Logistics Industries ENVIRONMENTAL SCAN · Source: WA Economic Profile April 2014 ... PortLink - an inland freight initiative to link WA’s regional ports and proposed Oakajee port

This document is an extract of the 2015 Environmental Scan prepared by the Logistics

Training Council for the Western Australian Department of Training and Workforce

Development. For more information please refer to the complete Environmental Scan.

Prepared by the Logistics Training Council for the Western Australian Department of Training and Workforce Development

17 Lemnos Street, Shenton Park, WA, 6008 – Postal: PO Box 7033, Shenton Park, WA, 6008

Telephone: (08) 9388 8781 - Facsimile: (08) 9388 8784 – Web: logisticstc.au

Logistics Industries

ENVIRONMENTAL SCAN

Updated July 2015

Regional Report

Logistics Industries Environmental Scan 2015

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Regional Report

Logistics Industries Environmental Scan 2015

Table of Contents

Overview ............................................................................................................................... 1

Gascoyne Region ................................................................................................................. 3

Goldfields Esperance Region ................................................................................................ 5

Great Southern Region ......................................................................................................... 7

Kimberley Region .................................................................................................................. 7

Mid West Region ................................................................................................................... 9

Peel Region ........................................................................................................................ 11

Pilbara Region .................................................................................................................... 12

South West Region ............................................................................................................. 13

Wheatbelt Region ............................................................................................................... 14

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Logistics Industries Environmental Scan 2015 Page 1

Overview

The following information relates to activity impacting on the transport and logistics industry and occurring in the nine regions of WA, as listed below:

Gascoyne

Goldfields/Esperance

Great Southern

Kimberley

Mid West

Peel

Pilbara

South West

Wheatbelt

Each region in WA has access to a $292 million fund over five years to develop major economic, social and community development projects through their Regional Investment Blueprints. Developed by each of the nine Regional Development Commissions, the Blueprints are plans for investment, outlining transformative strategies, priority actions and investment opportunities. They are plans for growth. 1

Through consideration of local issues and conditions the Regional Investment Blueprints will develop strategies to grow the region's economic base through the development of its competitive advantages, workforce and community. The Blueprints will guide the types of investment and inform the strategic allocation of Royalties for Regions funding into infrastructure and services for regional communities.2

The Department of Regional Development administers the State Government’s multi-billion dollar Royalties for Regions program and works in partnership with independent authorities such as the Regional Development Commissions, Regional Development Council, and the Western Australian Regional Development Trust, and collaboratively across government agencies, the private sector, and community partners.3

Since December 2008, Royalties for Regions has invested $6.1 billion of the State's mining and onshore petroleum royalties to more than 3,600 projects and programs, including transfers to the Future Fund and other Special Purpose Accounts.4

Royalties for Regions promotes and facilitates economic, business and social development in regional Western Australia for the benefit of all Western Australians. Royalties for Regions will invest $4 billion over four years across regional Western Australia from 2015-16.5

The following table indicates the population and employment rates in each of the regions for the period 2012-2013.

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Figure 1 - Regional population and employment rates

Regional labour markets and population

Region Population Annual Growth %

Employed Unemployed Unemployment Rate %

Perth/Peel 1979482 3.5 1037318 46837 4.3

South West 169682 3 87139 5224 5.7

Wheatbelt 75009 1.4 46333 2105 4.3

Pilbara and Offshore 66298 3.3 28596 1527 5.1

Goldfields-Esperance 61926 1.9 37012 2005 5.1

Great Southern 59234 1.9 32982 1974 5.6

Mid West 57901 2.4 31381 2096 6.3

Kimberley 39890 4.6 17496 2297 11.6

Gascoyne 9899 1.2 6071 473 7.2

Source: WA Economic Profile April 2014

The Ports Legislation Amendment Act 2014 was passed by Parliament during the 2013/14 financial year and seven of the existing regional port authorities have been consolidated into four new port authorities. From 1 July 2014, the Pilbara Ports Authority took over the roles of the Dampier and Port Hedland Port Authorities, the Geraldton Port Authority was reconstituted as the Mid West Ports Authority and the Broome Port Authority reconstituted as the Kimberley Ports Authority. The port authorities of Albany, Bunbury and Esperance were amalgamated on 1 October 2014 under the newly established Southern Ports Authority.6

In March 2015 it was announced that 25 regional airports would share in over $25 million in Government funding through the 2015-17 Regional Airports Development Scheme (RADS).7 The grants program is used to develop and maintain regional aviation infrastructure and airport services. The grants can also be used to develop terminal buildings and Royal Flying Doctor patient transfer facilities, and for security equipment. The funding allocations for each WA region include:

Gascoyne $94,000

Goldfields Esperance $698,621

Great Southern $81,290

Kimberley $610,829

Midwest $742,764

South West $109,839

Wheatbelt $164,618

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The following figures show imports and exports through WA’s ports in 2014 and WA’s port and resources.8

Figure 2 - Western Australian port authorities' imports and exports for 2014

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Figure 3 Western Australian ports and resources 2014

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Gascoyne Region

The Gascoyne region sits between the thriving resources regions of the Pilbara and the Mid West. To the north west of the Gascoyne, significant oil and gas exploration and extraction activities are ongoing in the Carnarvon and Browse Basins.9

The major industries of the region are tourism, retail, horticulture, mining, fishing, and pastoralism. The mining industry primarily concentrates on salt production at Useless Loop in the Shire of Shark Bay and at Lake MacLeod near Cape Cuvier, north of Carnarvon. When operating at their current full capacity of 5.2 million tonnes per annum, these two operations account for nearly half of the state’s total salt production.10

Harbour infrastructure ranges from privately owned and operating salt loading facilities for bulk carriers, eg Rio Tinto Salt private loading facility at Cape Cuvier, to basic boat ramps.11

An airport is located at Learmonth Air Force base and there are small airstrips in several towns, as well as several hundred private light aircraft strips located at mine sites and pastoral leases throughout the Gascoyne region. Some have the capacity to take RFDS aircraft while most are used for aerial mustering.12

Oil and gas production in the Exmouth Sub-basin is in the main carried out using Floating Production Storage and Offloading (FPSO) vessels connected to subsea wells via flexible flow lines. This industry is carried out in Commonwealth waters and the production value is not considered part of the Gascoyne economy. Servicing the offshore oil and gas industry near Exmouth is considered a significant development opportunity for Gascoyne businesses.13

Goldfields Esperance Region

The Goldfields-Esperance region is located in the south-eastern corner of Western Australia and comprises nine local government areas, with the City of Kalgoorlie-Boulder home to 54 per cent of the population.14

The economy of the Goldfields-Esperance region is based on the extraction and processing of mineral resources. In 2012-13, the estimated value of mining was $9 billion. Gold accounts for the majority of production value with nickel and iron ore mining the growth drivers. The coastal part of the Goldfields-Esperance region enjoys a mixed economy of agriculture, fisheries, mining and tourism. Esperance port, the deepest port in the southern hemisphere, provides infrastructure as the entry and exit point for north to south transport.15

The road network comprises 1,000 kilometres of Auslink highways, 950 kilometres of State highways and over 17,000 kilometres of local roads, with users including the mining industry, pastoral/agricultural industries, tourism and general freight.16

The rail network carries general freight and passenger services through the region, providing a major link with Eastern Australia. Track upgrades are required for safety, reliability and significantly increased tonnages of mineral ores, especially moving north to south to access the Esperance port.17

Esperance Port is the largest nickel concentrate exporting port in the southern hemisphere and the gateway to world markets for Australia’s principal nickel mining region. The Port is also a major grain exporting hub and handles bulk imports such as fuel and fertilisers.

http://www.gdc.wa.gov.au/contents/investing/tourism.htm?id=125

http://www.gdc.wa.gov.au/contents/investing/small-business.htm?id=129

http://www.gdc.wa.gov.au/contents/investing/horticulture.htm?id=126

http://www.gdc.wa.gov.au/contents/investing/mining.htm?id=128

http://www.gdc.wa.gov.au/contents/investing/fishing.htm?id=127

http://www.gdc.wa.gov.au/contents/investing/pastoral.htm?id=144

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Esperance Port Authority handled a record 14.9 million tonnes of cargo during the 2013/14 financial year, an increase of 7.6 per cent on the previous year. The number of trading vessels visiting the Port of Esperance also rose during the period, up from 192 in 2012/13 to 197 vessels.18

Aviation is a critical component of the region’s transport system. Many employees in the resources sector work on a fly-in fly-out basis, both to larger centres and to some of the remote sites in the region. In addition to scheduled air services, a number of charter operators also service the region, including smaller remote mining operations and resource camps.19

Difficulties have existed in attracting and retaining staff in Kalgoorlie. This can be attributed to a number of factors including loss of staff to higher paying jobs, and people relocating to other areas to complete studies. The availability of education facilities is often a key component of decision making with regards to migration.20 Many young people leave when they are teenagers and return in their 30s, and. older people may head towards the coast as they near retirement age.21

Planned, pending and completed projects include:

Esperance Multi-User Iron Ore Facility - proposed to cater for a number of junior mines located within the Yilgarn area of WA. This project, which could expand iron ore handling capacity from 11.5 Mt per annum to 20 Mt per annum, at a cost is $300 million, has been put on hold due to tumbling iron ore prices.22

Esperance Port Access Transport Corridor – a series of road and rail improvements south of the harbour road to Pink Lake Road intersection, improving access into the Port, safety and efficiency for local commuter and tourist traffic was completed in April 2014.23

Kalgoorlie to Esperance Rail Upgrade – upgrading the Kalgoorlie to Esperance rail line will provide for efficient operation of line trains including targeted rail duplications, with construction commencing in 2015.24

Leonora to Esperance Rail Line Upgrade - planned upgrades include a crossing loop program, train control, communications and signal system upgrades in the short term, a rerail and resleepering program in the medium term, and grade and axle load improvements in the long term.25

Norseman and Eucla Airstrip all weather upgrades – improvement of the runway surfaces of the Norseman and Eucla airstrips to enable all weather access. Access is currently limited due to inundation events and the airstrip not meeting requirements for larger aircraft.26

PortLink - an inland freight initiative to link WA’s regional ports and proposed Oakajee port to the eastern states’ transport corridors through a new intermodal logistics hub to be located in Kalgoorlie. This will significantly reduce freight movements on the Great Northern and North West Coastal highways between Perth and the north and between the eastern states and the Perth metropolitan area. Studies undertaken over the period from 2012 to 2014 include:

economic feasibility and logistics analysis and preliminary site selection for a proposed intermodal terminal in Kalgoorlie

Kalgoorlie rail realignment and integration with the proposed north west road bypass

planning for the upgrade of the Goldfields Highway between Wiluna and Meekatharra

inland freight corridors and direct road link to the Great Northern Highway.27

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Ravensthorpe Heavy Haulage Route – $7.5 million of Royalties for Regions funding has been provided to construct a dedicated heavy vehicle route around the town of Ravensthorpe to avoid the existing steep hill within the town. There are about 31,000 large truck movements through Ravensthorpe each year, a number set to increase with agricultural and mining developments in the region. These vital road works will address the community safety issues by providing a heavy vehicle route around the town and allow large vehicles to bypass Ravensthorpe's main street.

Great Southern Region

The Great Southern Region borders the Southern Ocean on the southern coast of WA and extends inland for 200 kilometres. It comprises 11 Local Government Authorities (LGAs) and covers 39,007 square kilometres of prime natural and agricultural land. It represents 1.5% of Western Australia’s total land mass and has a population of nearly 60,000 people.28

The Great Southern Region has a strong reliance on agricultural, retail, manufacturing, construction and tourism industries and associated infrastructure. These industries provide opportunities for value-adding to the region. Well-developed infrastructure, energy and water management systems are integral to increasing productivity and growing the region responsibly. The region’s access to aviation and rail infrastructure ranks low, and the road and port infrastructure is ranked medium nationally. To maximise efficiencies, upgrading of the road, rail and port major service networks and energy infrastructure needs to occur.29

The region’s main road network consists of 1,561 km of roads. The region’s City of Albany Airport has a daily service and is capable of carrying aircraft up to the size of Boeing 737. Albany is the infrastructure hub for the region’s agriculture and mining industries.30 Continuing growth brings demand for skilled people. Transport is one of the key growth areas which is increasing the demand for skilled tradesmen and professionals.31

The port of Albany mainly handles woodchips, wheat, canola and barley. Other commodities include fertiliser, petroleum products and silica sand. The port is a significant contributor to the Great Southern regional economy, with close to $1 billion of products moving through the port annually.

The Albany Port Authority (APA) achieved a record tonnage in 2013/14, with port trade achieving 4.6 Mt of which 98 per cent consisted of exports. This represents an increase in trade volume of 12 per cent from 2012/13, which can be attributed to 2.9 Mt of grain exports from stronger than average harvests. Woodchips represent the second largest export at 31 per cent of total port throughput. This has increased by 27 per cent from the previous year, from 1.1 Mt in 2012/13 to 1.4 Mt for 2013/14.32

Kimberley Region

The Kimberley is Western Australia’s most northerly region, bordered by the Pilbara region to the south and the Northern Territory to the east. The Kimberley is vast, covering an area of 424,517 square kilometres. This is approximately one sixth of WA’s land mass.33

The Kimberley is one of the fastest growing regions in Western Australia. The population has been projected to have an average growth rate of 2.9% per annum from 2006 to 2021 (Regional Development Australia 2011). Approximately half of the population is Aboriginal. This represents about one fifth of the State’s Aboriginal population.

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Agriculture, tourism, construction, retail industries and the resource sector are the region’s major industries and combine with the traditional Kimberley pastoral and pearling industries to provide a diverse economic base supported by a growing service industry. In terms of production, the resources industry is the most dominant in the Kimberley Region, with significant production in diamonds, iron ore, nickel and gold.

The major modes of transport for the region include travel by air, road and sea. The Kimberley has ports in Broome, Derby and Wyndham which operate as critical links for the region with

live cattle export via Broome and Wyndham, agricultural and mining cargo through Wyndham, and Broome servicing the expanding oil and gas industry. The Kimberley also has an extensive network of airports and airstrips providing inter and intra regional travel and transport options. In addition, the Kimberley has a regional road network of over 7,700 km,

including the Great Northern Highway which provides a sealed link across the region.34

Broome, like many other regional centres, heavily relies on either resources projects or tourism. Although oil and gas prices have weakened in recent times, analysts anticipate prices to recover in the late 2016 to 2017 period.35 This would be in time for a semi-submersible platform, currently being built to come on line 220 kilometres off the coast of Broome. The economic flow-on effects would include demand for helicopter services to transport crew and supplies off-shore. There are however, some challenges facing the offshore oil and gas industry in the Browse basin due to airspace congestion at Broome and fuel and alternate resources given the long flight distances.36

The Port of Broome handles petroleum products, construction materials, break bulk cargoes, livestock exports, cruise liners and expeditionary cruise vessels, along with wharf support requirements of the regional pearling, fishing, and tourism industries.

During 2013/14, the Port of Broome’s throughput totalled 518,145 tonnes of high value cargo involving 1,214 vessel visits. Petroleum products were the dominant import and transhipment cargo (185,786 tonnes, comprising diesel, un-leaded petroleum and aviation fuel). Container traffic decreased to 218 TEUs during 2013/14, compared with 4,439 TEUs during 2012/13 when a temporary trade arose to manage containers of construction material for the Pilbara Gorgon Project.

Total imports during 2013/14 decreased by eight per cent compared to the previous year while total exports increased by four per cent compared with 2012/13. Live cattle exports increased by 49 per cent compared to 2012/13, mainly due to improved market access to Indonesia.

In 2013/14 the port of Wyndham achieved a total cargo trade throughput of approximately 2.1 million tonnes (Mts), which represents an increase of 2 per cent from the previous year. Trade mainly comprises of iron ore from the Ridges Iron Ore project, shipped to China. Iron ore exports commenced in July 2011 using a barge loading facility and transported on bulk carriers, loaded within a kilometre of the wharf. Three 55,000 tonne shipments are exported every month.37

Pearling has been a major industry of the Kimberley for over a century, when naturally occurring ‘mother of pearl’ shell was sought after for the manufacture of clothing buttons. The cultured pearl industry operates from Broome to Darwin and has historically been a major provider of regional employment opportunities. The Global Financial Crisis in 2008/09 impacted this industry substantially and present reports estimate that at least 50% of the pearling industry is in ‘standby’ mode, awaiting improved economic conditions.38

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The Argyle Diamond Mine, located in the East Kimberley, accounts for all of WA’s diamond production and produces around 90%of the world’s pink diamonds.39

Major iron ore projects are located on Cockatoo Island, Koolan Island and south of Wyndham. Nickel, copper and cobalt projects are located south of Kununurra, diamonds and crude oil is located across the region and gold is produced from Halls Creek and further east in the Tanami area.40

The Ichthys Gas Field is located approximately 440 km north of Broome and 800 km south west of Darwin, covers an area of around 800 square kilometres in water averaging depths of around 250 metres and represents the largest discovery of hydrocarbon liquids in Australia in 40 years. The work involves a pipeline, essentially from the Browse field to Darwin (approximately 900 km), and will run for one year offshore. The installation will run between the fourth quarter 2014 and the fourth quarter 2015, whilst the offshore survey work and sea bed mapping for the pipeline route has already commenced. Ships will be operating out of Broome, with crews mobilising to vessels out of Darwin.41

Mid West Region

The Mid West covers about 466,800 km2 or nearly one-fifth of WA. Geraldton is the regional centre of the Mid West. The city and surrounds contain about 36,000 people, more than half the entire region’s population of 49,000.42

Whilst mining has been a major contributor to the Mid West’s economy for some years, the region also boasts valuable agriculture, fishing and tourism industries. There are currently many mining projects and transport and infrastructure projects to support the industry.

The rail network in the Mid West region is owned by the WA State Government and is managed and operated on a long-term lease by Brookfield Rail until 2049. Rail haulage consists of iron ore, grain and mineral sands and is critical to getting products to market and reducing road traffic. With the emergence of the Mid West as a prominent iron ore province, there has been a significant increase in demand for capacity on the rail network to transport product to export markets through Geraldton Port.43

Now a heavy haul railway, the rail network in the Mid West region has the capacity to transport up to 2 5 million tonnes per annum (tpa), and with further upgrades potentially well beyond 75 tpa. The main depot at Narngulu, 13km from the port of Geraldton, is the junction of the two railway lines that come from the south. Another line branches off at Dongara to service the mineral sand deposits at Eneabba.44

The Mid West is well serviced with a network of major sealed roads connecting Geraldton to Perth, the North West and the hinterland. The sealing of sections of the Goldfields Highway represents an early stage of the proposed State Government endorsed PortLink Infrastructure Corridor, which seeks to establish integrated infrastructure corridors linking major regional and state ports including Port Hedland, Geraldton/Oakajee, Esperance and Kwinana. It also provides the basis for connecting Oakajee/Geraldton with the Eastern States via a standard gauge rail through Kalgoorlie.45

More than half Geraldton port’s exports are generated from minerals and iron ore. Exports make up over 90 per cent of the total volume throughput of the port. New export infrastructure was opened in September 2012 for shipping haematite and magnetite ore from the Karara mine, 220 km east of Geraldton. Imports through the port include petroleum products,

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phosphate, fertiliser and urea. Exports include wheat and other grains, iron ore, mineral sands, talc, stockfeed, livestock, copper and zinc and concentrates.46

The Port of Geraldton recorded a strong trade performance during 2013/14 following the completion of a number of major construction projects, combined with the commissioning of new mines. Exports rose 20 per cent from the 2012/13 financial year and reached a record 18.5 million tonnes in 2013/14. A record 1,027 shipping movements were recorded at the port. The main export product continues to be iron ore, which has experienced strong growth of 35 per cent to 14.4 Mt since the previous year. This increase was driven by a full year of production by Karara Mining and the concurrent operation of mining activities at Tallering Peak and Extension Hill by Mount Gibson Iron. The port recorded a stronger than average grain export performance due to the availability of carryover grain. Total exports recorded for 2013/14 were 2.08 Mt which was about 15 per cent higher than average.47

Brookfield Rail recently completed a $550 million upgrade to the rail infrastructure in the Mid West, providing a robust, safe and sustainable rail freight network now, and for well in to the future. The Mid West Rail Upgrade completely transformed over 184 kilometres of the rail network and related infrastructure from Morawa north through Mullewa and west to Geraldton Port, increasing rail capacity from an initial 3 million tonnes per annum (mtpa) to 25mtpa, and potentially well beyond to 75mtpa.48

The proposed Oakajee port is part of the multi-billion dollar Oakajee Mid West Development Project that proposes to establish an integrated deep water port, 550 km of heavy haulage rail and industrial estate to support the development of the resources sector in the Mid West.49 Oakajee port is intended to accommodate vessels up to 180,000 dead weight tonnage. Under current planning, the proposed Oakajee port has an anticipated initial start-up capacity of up to 45 mtpa with plans for further expansion as demand grows. 50

The planned Oakajee Narngulu Infrastructure Corridor (ONIC) will provide a road, rail and utility services corridor linking the proposed Oakajee Port and adjacent strategic industrial estate with the existing Narngulu industrial area and Geraldton Port. The corridor will be approximately 34 km long and 250 m wide and enable the coordinated delivery of critical transport and service infrastructure to stimulate the development of the regionally significant sites. ONIC will also support a new outer freight bypass road around Geraldton.51

Geraldton airport is owned and operated by the City of Greater Geraldton. Development of various major projects including Oakajee and several proposed resources projects, including onshore gas developments, would place further pressure on the terminal, which is currently operating at its practical limits in terms of capacity of its passenger and baggage security screening facilities and sterile departures lounge.52

Upgrades to navigational aids at Geraldton Airport were completed in 2014 by Airservices Australia. In addition to this a new apron with pavement capacity and the extension of taxiway ‘Bravo’ were also completed. These development works form part of the 2012-2030 Master Plan for Geraldton Airport. Although the passenger numbers decreased in 2013-14, they still remained higher than 2011 figures (the year in which the air route was deregulated).[i]

Gindalbie Metals’ magnetite mine at Karara, 225 km east of Geraldton officially opened in April 2013. The development involved over 185 kilometres of new track installed by Brookfield Rail from Morawa to Mullewa through to Geraldton Port.53 Initially the railway will support the increase in tonnages to be delivered to Geraldton Port, however in the future it can also support Mid West miners to export through Oakajee Port. Upgraded from 3 million tonnes per

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annum (mtpa), the railway has the capacity to support 27.5 mtpa, and through staged incremental investment can grow to 75 mtpa.54

The Jack Hills iron ore mine in WA’s mid-west region, owned by Crossland Resources, currently produces about 2 million tonnes per annum of premium grade iron ore lump and fines per year. The company is planning a substantial expansion of annual production at Jack Hills and advanced feasibility studies are being undertaken.55

Peel Region

The Peel region covers over 5,600 square kilometres and represents approximately 0.2% of the State’s total area. It is located immediately south of Perth and lies between the metropolitan area and the South West region.

The Peel’s economy is strong and diverse. It is dominated by mineral processing - the area has large reserves of bauxite, gold and mineral sands and two alumina refineries, at Pinjarra and Wagerup. Gold mining is strongest at Boddington, which has Australia’s largest producing gold mine. The region is complemented by stable manufacturing and construction service industries, agriculture, tourism and retail trade.56

In 2012-13, the Peel’s mineral industry was valued at $3.2 billion. Alumina production accounted for almost $2 billion or 62 per cent of the region’s total mining production. The Peel currently produces all of the state’s bauxite.57

The Huntly Mine, located near Dwellingup, is the world’s largest bauxite mine supplying bauxite ore to Alcoa’s Pinjarra and Kwinana refineries. Huntly bauxite production has doubled since 1990 and currently produces around 23 million tonnes of bauxite per year. Alcoa’s Willowdale bauxite mine supplies the Wagerup refinery, both located in the Shire of Waroona. BHP Billiton mines bauxite in the Shire of Boddington, supplying its Worsley refinery in the Shire of Collie in the South West region. In 2012-13, gold, copper and silver made up the remaining 38 per cent of mining production, totalling $1.2 billion.58

There is a strong regional road network supported by local roads in urban and rural areas. The public transport system comprises the Mandurah passenger rail service, the Australind passenger rail service on the south west railway line, and the Transperth passenger bus service operating in Mandurah and surrounds to Pinjarra. The freight rail service between Perth and Bunbury passes through the region. Operated by Brookfield Rail, the service is crucial to the region’s mining sector.59

A planned project in the Peel region is the Peel Business Park at Nambeelup, a 1300 hectare industrial estate approximately 60 kilometres south of the Perth business centre.60 It is proposed that the business park will incorporate innovation and technology, transport and logistics, engineering and manufacturing, education and research, agriculture and bio industries and light industry and commercial support industries.61 New education and industry partnerships will be developed to supply the skills needed to power this major economic driver over the next 30 years. On completion the Business Park is expected to generate up to 17,000 new jobs and an annual economic output of $2.3 - $2.6 billion.

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Pilbara Region

Encompassing 507,896 square kilometres from the North West coastline to the border of the Northern Territory, the Pilbara is one of the largest regions in WA.62 The Pilbara's economy is strongly dominated by the mining and petroleum industries and is considered to be the State's premier mining region. These industries are growing at a considerable rate.63

The largest export commodity in Australia is iron ore and approximately 95% of this is produced in the Pilbara. Demand for iron ore traditionally comes from Japan which is now joined by China and other rapidly developing Asian nations. New projects are continually being proposed and developed in the region as extensive geological research is uncovering more resources.64

The region also produces 70% of Australia's natural gas. This is sourced from the Carnarvon Basin offshore and is serviced and processed onshore from the Pilbara. In addition to iron ore and natural gas, 85% of Australia's crude oil and condensate comes from the Pilbara. Other minerals extracted in the region include salt, silver, gold, manganese and base metals. Other industries include manufacturing, tourism, sheep and cattle, fishing and aquaculture. All figure prominently in the economy of the region, providing a diversity of activity and a range of business opportunities.65

The Port of Port Hedland consistently exceeds its trade records and retains the title of the world’s largest bulk export port. The port achieved a record tonnage throughput of 372.3 million tonnes (Mt) for the 2013/14 financial year, which represents growth of 83.8 Mt from the previous year, or 29 per cent. Iron ore exports dominated trade and totalled 364.3 Mt. More than 2.2 Mt was imported through the port for the 2013/14 financial year. Imports and exports rose 16 and 29 per cent respectively from 2012/13 and projected growth for the next five years remains strong.66

At Port Hedland, BHP Billiton and Fortescue Metals Group are expanding capacity by approximately 220 Mt per annum at a cost of $2.2 billion. In addition, Chevron Australia Pty Ltd is progressing a $52 billion new LNG development at Ashburton North, and Roy Hill will construct a purpose built iron ore port facility at Southwest Creek to receive, stockpile, screen and export 55 Mt per annum of iron ore.67

The Pilbara Cities Office (PCO) was established in April 2010 to address issues associated with significant growth in the region. Since then, the PCO has committed more than $1 billion in Royalties for Regions funds with relevant local and state government agencies across the key focus areas of infrastructure coordination, land availability and development, community projects and engagement and economic diversification. The aim is to build the population of Karratha and Port Hedland into cities of 50,000 people, and Newman to 15,000 people by 2035, with other Pilbara towns growing into more attractive, sustainable local communities.68

Construction of the $35 million upgrade of Karratha Airport is expected to be completed in December 2015. As Western Australia’s second busiest airport, the redevelopment project includes an increased number of arrival/departure gates, bigger departure lounge and a first floor addition to accommodate airport lounges. Upon completion, airlines will be given the opportunity of running international flights through Karratha.69

Oil and gas projects include the following:

http://www.pdc.wa.gov.au/regional-information/history/

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North West Shelf – a joint venture between six major international companies and operated by Woodside. Project facilities constitute Australia’s largest oil and gas resource development and currently account for more than one third of Australia’s oil and gas production.70

Woodside Pluto project – the $15 billion LNG plant started in 2012 and processes gas from the Pluto gas field, located in the Carnarvon Basin about 190 km north-west of Karratha. Onshore infrastructure comprises a single LNG processing train with a forecast production capacity of 4.3 million tonnes a year.

Gorgon Project – one of the world’s largest natural gas projects and the largest single-resource development in Australia. Based on Barrow Island, the Gorgon Project includes an LNG facility with three processing units designed to produce 15.6 million metric tons of LNG per year.71

Wheatstone Project – LNG and gas project developed by Chevron Australia, and supplied from the Wheatstone and large off-shore gas fields. The project will include an onshore facility located at Ashburton North Strategic Industrial Area, 12 kilometres west of Onslow. The foundation project includes two LNG trains with a combined capacity of 8.9 million tonnes per annum (MTPA) and a domestic gas plant. 72

South West Region

The South West is the most populous of WA’s regions. It fronts the Indian and Southern oceans, covering 24,000 km2, and includes 12 local government areas,73

The region has a diverse economic base, with mining, manufacturing, construction, tourism, agriculture and timber processing being key drivers. There is a strong small business and retail sector with about 15,400 businesses in the South West. The main contributors to economic production in the region are mining (22.5%), construction (13.2%) and manufacturing (10.8%).74

Small and medium enterprises are the most significant regional employers. The mining sector, mineral processing, transport and earthmoving sectors are characterised by fewer companies employing larger numbers of people.

Kemerton Industrial Park (KIP), located 17 km north of Bunbury, is the main strategic industrial area in the South West region and the nearest regional heavy industrial site to Perth. It is accessible to the Port of Bunbury by road and a rail link is being planned. The Government is progressing Kemerton towards project ready status by undertaking environmental, heritage and planning approvals for the estate. This work commenced in 2009 and was anticipated to be completed in 2015.75

The Bunbury Port Authority (BPA) achieved an overall record trade for the 2013/14 year, with increases in both overall exports and imports. Total trade for 2013/14 was 15.61 million tonnes (Mts), an increase of 0.27 Mts or 1.8 per cent compared to the previous record of 15.33 Mts set in 2012/13.

Alumina continues to be the main trade throughput. Exports of alumina reached a record throughput of 10.66 Mts, which represents 68.3 per cent of total port trade and which is exported over two berths by Alcoa of Australia (the largest exporter) and BHP Billiton Worsley Alumina. The port also imports caustic soda (1.31 Mts) which is required in the alumina

Regional Report


refinery process. Compared to 2012/13, several exports increased, including woodchips, iron concentrate and copper concentrate. The number of commercial vessel visits was similar to the prior year, at 410, as compared to 414. BPA’s forecast for the Port of Bunbury for 2014/15 remains strong, with the commencement of new grain exports and continuing growth in other cargoes.76

The Bunbury Port Authority forecasts growth of export tonnage of 50% over the next five years and doubling by 2020, generated primarily by the mining sector. Significant investment of $621 million is required to upgrade road and rail links into the Port of Bunbury, such as the Bunbury Outer Ring Road, second railway line from Brunswick to the port, the Coalfields

Highway and the re‐alignment of the Preston River. A Government agency/private sector business consortium has been formed to develop the Greater Bunbury Infrastructure Investment Plan (Roads to Export) to support bids for funding.77

In March 2014 the Federal Government committed $10.8 million to build a waiting bay for road trains to increase productivity at Bunbury Port. Construction of the road train assembly area includes bays for 20 road trains, parking, lighting and fencing, as well as a new intersection on Bunbury Port Access Road and a 200 metre access road. The facility is a prerequisite for opening the Perth-Bunbury heavy vehicle network for all 36.5 metre heavy vehicles. Currently 27.5 metre heavy vehicles are the biggest permitted on the Bunbury to Perth route, partly because there is nowhere for longer vehicles to be broken down into smaller loads. The new road train assembly area will allow for formal consideration of the proposal to extend the network to all heavy vehicles along the length of the Perth to Bunbury route.78

A $1.44 million terminal expansion project at the Busselton airport which commenced in July 2014 was completed in December 2014. This has increased the airport's efficiency, operational capacity and passenger comfort. Improvements include a new check-in area, new security screening point, a new café and a refurbished 90 seat departure lounge. The project has been a collaborative effort made possible by $516,300 from the State Government's Regional Airport Development Scheme, jointly funded by Royalties for Regions and the Department of Transport, as well as $500,000 from the Australian Government's Federal Community Development Grant Scheme, with the City of Busselton contributing the remaining funds.79

Wheatbelt Region

The Wheatbelt is home to approximately 75 000 people, making it the third most populous region in the state, with the population widely dispersed. The main service centres are in the shires of Northam, Narrogin, Merredin and Moora.80 Whilst the Wheatbelt is WA’s most significant agricultural region, its economy is varied.

Rock lobster dominates the fishing industry on the Central Coast; however there are significant opportunities for both inland and coastal aquaculture. Commercial production and export of freshwater marron and yabbies has been successful for several years, with aquaculture considered as having major potential for investors.81 Gold, nickel and iron ore are mined in the eastern parts and mineral sands and other minerals in the west. Other industries include aviation, construction and renewable energy.82

The potential of the transport, logistics and manufacturing industry in the Wheatbelt stems from its location, being close to Perth and to key areas of primary production. Well-developed transport links, the affordable cost of industrial land, and already designated industrial

http://www.transport.wa.gov.au/aviation/regional-airports-development-scheme.asp

http://www.busselton.wa.gov.au/Developing-Busselton/Major-Projects/Busselton-Regional-Airport

Regional Report


precincts make it ideal for servicing the mining and agricultural industries, while also being well placed to access metropolitan markets.83

The region has well developed transport links, with most major highways and rail routes to Perth passing through it. It has 35% of the State’s roads with easy access to the Port of Fremantle and regional ports at Geraldton, Bunbury, Albany and Esperance. A range of private air charter services is available. Daily passenger rail services operate on the main east-west line and a variety of passenger road coach services exist.84

A trial of enhanced services on the AvonLink train, between Perth and Northam, commenced in December 2014. The Royalties for Regions investment of $6.575 million over three years for the AvonLink Enhancement Project has seen extra return services introduced on the route and will include additional feeder services, improved ticketing and increased marketing.85

There are over 35 air facilities in the Wheatbelt region and key aviation industries include training, general aviation, tourism and use of air facilities by emergency services (including Royal Flying Doctor Services and Fire and Emergency Services Authority). Aviation training is centred in airports at Cunderdin, Merredin, Northam and Wyalkatchem and includes pilot and engineering training, whilst tourism activity such as skydiving, ballooning and gliding is centred at Northam, York and Beverley.86

Western Australian growers delivered the fourth largest harvest in history last year, with 13.52 million tonnes received. The total is around 3 million tonnes more than CBH’s ten year average. The year also saw rail records broken; with the largest ever amount of grain being moved by rail across WA during November, moving 693,108 tonnes. CBH also transported 8,531,430 tonnes from terminal to rail from October 2013 to September 2014; this was the all-time season record.87

In May 2015 the State’s freight rail network operator Brookfield Rail agreed on a new interim rail access agreement with CBH, ensuring continuity of rail access for grain growers across Western Australia. The agreement replaces the existing interim agreement, which expired at midnight on Thursday 30 April. The new agreement will operate until December 31, 2015, unless Brookfield Rail and CBH can reach a long term agreement earlier, which is the focus of ongoing negotiations.88

http://www.transwa.wa.gov.au/Services/AvonLink.aspx

Regional Report


Reference – End Notes

1 Department of Regional Development website www.drd.wa.gov.au





6 Ports Handbook Western Australia 2014, Department of Transport

7 www.mediastatements.wa.gov.au/Pages/Barnett/2015/03/


9 Economic Development Opportunities for Gascoyne Region associated with Resource Sector

Investment Expansion, Gascoyne Pilbara Project January 2012, Gascoyne Development Commission 10

Gascoyne Development Commission website; www.gdc.wa.gov.au 11




Goldfields Esperance: a region in profile 2014 15

Goldfields Esperance: a region in profile 2014 16

Goldfields-Esperance Strategic Development Plan 2011-2021, Revision 1, July 2012 17

Goldfields-Esperance Strategic Development Plan 2011-2021, Revision 1, July 2012 18

Ports Handbook Western Australia 2014, Department of Transport 19

Goldfields-Esperance Workforce Development Plan 2013-2016 20

Goldfields-Esperance workforce development plan 2013-2016 Executive summary 21

Industry consultation 22

Business News feature – Ports and Transport Review, 13 April 2015 23

Goldfields-Esperance Development Commission Major Projects Summary 2014/2015 24





Regional Development Australia Great Southern WA Summary Regional Priorities 29

Regional Development Australia Great Southern WA Summary Regional Priorities 30

Great Southern Development Commission/Great Southern Profile 31

Great Southern Development Commission website, www.gsdc.wa.gov.au 32


Kimberley workforce development plan 2014–2017 34

Regional Plan, Regional Development Australia, Kimberley 2013-2016 35

Broome’s growing economic future servicing Korean-built mega structures, www.abc.net.au 29-5-15 36 Industry consultation 37





Industry consultation 42

Regional Development Australia, Midwest Gascoyne 43

Mid West Development Commission website 2014 www.mwdc.wa.gov.au 44





Brookfield Rail website: www.brookfieldrail.com.au 49




Mid West Development Commission website 2014 www.mwdc.wa.gov.au [i] Geraldton Airport Master Plan to 2030 (Update February 2015)

http://www.mediastatements.wa.gov.au/Pages/Barnett/2015/03/Regional-airports-share-in-$25-million-.aspx

http://www.abc.net.au/

Regional Report


53 Brookfield Rail website www.brookfield.com.au

54 Gindalbie Metals Pty Ltd website, www.gindalbie.com.au

55 Miningoilgas website www.miningoilgas.com.au

56 Peel: a region in profile 2014, Department of Regional Development




60 Peel Region Investment Opportunities June 2012

61 Peel Investment Series, 2014-15, Peel Development Commission

62 Pilbara Development Commission website: www.pdc.wa.gov.au





67 Ports Handbook Western Australia, 2013, Department of Transport

68 Department of Regional Development website

69 Karratha Airport, February 2014

70 Woodside website www.woodside.com.au

71 Chevron website: www.chevron.com

72 Chevron website: www.chevron.com

73 South West Regional Blueprint, Draft February 2014

74 South West Regional Blueprint, Draft February 2014

75 Significant Resource Projects in Western Australia – March 2014, Department of State Development


77 South West Development Commission website – www.swdc.wa.gov.au

78 West Australian Newspaper, 27 March 2014


80 Department of Regional Development and Lands, Wheatbelt, A region in profile 2011 (updated 2013)

81 Wheatbelt Development Commission website: www.wheatbelt.wa.gov.au

82 Department of Regional Development and Lands, Wheatbelt, A region in profile 2011 (updated 2013)




86 Wheatbelt Workforce Development Plan 2013-2016

87 CBH website

88 Brookfield Rail website

Documents

Logistics Industries ENVIRONMENTAL SCAN · Source: WA Economic Profile April 2014 ... PortLink - an inland freight initiative to link WA’s regional ports and proposed Oakajee port