responsibility for the site. This is realistic, even if unfortunate.

He concludes:

The point is...there is no such thing as walk-away closure of a mine site. Somebody, somewhere, for time eternal (at least in human terms) will have to be around to take a look and to act when things change or fail to go as hoped or predicted.

I just point out to members the Brukunga mine, which has cost far more in rehabilitation than we ever extracted from that mine in relation to ore. Whilst the minister might believe that she has done this issue to death, can she clarify that there will be public input into this mine closure plan and that the government can force BHP Billiton to remain responsible for as long as is necessary?

The Hon. G.E. GAGO: I can only reiterate that we believe we have provided the best solution for the particular circumstances before us—and I have put that on the record before—using the best science available to us. We have some of the best mining regulation in the world. It is, therefore, extremely difficult to be comparing what we do here in Australia with some other countries that do not have the same strong regulatory basis.

In relation to the inputs, I have been advised that the indenture minister is required to approve the rehab plan, so that will need to be ticked off. Again, I reiterate that we have some of the most highly developed regulation in the world around mining standards.

The Hon. M. PARNELL: I appreciate that the minister said that the relevant indenture minister will need to sign off, but just to tie this right down, will the government require this rehabilitation plan to be developed effectively now, in other words, before the mine has even been constructed, or is it something that it is proposing could take some time; and will there be an opportunity for the public to have input into that plan?

The Hon. G.E. GAGO: I am absolutely confident that the indenture minister, when making his or her decision, will elicit whatever expertise and input he or she believes is required to make the best decision possible. I have been advised that BHPB is required to have its first rehabilitation plan within two years of ratification.

The Hon. M. PARNELL: All I can take from that is that the minister has an expectation that some people whom the minister believes are worth consulting will be consulted, but she has given no commitment that members of the public will have any say over what will effectively and potentially be a toxic legacy for centuries. A specific question is in relation to clause 42A, subclause (14), which provides: 'The minister may, notwithstanding clause 35, make public the base value at any time', the base value referring to the base value of the rehabilitation security. Can the minister confirm that the minister will in fact make that available rather than leave it as optional, as it is currently worded?

The Hon. G.E. GAGO: I can reassure the honourable member that the minister may make it available.

The Hon. M. PARNELL: The question obviously then is: we are not going to be told how much money is set aside; we are not going to have any input into what is going to be required to rehabilitate the biggest hole in the ground on the face of the planet, the biggest industrial project in our state's history? I, for one, do not accept that answer, and I would urge honourable members to think likewise. I think we deserve much better than what we are seeing in this indenture, where the minister has a discretion to disclose one of the most important pieces of information in this document.

I will ask one final question, or series of questions, in relation to this. Can the minister assure us that, however long it takes and however much it costs, ultimately the company will be responsible for all of the costs in relation to closure and that it will not be allowed to walk away and hand responsibility over to the state?

The Hon. G.E. GAGO: I have been advised, yes.

The Hon. M. PARNELL: That is clause 42A. Clause 43 again provides special tax relief for the company, this time in relation to stamp duty. My proposed amendment is to delete that clause. The next clause I am interested in, unless other members have intervening questions, is clause 47—Enforcement. Under state law, under the Development Act, any person has the ability to go to the umpire and enforce obligations under that act. Under the Environment Protection Act, there is also the ability for third parties to actually go to the umpire—the Environment, Resources and Development Court—and seek orders and seek redress in relation to alleged breaches of the act.

My question of the minister is: why in relation to this project is there no provision for third-party enforcement? I have just reminded myself that it is also included in the Natural Resources Management Act as well. These major public environmental statutes all have the ability for members of the public to enforce the act; why not in this case?

The Hon. G.E. GAGO: This is in relation to your proposal to replace—

The Hon. M. Parnell: Clause 47.

The Hon. G.E. GAGO: Yes. The amendment appears to be based on a misunderstanding of what existing clause 47 aims to achieve. The indenture is a legal and commercial agreement between two parties—the state and the company. The purpose of clause 47 is to specify that enforcement of compliance with the provisions of the indenture lies with those parties and with no-one else.

This amounts to where there is a view by either party that the other party has not complied with the provisions of the indenture. It is up to the parties to resolve that under the terms contained within the indenture and bring that matter into compliance. This does not and, indeed, cannot prevent the appropriate courts having jurisdiction; nor does it seek to prevent the appropriate state and federal authorities taking actions to enforce those matters over which they have enforcement rights and responsibilities.

Enforcement matters under the indenture are spread across many areas within the indenture. For example, clause 11 deals with compliance and enforcement of the environmental management arrangements. Clause 7A, along with parts of clause 11, serves to ensure that the EPA can act with independence on matters over which it has jurisdiction under the EP Act, and the EPA has a whole enforcement regime available to it under the act.

Clause 19A contemplates a pipeline licence pursuant to the Petroleum and Geothermal Energy Act 2000, and enforcement of the provisions of the licence would fall to the regulators within the energy resources division of the department for manufacturing and innovation. Many other matters that are dealt with in the indenture are matters for which it would be entirely inappropriate to attempt to impose the sort of enforcement regime proposed in this amendment. The government's view is that enforcement is dealt with in an appropriate manner in the indenture as it is drafted in the government's bill.

The Hon. M. PARNELL: I thank the minister for her answer and I just make the point that my amendment is not based on a misunderstanding of what clause 47 is designed to achieve. I understand exactly what it is designed to achieve. It is designed to try to protect the privity of contract, if you like, between two parties—the company on the one hand and the state on the other.

If we were talking about normal contract law where you have two independent people who are negotiating to buy a car, or whatever it is, yes, you might want to make a provision that no-one else is allowed to interfere or no-one else is allowed to try to enforce that contract, but this is a contract on behalf of the people of South Australia that the parliament is now legislating to give effect to. In relation to any of these provisions, especially the ones that do seek to give some protection to the environment, if either of the parties fail to comply with their part of the agreement, then under this indenture, under the minister's proposal, it is just a matter for them. There is nothing anyone else can do about it.

The point that I am making is that the implications of things not being done in accordance with the indenture—all of these assurances that we have now had many hours of—if any of these things are not done, there is nothing anybody in South Australia can do about it unless you are the minister or unless you are BHP Billiton, and that is just wrong.

For example, the minister referred to the powers that the EPA has. We know that often government agencies need a bit of a kick along. Often they need communities behind them, agitating, pushing. I think we need to go further. I think we need to give the community the right to enforce at least those parts of this indenture that are designed to protect the public interest and protect the public environment.

My amendment here is effectively a rewriting of section 104 of the Environment Protection Act provisions which, as I have said, are mirrored in our water laws, in the Natural Resources Management Act and in the Development Act as well, so that third parties can enforce this law that we are passing today.

Clause 48—State assistance and support: I just note that I have a number of amendments to delete clauses, in particular clauses such as those requiring the state to support and sponsor the company's interests. I do not think that is appropriate. I think they can be deleted.

For example, there are consequential provisions around the exclusive use of infrastructure and the ability for BHP Billiton to be able to prevent third party access. I think they can be removed as well. Also, an important provision in relation to infrastructure is where, under this clause, the government has no ability to tell BHP to build a piece of infrastructure bigger than they need, even if the government is prepared to pay the difference in cost. I think it is similar to the infrastructure sharing that the government should be able to impose that requirement—yes, pay a proportion of the cost necessitated by any public component of that infrastructure. So, removing subclause (4) from clause 48 would at least keep the door open for the state to be able to insist that infrastructure be planned to meet not just the company's requirements but the community's requirements as well.

As to clause 49, I will make some observations. I have two main concerns with this clause. I have touched on them before. The indenture proposes that there be an arbitration provision rather than allowing the umpire to make the decision. Part of the problem of that, of course, is that the arbitrator need not be a judicial officer, need not be bound by the same principles of law that our judicial officers are bound by in South Australia.

Secondly, the arbitrator is effectively required to take into account a range of private interests that will supersede public interests. For example, if an environmental matter was to go for decision to the Environment, Resources and Development Court, then that court would be required first and foremost to have regard to the objects of the act, to have regard to the principles of environment protection set out in the act, but under this arbitration clause the prime consideration is the indenture, the commercial considerations and the rights of the company.

The amendment that I have put forward basically establishes the ERD Court as the sole arbiter, and members might think that is too heavy-handed but I point out that under the ERD Court Act all disputes have to go to a roundtable discussion first, the section 16 conference. So, it is not as if that court is simply an all or nothing fistfight; there is the ability for conciliation and negotiation to come up with an outcome. I think that court should be the arbiter. Of course, that court will be open to the public. The arbitration will be private. I think they are a number of very good reasons why we should reject clause 49 as it is and support my amendment which puts the environment court in charge.

Secondly, my amendment requires that with the court as the arbitrator that the court will have regard to the objects and other decision-making criteria of the various acts that would normally cover the dispute in question as well as the objectives of the project. It is not ignoring the fact that the project has objectives but I want to make sure that the statutes of South Australia, the purposes behind all those acts, the objects of those acts, will be taken into account when the court makes its binding determinations. In relation to matters concerning the environment, I have added the additional requirement that, as well as taking into account the objects of the act, they should also take into account any relevant environment protection policies. I simply make that point. That is the reason behind my clause 49.

As to clause 52, this is a clause that allows for extensions of time, and I will ask the minister a question in relation to this clause, and that is: how much faith can we have in the various time limits that are set out in this indenture if every single one of them is subject to variation under clause 53?

The Hon. G.E. GAGO: The clause provides for the minister, at BHPB's request, to extend any period or postpone any date referred to it in the indenture as the minister thinks fit. The minister's decision is not arbitrable. This right was provided in the 1982 indenture, and as part of the indenture arrangements negotiated in 2011 it was agreed that the clause be retained.

The Hon. M. PARNELL: I thank the minister for her answer. It just clarifies what was inherent in my question, which is that there are no timelines that we can be confident of because the minister has the ability to change them and the changing of timelines is not subject to arbitration, so, I think that stands as it is.

The only other amendments that I have to the indenture are some consequential amendments in relation to the schedules to the indenture. The schedule is to the indenture itself. The other final component of my amendment No. 27, which is this omnibus amendment, is the insertion of a new schedule 3, which is an amendment of the Radiation Protection and Control Act, which was an issue that we canvassed in some detail on Thursday. It is basically a mistake, as I see it, in this legislation. I am seeking to correct the mistake, and then I am seeking to throw the whole thing out, because we do have these special provisions in the Radiation Protection and Control Act, which are currently expressed to apply to the joint venturers.

Joint venturers do not exist anymore, that has been deleted from the bill, but I think that, regardless of the schedule, the exemptions need to be deleted as well. With that, that is my contribution to my amendment No. 27, which is most of the things that the Greens believe are wrong and how we would be fixing the indenture to be in the best interests of the people of South Australia.

The Hon. G.E. GAGO: At this point I would like to clarify the record in relation to a desal question about chemicals in the brine. My previous comments about chemicals in the desal plant discharge should have made it clear that not all chemicals will be removed prior to discharge, but that the EPA licence conditions to prevent serious environmental harm will take into account any residual chemicals and will base its licence conditions on ecotoxicity testing that includes the assessment of those chemicals. This approach is consistent with the regulation of other desalination plants.

The committee divided on the schedule:

There being a disturbance in the Strangers' Gallery:

The CHAIR: Sit down and be quiet. Order! The cameraman shouldn't be filming that. Security!

AYES (18)
Bressington, A. Brokenshire, R.L. Darley, J.A.
Dawkins, J.S.L. Finnigan, B.V. Gago, G.E. (teller)
Gazzola, J.M. Hood, D.G.E. Hunter, I.K.
Kandelaars, G.A. Lee, J.S. Lensink, J.M.A.
Lucas, R.I. Ridgway, D.W. Stephens, T.J.
Wade, S.G. Wortley, R.P. Zollo, C.
NOES (3)
Franks, T.A. Parnell, M. (teller) Vincent, K.L.

Majority of 15 for the ayes.

Schedule thus passed.

The CHAIR: That cameraman who ran after that young lady, you can leave the chamber, please. Escort him out, security. I want to find out which television station he comes from as well.

New schedule 2.

The Hon. M. PARNELL: I move:

Page 176, after line 28—Insert:

Schedule 2—Modification of Indenture

1—Modification of Clause 7A

(1) Clause 7A(2)(b) of the Indenture—the passage ', and in such a case the EPA shall disclose its reasons for such conditions' is deleted

(2) Clause 7A(5) and (6) of the Indenture—subclauses (5) and (6) are deleted and the following subclauses are substituted:

(5) The Company may appeal to the Environment, Resources and Development Court against—

(a) a decision of the EPA imposing a condition mentioned in Clause 7A(2)(b); or

(b) a decision of the EPA refusing an application under Clause 7A(2)(c); or

(c) a failure on the part of the EPA to give notice to the applicant of its decision within the time specified in Clause 7A(3),

and the appeal will proceed in accordance with the Environment Protection Act 1993.

(6) An appeal under Clause 7A(5) must be instituted within two months of the notice mentioned in Clause 7A(3) or (as applicable) of the expiration of the time specified in that Clause.

(3) Clause 7A(7)(b) of the Indenture—paragraph (b) is deleted and the following paragraph is substituted:

(b) the EPA shall, in all relevant respects, have regard to, and seek to further, the objects of the Environment Protection Act 1993 and any environment protection policy made under that Act.

2—Modification of Clause 9

Clause 9 of the Indenture—the following subclause is inserted after subclause (2):

(3) However, the State must not proceed to provide any infrastructure, facilities or services in the circumstances set out in Clause 9(1) or (2) unless—

(a) all saleable copper produced above the amount referred to in Clause 9(2) is to be processed in South Australia; and

(b) all electricity required for the expanded project is to be generated from renewable energy sources; and

(c) the Company has agreed that all uranium that is capable of being extracted from any Product is to be directed to the tailings stockpile and that all tailings are eventually to be returned to the mine pit.

3—Modification of Clause 10

Clause 10(4) of the Indenture—subclause (4) is deleted

4—Modification of Clause 11

(1) Clause 11(1) of the Indenture—the word 'Minister' is deleted wherever it occurs and the following item is substituted in each case:

EPA

(2) Clause 11(4) of the Indenture—the passage 'him pursuant to Clause 11(1), the Minister' is deleted and the following passage is substituted:

the EPA pursuant to Clause 11(1), the EPA

(3) Clause 11 of the Indenture—the following subclause is inserted after subclause (4):

(4A) If an EMP includes any conditions or requirements that relate to a Project Approval under Clause 7, the EPA must consult with the Minister before it makes a decision under Clause 11(4).

(4) Clause 11(5), (6) and (7) of the Indenture—subclauses (5), (6) and (7) are deleted and the following subclauses are substituted:

(5) The EPA shall, within four months, or such longer period agreed by the Company, of receipt of an EMP submitted pursuant to Clause 11(1), give notice to the Company of its decision in terms of Clause 11(4)(a), 11(4)(b) or 11(4)(c). If the decision of the EPA is as mentioned in Clause 11(4)(b) or 11(4)(c), the EPA shall disclose to the Company its reasons for its decision.

(5A) The Company may appeal to the Environment, Resources and Development Court against a decision of the EPA in the terms of Clause 11(4)(b) or 11(4)(c) and the appeal will be determined as if it had been made under section 106(1) of the Environment Protection Act 1993.

(6) An appeal under Clause 11(5A) must be instituted within two months of the notice mentioned in Clause 11(5).

(7) Subject to the outcome of any appeal, the Company shall implement an EMP when approved by the EPA.

(5) Clause 11(8) of the Indenture—the word 'Minister' is deleted wherever it occurs and the following item is substituted in each case:

EPA

(6) Clause 11 of the Indenture—the following subclause is inserted after subclause (8):

(8A) The Company must also furnish the Minister with a copy of any report submitted to the EPA under Clause 11(8).

(7) Clause 11(9) of the Indenture—subclause (9) is deleted and the following subclauses are substituted:

(9) The Company shall, if requested by the EPA, review an EMP and submit to the EPA a revised EMP for approval within three months (or any longer period reasonably required or otherwise agreed by the EPA) after the date of the EPA's request. The provisions of Clauses 11(4) to 11(6), inclusive, apply, with any necessary modifications, in relation to the revised EMP (except that the EPA shall give notice of its decision within two months, or such longer period agreed by the Company, of receipt of the revised EMP).

(9A) The EPA must make a request under Clause 11(9) if asked to do so by the Minister.

(8) Clause 11(10) of the Indenture—the word 'Minister' is deleted wherever it occurs and the following item is substituted in each case:

EPA

(9) Clause 11(11)(a)(ii) of the Indenture—the passage 'an unexpected material detriment to the environment' is deleted and the following passage is substituted:

any environmental harm or environmental nuisance (within the meaning of the Environment Protection Act 1993)

(10) Clause 11(11)(a) of the Indenture—the word 'Minister' is deleted and the following item is substituted:

EPA

(11) Clause 11(11)(b) of the Indenture—the word 'Minister' is deleted wherever it occurs and the following item is substituted:

EPA

(12) Clause 11(11)(c) of the Indenture—the word 'Minister' is deleted wherever it occurs and the following item is substituted:

EPA

(13) Clause 11(11) of the Indenture—the following paragraph is inserted after paragraph (c):

(ca) The EPA must consult with the Minister before it imposes a requirement under Clause 11(11)(c).

(14) Clause 11(11)(e) of the Indenture—paragraph (e) is deleted and the following paragraph is substituted:

(e) If any action required under a Mitigation Plan which has been approved by the EPA (Approved Mitigation Plan) is not taken within the applicable timeframe or otherwise in accordance with the Approved Mitigation Plan, the EPA may direct the Company, by written notice, to take the action in accordance with the Approved Mitigation Plan, and if the Company does not comply with the EPA's direction within two months (or any period reasonably required or otherwise agreed by the EPA), the EPA (or a person authorised by the EPA for the purpose) may take the action required by the direction, and the Company shall pay to the EPA its reasonable actual costs incurred in taking the action.

(15) Clause 11(11)(f) of the Indenture—the word 'Minister's' is deleted and the following item is substituted:

EPA's

(16) Clause 11(11)(g) of the Indenture—the word 'Minister' is deleted wherever it occurs and the following item is substituted:

EPA

(17) Clause 11(11)(h) of the Indenture—paragraph (h) is deleted

(18) Clause 11(12) of the Indenture—the word 'Minister' is deleted wherever it occurs and the following item is substituted:

EPA

(19) Clause 11(12) of the Indenture—the word 'Minister's' is deleted and the following item is substituted:

EPA's

(20) Clause 11(13) of the Indenture—the passage 'Minister may' is deleted and the following passage is substituted:

EPA shall

(21) Clause 11(13)(e) of the Indenture—the word 'Minister' is deleted and the following item is substituted:

EPA

(22) Clause 11(15) of the Indenture—subclause (15) is deleted and the following subclause is substituted:

(15) If the rights of the Company under this Indenture to construct, operate or maintain an Outsourced Element are assigned (in accordance with this Indenture) to a person, the Company will remain jointly responsible with that person for the obligations under this Clause 11.

(23) Clause 11(18) of the Indenture—subclause (18) is deleted

5—Modification of Clause 11A

Clause 11A of the Indenture—redesignate the contents of this Clause as subclause (1) and insert the following subclause thereafter:

(2) In addition, the Company must adopt strategies that will achieve, by 31 December 2020—

(a) a reduction in the greenhouse gas emissions that are attributable to the operations conducted under this Indenture that is at least equal to 20 per cent of 1990 levels attributable to operations under this Indenture; and

(b) without limiting Clause 9(3)(b), at least 20 per cent of all stationary energy needs associated with operations conducted under this Indenture being met from renewable energy sources.

6—Modification of Clause 12

(1) Clause 12(4) of the Indenture—subclause (4) is deleted

(2) Clause 12(7) of the Indenture—subclause (7) is deleted and the following subclause is substituted:

(7) The Minister shall, within one month of receipt of the Industry and Workforce Participation Plan or an annual report, make the plan or report (as the case may be) publicly available.

(3) Clause 12(8) of the Indenture—subclause (8) is deleted

7—Modification of Clause 12A

Clause 12A of the Indenture—the following subclauses are inserted after subclause (2):

(3) If the Minister notifies the Company that it appears to the Minister that the supply of diesel fuel within the State may be (or is likely to become) inadequate for the demands of both the Company and other users of diesel fuel within the State, the Company shall, within one month of receipt of the notification, submit to the Minister a diesel fuel sharing plan that will ensure that the other users of diesel fuel within the State are not unreasonably disadvantaged by the operations of the Company under this Indenture.

(4) Without limiting Clause 11A(2)(a), the Company must offset the greenhouse gas emissions attributable to its use of diesel fuel in its operations under this Indenture by using recognised carbon offset practices.

8—Modification of Clause 13

(1) Clause 13(8) of the Indenture—the passage 'free of charge (except as provided in Clause 13(12))' is deleted

(2) Clause 13(8)(c)(i) of the Indenture—the passage 'may be referred to arbitration pursuant to Clause 49' is deleted and the following passage is substituted:

will be determined according to the final decision of the Water Minister

(3) Clause 13(8)(c)(iii) of the Indenture—subparagraph (iii) is deleted and the following subparagraph is substituted:

(iii) The Company shall comply with the terms of the notice as issued by the Water Minister.

(4) Clause 13 of the Indenture—the following subclause is inserted after subclause (9):

(9A) Notwithstanding any other provision in this Indenture—

(a) the Company is not entitled under this Indenture to draw underground water from wellfields located in the Great Artesian Basin after the tenth anniversary of the Variation Date; and

(b) the Company shall, within one year after the Variation Date, submit to the Water Minister a Water Supply Plan that—

(i) provides for the phasing out of the extraction of underground water from wellfields located in the Great Artesian Basin in order to achieve compliance with Clause 13(9A)(a); and

(ii) aims to bring the extraction of underground water from wells located in the area known as Borefield A to an end within five years after the Variation Date; and

(iii) identifies sites for a seawater desalination plant that will not be located in the Upper Spencer Gulf region; and

(iv) addresses any other matters specified by the Water Minister for the purposes of this Clause 13(9A).

(5) Clause 13(12)(c) of the Indenture—paragraph (c) is deleted and the following paragraph is substituted:

(c) The Water Minister may from time to time fix a maximum rate of any charge payable by the Company pursuant to Clause 13(12)(b) (and, in so doing, the Water Minister must ensure that the Company does not, as a result of the cap, pay an amount that is less than a fair and reasonable price for the water taking into account the value of the resource, its limited availability and the impact of the extraction of the water on the natural environment).

(6) Clause 13(12) of the Indenture—the following paragraphs are inserted after paragraph (g):

(h) Insofar as any water draw from underground water sources for the purposes of the Company's operations under this Indenture are not subject to a charge under Clause 13(12)(b), the Company shall, on and from the Variation Date, pay to the Water Minister a charge in respect of that water.

(i) A charge payable by the Company pursuant to Clause 12(12)(h)—

(i) will be at a rate determined by the Water Minister, or be set on some other basis determined by the Water Minister, after consultation with the Company (and may be varied from time to time by the Water Minister after consultation with the Company); and

(ii) must be set so as to recover (according to the determination of the Water Minister) an amount that is fair and reasonable for the water taking into account the value of the resource, its limited availability and the impact of the extraction of the water on the natural environment; and

(iii) shall be paid to the Water Minister according to a scheme established by the Water Minister for the purposes of this Clause 13 and may be applied by the Water Minister for such purposes as the Water Minister thinks fit.

(7) Clause 13(17A)(c)(iii) of the Indenture—subparagraph (iii) is deleted

(8) Clause 13(17A) of the Indenture—the following paragraph is inserted after paragraph (c):

(d) the State may, if the Minister considers that it is reasonable to do so, at the request of the Company, grant to the Company or to an associated company, as the Company may nominate to the Minister, (or procure the grant of), over the relevant approved site or location, exclusive rights by lease or licence for the construction, operation and maintenance of coastal inlet and outlet pipes (and related infrastructure) for the purposes of the Desal Plant, including without limitation, the right to exclude, or restrict or prohibit activities of, any person from the site or location (including without limitation the waters above the site or location) as required for the Company to conduct its operations and necessary activities associated with, or for the security and protection of, the coastal inlet and outlet pipes and related infrastructure and on reasonable terms consistent with this Indenture.

(9) Clause 13(17B)(c) of the Indenture—the passage 'exclusive rights referred to in Clauses 13(17A)(c)(iii)' is deleted and the following passage is substituted:

any exclusive rights granted under Clause 13(17A)(d)

(10) Clause 13(25) of the Indenture—the passage 'Except where expressly necessary for the purposes of implementing this Clause 13, the' is deleted and the following word is substituted:

The

(11) Clause 13(28) and (29) of the Indenture—subclauses (28) and (29) are deleted

9—Modification of Clause 14

Clause 14(1B)(c)(ii) of the Indenture—the amount '$1.00' is deleted and the following passage is substituted:

an amount determined by the Valuer-General from time to time so as to reflect a fair payment for the relevant lease

10—Modification of Clause 14A

Clause 14A(2)(b) of the Indenture—the amount '$1.00' is deleted and the following passage is substituted:

an amount determined by the Valuer-General from time to time so as to reflect a fair payment for the relevant lease

11—Modification of Clause 15

(1) Clause 15(2) of the Indenture—the passage ', at no cost to the Company other than as provided in Clause 31,' is deleted

(2) Clause 15(2B)(b) of the Indenture—the amount '$1.00' is deleted and the following passage is substituted:

an amount determined by the Valuer-General from time to time so as to reflect a fair payment for the relevant lease

(3) Clause 15(2C) of the Indenture—the passage 'To avoid doubt, the Company is not required to pay any amount under Clause 31(2) in relation to the grant.' is deleted

(4) Clause 15 of the Indenture—the following subclauses are inserted after subclause (3):

(4) The Company shall provide reasonable access to the airstrip and related facilities—

(a) in cases of emergency; and

(b) to eligible third parties in accordance with an access regime established under Clause 15(5).

(5) The Minister shall, within one year after the Variation Date, establish a third party access regime with respect to the airstrip and related facilities.

(6) An access regime established under Clause 15(5) may include—

(a) the procedures that must be followed by a party seeking access and procedures for the resolution of disputes; and

(b) access pricing principles; and

(c) the procedures to be followed to ensure that the facilities may be accessed safely; and

(d) the terms and conditions on which access may be granted; and

(e) other matters considered by the Minister as being appropriate in the circumstances.

(7) The Minister must consult with the Company before establishing, or varying, an access regime under this Clause.

12—Modification of Clause 16

(1) Clause 16(2) of the Indenture—the passage 'or resumed pursuant to Clause 31' is deleted

(2) Clause 16(2) of the Indenture—the passage ', at no cost to the Company other than as provided in Clause 31,' is deleted

(3) Clause 16(2C)(a)(ii) of the Indenture—the amount '$1.00' is deleted and the following passage is substituted:

an amount determined by the Valuer-General from time to time so as to reflect a fair payment for the relevant lease

(4) Clause 16(4) and (5) of the Indenture—subclauses (4) and (5) are deleted and the following subclause is substituted:

(4) In connection with the operation of this Clause 16—

(a) Part 2 of the Railways (Operations and Access) Act 1997 shall apply in relation to the railway constructed or to be constructed under Clause 16(2A), and the State agrees that it shall not exclude that railway from the operation of Part 2; and

(b) Parts 3 to 8 (inclusive) of the Railways (Operations and Access) Act 1997 shall apply to the railway constructed or to be constructed under this Clause 16.

13—Modification of Clause 17

(1) Clause 17(5) of the Indenture—the passage 'or resumed pursuant to Clause 31' is deleted

(2) Clause 17(5) of the Indenture—the passage ', at no cost to the Company other than as provided by Clause 31,' is deleted

(3) Clause 17(8)(b)—the amount '$1.00' is deleted and the following passage is substituted:

an amount determined by the Valuer-General from time to time so as to reflect a fair payment for the relevant lease

(4) Clause 17(13)(d)—paragraph (d) is deleted

(5) Clause 17(16)—subclause (16) is deleted and the following subclause is substituted:

(16) The access regime prescribed by the Maritime Services (Access) Act 2000 shall apply to the Port.

14—Modification of Clause 18

(1) Clause 18(11) of the Indenture—the passage 'or resumed pursuant to Clause 31' is deleted

(2) Clause 18(11) of the Indenture—the passage ', at no cost to the Company, other than as provided in Clause 31,' is deleted

(3) Clause 18(11B)(a)(ii) of the Indenture—the amount '$1.00' is deleted and the following passage is substituted:

an amount determined by the Valuer-General from time to time so as to reflect a fair payment for the relevant lease

(4) Clause 18 of the Indenture—the following subclauses are inserted after subclause (18):

(19) The Company shall provide reasonable access to its electricity infrastructure in accordance with an access regime established under Clause 18(20).

(20) The Minister shall, within one year after the Variation Date, establish a third party access regime with respect to the electricity infrastructure of the Company.

(21) An access regime established under Clause 18(20) may include:

(a) the procedures that must be followed by a party seeking access and procedures for the resolution of disputes; and

(b) access pricing principles; and

(c) the procedures to be followed to ensure that the infrastructure may be accessed safely; and

(d) the terms and conditions on which access may be granted; and

(e) the exclusion of special infrastructure, or classes of infrastructure, from the requirements of the scheme; and

(f) other matters considered by the Minister as being appropriate in the circumstances.

(22) The Minister must consult with the Company before establishing, or varying, an access regime under this Clause.

15—Modification of Clause 19

(1) Clause 19(1B)(d) of the Indenture—the passage ', but the State must co-operate with the Company and use best endeavours to facilitate the expeditious completion of any such processes' is deleted

(2) Clause 19(2)(b) of the Indenture—paragraph (b) is deleted

(3) Clause 19(2)(c) of the Indenture—the passage ', subject to Clause 34,' is deleted

(4) Clause 19(2)(c) of the Indenture—the following passage is inserted after the word 'safety' in paragraph (c):

or to preventing or reducing adverse effects upon the environment

(5) Clause 19(3)(g) of the Indenture—the passage ', but the State must co-operate with the Company to facilitate the expeditious completion of any such processes'

(6) Clause 19(6) of the Indenture—the passage ', subject always to the provisions of Clause 34 as to non-discrimination' is deleted

(7) Clause 19(10) of the Indenture—the passage ', without charge,' is deleted

(8) Clause 19 of the Indenture—the following subclause is inserted after subclause (10):

(10A) However, the Company must not dewater or drain an adjoining strata without an authorisation issued by the EPA for the purposes of this Clause 19(10A).

(9) Clause 19 of the Indenture—the following subclause is inserted after subclause (12):

(12A) Clause 19(12) does not apply if the Later Tenement is a licence under the Petroleum and Geothermal Energy Act 2000 that relates to a source of geothermal energy and, in such a case, the Later Tenement may be granted over land subject to a Special Mining Lease after consultation with the Company.

16—Modification of Clause 19A

(1) Clause 19A(6) of the Indenture—the passage ', subject always to the provisions of Clause 34 of the Indenture' is deleted

(2) Clause 19A(8) of the Indenture—the passage ', subject to Clause 34 as to non-discrimination,' is deleted

(3) Clause 19A(9) of the Indenture—the passage ', subject to the provisions of Clause 34 as to non-discrimination,' is deleted

17—Modification of Clause 24

(1) Clause 24(6), (7), (8) and (8A) of the Indenture—subclauses (6), (7), (8) and (8A) are deleted

(2) Claus 24(10) of the Indenture—the passage 'and any freehold land granted in accordance with Clause 24(8A)' is deleted

18—Modification of Clause 27

Clause 27(1) of the Indenture—the passage 'or resumed pursuant to Clause 31' is deleted

19—Deletion of Clause 28

Clause 28 of the Indenture—this clause is deleted

20—Deletion of Clause 30

Clause 30 of the Indenture—this clause is deleted

21—Modification of Clause 30A

Clause 30A(11) of the Indenture—the passage 'Clauses 27 or 31' is deleted and the following passage is substituted:

Clause 27

22—Deletion of Clause 31

Clause 31 of the Indenture—this clause is deleted

23—Modification of Clause 31A

(1) Clause 31A(1) of the Indenture—the passage ', 19A(18)(c) or 24(8A)' is deleted and the following passage is substituted:

or 19A(18)(c)

(2) Clause 31A(1) of the Indenture—the passage ', 19A(18)(b) and 24(8A)' is deleted and the following passage is substituted:

and 19A(18)(b)

(3) Clause 31A(2)(a) of the Indenture—the passage 'other than in respect of Requested Land or Rights requested under Clause 24(8A),' is deleted

(4) Clause 31A(2)(b) of the Indenture—the passage 'other than in respect of Requested Land or Rights requested under Clause 24(8A),' is deleted

(5) Clause 31A(4) of the Indenture—subclause (4) is deleted

24—Modification of Clause 32

(1) Clause 32(1A) to (3) (inclusive) of the Indenture—subclauses (1A), (2), (2A), (2B) and (3) of the Indenture are deleted and the following subclause is substituted:

(1A) Royalty on Product shall be calculated and payable on the basis which is equivalent to that specified from time to time to be payable in respect of the mining of the relevant mineral as provided in the Mining Act.

(2) Clause 32(7) of the Indenture—subclause (7) is deleted

(3) Clause 32(17) of the Indenture—subclause (17) is deleted

(4) Clause 32(18) of the Indenture—subclause (18) is deleted

(5) Clause 32(19) of the Indenture—subclause (19) is deleted

25—Deletion of Clause 33

Clause 33 of the Indenture—this clause is deleted

26—Deleted of Clause 34

Clause 34 of the Indenture—this clause is deleted

27—Substitution of Clause 35

Clause 35 of the Indenture—this clause is deleted and the following clause is substituted

35. CONFIDENTIALITY

A person involved in the administration of the ratifying Act must not divulge information relating to trade processes or financial information obtained (whether by that person or some other person) in the administration of that Act or on account of the operation of this Indenture except—

(a) as authorised or required by or under that Act or this Indenture; or

(b) with the consent of the person from whom the information was obtained or to whom the information relates, or with the consent of the Company; or

(c) to the Minister, or to an officer or employee of the Crown in connection with the administration or enforcement of that Act or the operation of this Indenture; or

(d) for the purpose of any legal proceedings arising out of the administration or enforcement of that Act or the operation of this Indenture.

28—Modification of Clause 36

Clause 36 of the Indenture—the following subclauses are inserted after subclause (5):

(6) If the Minister receives advice about an assignment or other disposition of an interest under Clause 36(1)(b) or (c), the Minister shall, within two months of the receipt of the advice, cause a report on the matter to be prepared.

(7) The Minister must, within six sitting days after receiving the report under Clause 36(6), cause a copy of the report to be laid before both Houses of Parliament.

(8) The report under Clause 36(6)—

(a) shall include an assessment of the affect that the assignment may have on the operation of this Indenture, or on any activities conducted under this Indenture; and

(b) may address any other matter considered appropriate by the Minister.

29—Deletion of Clause 40

Clause 40 of the Indenture—this clause is deleted

30—Modification of Clause 42A

(1) Clause 42A(10) of the Indenture—the passage 'Any information provided by the Company under this Clause 42A(10) shall be treated by the Minister and the Department of Primary Industries and Resources on a strictly confidential basis.' is deleted

(2) Clause 42A(14) of the Indenture—subclause (14) is deleted and the following subclause is substituted:

(14) The Minister may, notwithstanding Clause 35, make public any information about the requirements or costs associated with rehabilitation works that are required to be undertaken on account of any operations under this Indenture.

31—Deletion of Clause 43

Clause 43 of the Indenture—this clause is deleted

32—Substitution of Clause 47

Clause 47 of the Indenture—this clause is deleted and the following clause is substituted:

47. ENFORCEMENT

(1) Applications may be made to the Environment, Resources and Development Court for one or more of the following orders:

(a) if the Company has engaged, is engaging or is proposing to engage in contravention of a provision of this Indenture or the conditions of any Special Tenement—an order restraining the Company from engaging in the conduct and, if the Court considers it appropriate to do so, requiring the Company to take any specified action;

(b) if the Company has refused or failed, is refusing or failing or is proposing to refuse or fail to take any action required by a provision of this Indenture or the conditions of any Special Tenement—an order requiring the Company to take that action;

(c) if the Court considers it appropriate to do so, an order against the Company for payment (for the credit of the Consolidated Account) of an amount in the nature of exemplary damages determined by the Court to be appropriate on account of any breach of a requirement or obligation under this Indenture or the conditions of any Special Tenement.

(2) The power of the Court to make an order restraining the Company from engaging in conduct of a particular kind may be exercised—

(a) if the Court is satisfied that the Company has engaged in conduct of that kind—whether or not it appears to the Court that the Company intends to engage again, or to continue to engage, in conduct of that kind; or

(b) if it appears to the Court that, in the event that an order is not made, it is likely that the Company will engage in conduct of that kind—whether or not the Company has previously engaged in conduct of that kind and whether or not there is an imminent danger of substantial harm or damage if the Company engages in conduct of that kind.

(3) The power of the Court to make an order requiring the Company to take specified action may be exercised—

(a) if the Court is satisfied that the Company has refused or failed to take that action—whether or not it appears to the Court that the Company intends to refuse or fail again, or to continue to refuse or fail, to take that action; or

(b) if it appears to the Court that, in the event that an order is not made, it is likely that the Company will refuse or fail to take that action—whether or not the Company has previously refused or failed to take that action and whether or not there is an imminent danger of substantial harm or damage if the Company refuses or fails to take that action.

(4) In assessing an amount to be ordered in the nature of exemplary damages, the Court must have regard to—

(a) any environmental harm or detriment to the public interest resulting from the contravention; and

(b) any financial saving or other benefit that the Company stood to gain by committing the contravention; and

(c) any other matter it considers relevant.

(5) An application under this section may be made by any person.

(6) If an application is made by a person other than the Minister—

(a) the applicant must serve a copy of the application on the Minister within three days after filing the application with the Court; and

(b) the Court must, on application by the Minister, join the Minister as a party to the proceedings.

(7) An application under this section may be made in a representative capacity (but, if so, the consent of all persons on whose behalf the application is made must be obtained).

(8) An application may be made without notice to any person and, if the Court is satisfied on the application that the Company has a case to answer, it may grant permission to the applicant to serve a summons requiring the Company to appear before the Court to show cause why an order should not be made under this section.

(9) An application under this section must, in the first instance, be referred to a conference under section 16 of the Environment, Resources and Development Court Act 1993 (and the provisions of that Act will then apply in relation to the application).

(10) If, on an application under this section or before the determination of the proceedings commenced by the application, the Court is satisfied that, in order to preserve the rights or interests of parties to the proceedings or for any other reason, it is desirable to make an interim order under this section, the Court may make such an order.

(11) An interim order—

(a) may be made on an application without notice to any person; and

(b) may be made whether or not the proceedings have been referred to a conference; and

(c) will be made subject to such conditions as the Court thinks fit; and

(d) will not operate after the proceedings in which it is made are finally determined.

(12) The Court may order an applicant in proceedings under this section to provide security for the payment of costs that may be awarded against the applicant if the application is subsequently discussed.

(13) The Court may, if it considers it appropriate to do so, either on its own initiative or on the application of a party, vary or revoke an order previously made under this section.

(14) The Court may, in any proceedings under this section, make such orders in relation to the costs of the proceedings as it thinks just and reasonable.

(15) Without limiting the generality of subsection (14), in determining whether to make any order in relation to costs the Court may have regard to the following matters (so far as they are relevant):

(a) whether the applicant is pursuing a personal interest only in bringing the proceedings or is furthering a wider group interest or the public interest;

(b) whether or not the proceedings raise significant issues relating to the operation or effect of this Indenture.

33—Modification of Clause 48

Clause 48(1) to (5) (inclusive) of the Indenture—subclauses (1), (2), (3), (4) and (5) are deleted

34—Modification of Clause 49

(1) Clause 49(3) and (4) of the Indenture—subclauses (3) and (4) are deleted and the following subclauses are substituted:

(3) References to arbitration in this Clause 49 shall be to the Environment, Resources and Development Court constituted for the purposes of the particular proceedings by a member of the Court nominated by the Senior Judge of the Court (and the member of the Court so nominated is in this Clause 49 referred to as the 'arbitrator').

(4) An arbitration shall be conducted in accordance with the rules of the Court and the following principles will apply in connection with the arbitration:

(a) the arbitrator must take into account the objects of any Act that may be relevant to the matter to which the arbitration relates, and to any relevant statutory policies applying under any such Act; and

(b) subject to the operation of paragraph (a), the arbitrator will make such decision as appears to be fair and just in the circumstances after having regard to the integration into the relevant Project as a whole of the question, difference or dispute the subject of the arbitration.

(2) Clause 49(5) of the Indenture—the word 'arbitrators' is deleted and the following word is substituted:

arbitrator

(3) Clause 49(7) of the Indenture—the word 'arbitrators' is deleted wherever it occurs and the following word is substituted:

arbitrator

(4) Clause 49(8) of the Indenture—subclause (8) is deleted

(5) Clause 49(10) of the Indenture—subclause (10) is deleted

(6) Clause 49(12) of the Indenture—the item '7A,' is deleted

(7) Clause 49(12) of the Indenture—the item '31,' is deleted

35—Deletion of Clause 53

Clause 53 of the Indenture—this clause is deleted

36—Modification of Second Schedule

Second Schedule, Clause 1 of the Indenture—the passage 'Subject to Clause 34 of the Indenture the' is deleted and the following word is substituted:

The

37—Modification of Fourth Schedule

Fourth Schedule, Clause 1(i)—the passage 'subject to Clause 34 of the Indenture,' is deleted

New schedule negatived.

New Schedule 3.

The Hon. M. PARNELL: I move:

Page 176, after line 28—Insert:

Schedule 3—Amendment of Radiation Protection and Control Act 1982

1—Amendment of section 5—Interpretation

(1) Section 5, definition of the Indenture—delete the definition

(2) Section 5, definition of the Joint Venturers—delete the definition

2—Repeal of Schedule

Schedule—delete the Schedule

This amendment seeks the insertion of a new schedule 3. I have spoken to it already.

New schedule negatived.

Long title.

The Hon. M. PARNELL: I move:

Long title—After '1982' insert:

and to make a related amendment to the Radiation Protection and Control Act 1982

This is a consequential amendment, which proposes to amend the long title to include the reference to the Radiation Protection and Control Act, which should have been amended as part of this indenture bill.

Amendment negatived; long title passed.

Bill reported without amendment.

Third Reading

The Hon. G.E. GAGO (Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Regional Development, Minister for Tourism, Minister for the Status of Women) (12:16): I move:

That this bill be now read a third time.

The Hon. M. PARNELL (12:16): I will make a brief contribution on the third reading because, whilst this bill and debate over this bill have taken some time, it has served to put on the record the vast gulf that exists between the spin and the reality. The hype around this project has been absolutely extraordinary, yet when we scratch just a little below the surface we find that in almost every respect the hype and the spin are not matched by reality.

We are promised extra jobs in mineral processing, yet in reality there is nothing to stop the company sending all the ore to China and along with it most of the jobs. We were promised a carbon neutral project, yet we know that this single mine will blow all our greenhouse targets out of the water. It will undo all the good work that has been done so far on reducing our carbon footprint.

We were promised the world's best environmental practice under the watchful eye of an independent EPA, yet we know that that agency has no real power to dictate terms or to enforce compliance in the same way that it can with other polluting industries in South Australia; and if as a community we dare to try to raise the bar on these standards at any time over the next four decades to improve environmental performance, we will have to pay the world's richest mining company for the privilege of doing so.

We will have to compensate it if we make any of these environmental conditions any tougher than they are now, and that is an outrageous position to put this state in given the length of time this project will go for—many, many decades. A number of credible scientists, engineers, business people and community leaders have raised serious concerns about this project, yet the government has been blinded by dollars into dismissing these concerns or, even worse, refusing to even listen to them.

The spectacle, the sham, of a 1½ day select committee in the other house is testament to the desperation that this government had to avoid genuine security. But perhaps the greatest insult of all to the people of South Australia is that all the laws of our state are made subservient to the interests of the company and to the deal that it has struck with our government—all of the legislation of past parliaments overridden by this indenture.

I am very disappointed that the government did not use the opportunity, the leverage, if you like, of this expansion—the biggest industrial project in our state's history—to actually reclaim some sovereignty over our minerals, our environment and our economy. This was a golden opportunity to end the unfair concessions and the special treatment which are now locked in to continue for decades to come.

These are our minerals, they can only be dug up once and we have the authority to determine how, when, by whom and for what return. Instead, the government has taken us down the path that the former premier promised not to take, that is, to allow South Australia to become the world's quarry.

I would like to thank the enormous number of scientists, business people, environmental campaigners, Indigenous leaders and even BHP contractors and other ordinary South Australians who have helped me and helped the Greens to better understand this project and the enormous implications it has for South Australia, and I have tried to give voice to their concerns in this debate.

However, at the end of the day, we have this bill before us. It is a bad bill. It enshrines a bad deal for the people of South Australia and for our environment, and the Greens believe it could have been so much better. So, at the end of the day, at the end of this debate, I find that the assessment that I made many months ago has now come to pass. BHP Billiton, the world's richest resource company, said, 'Jump,' and all the government could do was ask, 'How high?' The Greens will be voting against the third reading of this bill.

The Hon. D.W. RIDGWAY (Leader of the Opposition) (12:20): I rise to make some brief comments as well in relation to the third reading of the bill. As members would be well aware, the opposition has supported this project—the expansion and the indenture. However, I think, while it is one of the most important bills to pass parliament in relation to the state's economic future, it was interesting to remind the BHP executives who were in the gallery last week that it was, indeed, the Liberal Party that started this whole process under the stewardship and premiership of David Tonkin.

We would not be here today if it had not been for his courage and strength, and that of other members of his team (including the Hon. Roger Goldsworthy) who, if you like, shepherded the legislation through the House of Assembly many years ago. It is interesting to note that the former treasurer and former minister for the Roxby Downs expansion, who was here with all his gusto last week, the opposition has been advised, is presently holidaying in Bali. If it was a bill of such significance, I would have thought he may have stayed here for this week at least; because, of course, this was a piece of legislation that we had to have passed through parliament before former premier Rann and former minister Foley retired.

We could see this morning from the minister's comments in relation to the simple negotiation about the royalties and the time frame of 45 years, that they were not able, not willing and, probably just simply, they did not know the answer. The government does not know the answer as to what their starting point was from the simple point of view of royalties. I think that is where the opposition, whilst supporting this legislation and indenture, will always be worried and concerned that the best deal has not been delivered to South Australia, that it was a time frame spelt out because we had the retirement of two senior members of government. It had to be done and dusted before they left the parliament.

Of course, when you make a decision, for example, to buy a car, that it is going to be on Wednesday 30 November, and that is the day you are going to buy the car and you have made the decision to buy the car, the price and the quality of the deal that you get goes out the window. I suspect that is what has happened with the final negotiations of this indenture bill. Some compromises have been reached that have not been in the best interests of South Australia. Sadly, today, the minister, on the simple issue of royalties, was not able to tell us the government's starting point; and I suspect there is a whole range of negotiations where former minister Foley and former premier Rann caved in in order to meet their time line.

Having said that, we wish BHP and their associated companies the greatest success because we know in the end that, the more successful their operation is, the greater will be the tremendous economic benefits that we hope will flow to our state.

The Hon. G.E. GAGO (Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Regional Development, Minister for Tourism, Minister for the Status of Women) (12:23): I rise to make a small contribution to the third reading. The Olympic Dam expansion is a transformational project for South Australia. This legislation is the most significant step in the project since the indenture was first ratified by parliament through the Roxby Downs (Indenture Ratification) Act 1982.

The indenture provides the basis of the benefits which are expected to accrue to the South Australian economy and community, including royalty payments, increased workforce participation and development, local supplier participation, Aboriginal economic development and regional development. Such an expansion does not happen overnight, and the government will still look to the BHP Billiton board to make a timely decision on the necessary approval.

There has been a very long process of negotiation to reach this point. I therefore take this opportunity to thank many of the key players and those who provided tireless support to the government and members of this place during the long hours of consideration of this bill.

Firstly I wish to acknowledge the former premier Mike Rann and the former minister assisting the premier with the Olympic Dam Expansion Project, Kevin Foley, for the many hours that they have spent working to deliver this indenture for the people of South Australia. They embraced this project at an early stage and then fought hard to see it realised, culminating in the signing of the revised indenture in Melbourne last month.

This work has been supported and continued by the current Premier Jay Weatherill. They were more than ably assisted through a six-year process by Mr Bruce Carter and the conscientious team of the Olympic Dam task force, led by Dr Paul Heithersay and his predecessor Paul Case. That task force has, over time, comprised specialist public servants seconded from other agencies.

I would like to highlight the work of Gaby Jaksa and Tom Finlay (from the Crown Solicitor's Office) in providing legal advice to the negotiating team; Sally Smith (from the former department of planning and local government) who played a key role in coordinating the assessment report on the final EIS; and the support provided to her by Robert Kleeman. Acknowledgements should also be extended to Rob Thomas (the chief scientific adviser to the task force), Peter Bradshaw, Sam Walker, Helen Thomas, Lachlan Kinnear, Margot Gall, Nicki Crawford, Stacy Dix and Raelene Darwin.

It takes two to negotiate, so I would like to acknowledge the efforts and goodwill provided by the team at BHP Billiton: Chief Executive Marius Kloppers, Group Executive and Chief Executive Non-Ferrous, Andrew Mackenzie; Dean Dalla Valle, the president of the Uranium Group; and his predecessor, Graeme Hunt.

I would also like to thank parliamentary counsel, and particularly Richard Dennis, for the extraordinary number of hours, the support and advice that they have offered; and the many departmental and ministerial advisers who have supported me through the second reading and committee stages of this bill including Peter Dolan, Phil Hazell and Andrew Solomon of the Environmental Protection Authority; and Ben Bruce and Neil Power of the Department for Water. I am very grateful to you all for your ongoing assistance and support.

As you are aware, they provided me with a great deal of assistance. Clearly, the indenture covers a wide range of highly technical elements and their assistance in expediting responses to all of the honourable members' questions was just fantastic and did make a major contribution in helping to smooth the ongoing progress of this legislation.

I want to take this opportunity to thank the opposition, the minor parties and the Independents for their contributions: in particular, the Leader of the Opposition and the member for Heysen, Isobel Redmond, and her team that were given early access to the indenture. They have worked in an extremely cooperative and collaborative way with the government, and have provided the bipartisan support a major project such as this warrants.

I am advised that this has taken a total of 21½ hours of debate in this chamber alone, including the second reading contributions and the committee stage, so 21½ hours of debate in this place and about 11 or 12 hours of debate in the other place as well. Every honourable member in this and the other place was given every opportunity to say their piece and to put forward whatever improvements or amendments they deemed fit. Every opportunity was given and I do congratulate honourable members for their efforts, their contributions and their willingness to work in such a cooperative way.

I would like to extend my thanks to anyone else that I may have inadvertently overlooked. I extend my thanks to all parties and individuals involved in contributing to the success of this bill.

The council divided on the third reading:

AYES (19)
Bressington, A. Brokenshire, R.L. Darley, J.A.
Dawkins, J.S.L. Finnigan, B.V. Gago, G.E. (teller)
Gazzola, J.M. Hood, D.G.E. Hunter, I.K.
Kandelaars, G.A. Lee, J.S. Lensink, J.M.A.
Lucas, R.I. Ridgway, D.W. Stephens, T.J.
Vincent, K.L. Wade, S.G. Wortley, R.P.
Zollo, C.
NOES (2)
Franks, T.A. Parnell, M. (teller)

Majority of 17 for the ayes.

Third reading thus carried; bill passed.

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