A $75 billion resources construction boom is poised to again transform the WA economy.
This week’s announcement by Rio Tinto that it had given the green light to a $3.5 billion iron ore hub was the latest in a string of massive new projects that are under way, shovel-ready or in advanced planning that will deliver tens of thousands of jobs.
Industry heads are confident the impending infrastructure splurge will be more manageable than the post-global financial crisis boom but warned a skills shortage and wage spiral were possible.
New mines by rivals Fortescue Metals Group ($1.7 billion) and BHP ($4.7 billion) have been ticked off and the iron ore sector could expand further if the $3 billion Balla Balla project gets the go-ahead from its New Zealand backers.
The new iron ore developments come as the State’s lithium expansion gathers pace, led by a $600 million expansion of the enormous Greenbushes mine — the world’s biggest deposit of the ingredient critical to producing lithium-ion batteries powering electric vehicles around the globe. The joint-venture owners of Greenbushes will use hard-rock lithium to feed two new processing plants at Kwinana and Kemerton.
Mineral Resources will spend $610 million for its Wodgina lithium concentrate plant near Port Hedland while $800 million will go on the Mt Holland lithium mine and refinery near Southern Cross.
WA’s gas industry has shaken off jitters from the oil price shock in 2016 and announced aggressive expansions.
The much-vaunted Browse development, which Woodside spearheads, could finally be tapped under a $28 billion plan. The nearby Scarborough field will have $15 billion spent on it.
Chevron is throwing more money at the Gorgon LNG plant, where a subsea expansion requires $5.1 billion and the reinjection of carbon into reservoirs is costing $2.5 billion.
The State’s gold sector will get bigger with the addition of the $621 million Gruyere gold mine.
Value-added projects in advanced planning include Perdaman Resources’ $4.5 billion urea plant, slated for the Burrup Peninsula, and BHP’s Nickel West mine and smelter expansion, which is worth $1 billion.
Chamber of Minerals and Energy boss Paul Everingham said $75 billion was an amount that any jurisdiction would welcome but represented a less intensive investment than the $320 billion spent in the 10 years to 2015. The next phase of economic expansion would be more “orderly and manageable”.
“Our mining and energy companies are better prepared for the proposed investment,” he said. “There will be thousands of jobs associated with these projects. Too many for just Western Australians to fill. Industry is working … to ensure that regulatory approvals for these projects are processed in a timely manner and that the industry can access potential employees from a wide area.”
Premier Mark McGowan said the number of big projects coming online indicated renewed confidence in WA. “Our number one priority is ensuring these projects create jobs for Western Australians, and I’ve made it clear to the resources companies that we want to see more employment and training opportunities for locals,” he said.