Rex Minerals

The Hon. M.C. PARNELL (14:55): I seek leave to make a brief explanation before asking a question of the Minister for Water and the River Murray on the subject of mining wastewater on Yorke Peninsula.

Leave granted.

The Hon. M.C. PARNELL: Yesterday, Rex Minerals announced to the stock exchange that they would be accepting the 99 conditions imposed by the government for their Hillside mine project near Ardrossan on Yorke Peninsula. This is despite the fact that Rex has previously announced that they will not be proceeding with the original proposal on which the 99 conditions and the public consultation were based. Up until this point, the government has kept the 99 conditions secret, but I understand they will be released by close of business today.

In the open-cut mining process, there will be a considerable quantity of dewatering required. In the original proposal, Rex Minerals planned to reinject contaminated waste mine water back into the ground. Apparently, one option is to blend this water with clean River Murray water before reinjection. It was also proposed to use River Murray water to deliver ore to port via a slurry pipeline.

Hundreds of South Australians have been in contact with my office in recent months concerned that the government has not got the balance right between mining, farming and environmental protection. Many of these people also write to the water minister, and from the responses that I have seen, the water minister washes his hands of the matter and handpasses all water-related issues to the Minister for Mineral Resources and Energy. My questions to the minister are as follows:

1. What input, if any, does the water minister have in relation to water impacts of mining proposals?

2. Does the minister believe that it is a good use of precious River Murray water to use it to transport mining products in slurry pipelines, or to dilute contaminated mining wastewater before discharge to the environment?

The Hon. I.K. HUNTER (Minister for Sustainability, Environment and Conservation, Minister for Water and the River Murray, Minister for Aboriginal Affairs and Reconciliation) (14:57): I thank the honourable member for his most important question, of course. On 28 July 2014, the government offered Rex Minerals a mining lease that imposes 99 conditions to manage any potential impacts from the proposal to develop a copper/gold/magnetite mine near Ardrossan and export ore concentrate via the existing port at Ardrossan.

Rex Minerals was given 21 days to consider and respond to the offer and the conditions on which it was made. The company has been granted an extension of time, I understand, to consider the offer. It is my advice that Rex Minerals has stated that it is committed to the full project, but is now considering options for lower cost start-up options.

The Hillside mine proposes the extraction of copper, gold and magnetite, initially through an open-cut pit, with later mining occurring underground. I understand that an open-cut pit approximately 2.5 kilometres long, one kilometre wide and 450 metres deep would be created through this process, if indeed that is the plan that they will adhere to. Unwanted rock overlying the ore body is proposed to be stored on site, with tailings to be stored in a facility within the largest waste rock stockpile. Initial processing of the ores would occur on site, producing a slurry that would be transferred through a pipeline to Ardrossan for dewatering and transfer onto ships through the existing port.

Rex Minerals submitted the mining lease proposal and management plan to the state government in support of its application. The EPA, I understand, assessed the mining lease proposal and management plan, and in November of last year provided the response that examined potential impacts under the Environment Protection Act. The Department of State Development prepared an assessment report for the proposal, with input and advice from the EPA.

If Rex Minerals agrees to the conditions imposed by the government and a mining lease is granted, Rex Minerals will be required under the Mining Act to prepare a program for environmental protection and rehabilitation to outline how it would adhere to the conditions included in the offer. The EPA will of course work with DSD, Rex Minerals and my agency of DEWNR to ensure that the Program for Environmental Protection and Rehabilitation (PEPR) adequately addresses any issues of environmental concern that we may have.

In terms of dewatering through the impact of the mine, mine dewatering is required, I understand, for safe working conditions. Groundwater would be extracted from a fractured rock aquifer during the life of the operation. The fractured rock aquifer at the project site is saline, ranging from about 10,000 to 50,000 milligrams per litre. Due to these elevated salinities, groundwater use is restricted to industrial use and is unsuitable for any other purpose. The nearest known user is the Arrium quarry nine kilometres to the north of the deposit.

Rex Minerals proposes to use a combination of water sources for ore processing. Water sources include 3.2 gigalitres per year from groundwater and 0.4 gigalitres per year from the SA Water pipeline. The groundwater component would be sourced from dewatering bores and in-pit sumps at the mine site. Groundwater modelling reports indicate that, during the dewatering phase, groundwater drawdown will be recorded up to a kilometre from around the mine site. Impacts to third party groundwater users are not anticipated due to this limited impact.

I understand the concerns of the honourable member. I understand his reluctance to accept this evidence that we have so far before us about the impacts or the potential impacts of this mine, should it proceed, but I ask him to understand also that we will need to see, if Rex decides to go ahead, a program for environmental protection and rehabilitation which will address all the concerns the government has put to the mining company.