1 The Pilbara in Context 7. 2 The Economic Context 8. 3 A Mandate for Investment Key Local Plans Resource Sector Investments 16

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1 PILBARA REPORT 2012 P I L B A R A

2 Contents Your Invitation 2 Summary of Key Investment Opportunities 4 1 The Pilbara in Context 7 2 The Economic Context 8 3 A Mandate for Investment 13 4 Key Local Plans 14 5 Resource Sector Investments 16 6 The Regional Investment Opportunities Analysis 18 7 Funding the Future 24 8 An Investment Transformation 25 9 The Enabling Environment Economic Diversification Perspectives Housing and Land: Investment Prospectus Power: Investment Prospectus Water: Investment Prospectus 34 Contacts for further investigation 36 PILBARA REPORT

3 Your Invitation This Prospectus outlines a selection of major investment opportunities in Western Australia s Pilbara region. Read on to explore ways to capitalise on the prosperity and growth of this powerhouse region that is experiencing unprecedented demand for its products, its people and its environment. Share in or lead programmes that help to realise this region s potential. Add value through investment of capital, expertise, knowledge and personal commitment. A snapshot of opportunities within the Pilbara is described here and more comprehensively in the Pilbara Report This is your invitation to take advantage of a wide variety of infrastructure investments throughout this dynamic region. In Western Australia had the highest per capita gross state product of $93,593, some 50% higher than the national average of $62,424, with mining, largely in the Pilbara, representing 33% of the gross state product. The gross regional product of the Pilbara has more than doubled since to over $14 billion in The region is responsible for a major portion of the production, value, exports and investments of extraction industries commodities, particularly iron ore and liquefied natural gas (LNG), in WA and Australia. In Western Australia was placed 11th across 93 global jurisdictions as a destination of choice for investment in the mining industry by the internationally respected Fraser Institute. This level of international regard augurs well for the long term future of mining in the Region and for the regional economy as a whole. In November 2009 the Western Australian Government announced Pilbara Cities initiative offering a clear mandate for investment in the Pilbara by committing to a $1.2 billion Pilbara Cities Vision that was formally enacted through legislation in December Infrastructure Australia s report to the Council of Australian Governments (COAG) in June states with respect to the Pilbara: The further development of the Pilbara is a vital initiative for the nation. The opportunity for industry, and the Australian, State and local governments to work to increase the wealth created from this region cannot be missed. It is clear that the development of major infrastructure, particularly ports, transport and freight corridors and energy and water to support this growth requires a holistic response. However, as is apparent from the pressures currently being experienced in the Pilbara, consideration must also be given to supporting social and community infrastructure. Early projects led by this government catalyst have started a fundamental transformation of the look of the major townships and extensive planning is now in place to deliver regional cities and major regional centres throughout the Pilbara. The demand from extractive industry expansion has driven housing prices and rentals to unprecedented levels, some four times metropolitan Perth. Moreover, essential infrastructure including power, water and waste water services have reached capacity and present challenges to achieving the aspirational population targets identified in the Pilbara Cities Vision. Port upgrades including common user facilities are critical elements to be addressed. Suitably sized direct port access roads and effective road transport connections for freight movement are necessary to underpin economic activity. The huge growth in resource sector activity has led to a dramatic increase in the workforce required in the Pilbara, resulting in an accommodation shortage. Consequently, the region has experienced a boom in airport activity through the significant increase in the number of flyin-fly-out (FIFO) workers and the multitude of support services staff delivered to mining sites. Through this prospectus, Regional Development Australia Pilbara is adding its voice and catalytic capabilities to present, to the private and public sectors at State, Federal and international levels, an invitation to invest in a broad spectrum of asset classes that are not only vital to future growth but can also offer sound returns on investment. The Pilbara presents a heightened investment opportunity at present. The international investment advisory service Preqin 2 indicated in its April bulletin that long term infrastructure investment is viewed favourably in these times of global uncertainty. Large economic assets like airports and roads often have built-in monopolistic characteristics. Likewise certain infrastructure projects such as utilities invariably offer low elasticity of demand, almost ensuring a market. The scope and scale of development will be determined by all of the components of the enabling environment. That is, in order to enable sustainable growth and development, key aspects of the environment need to be considered, namely political, economic, social, cultural, technological, (natural) environmental and legal factors. Specifically for the Pilbara, this includes legislation; processes; institutions (and their roles); the cost structure for households and businesses; and, sufficient investments in construction, housing, infrastructure and economic diversification. 1 Communicating the Imperative for Action, Infrastructure Australia report to Council of Australian governments, June This investment prospectus provides an insight into the opportunities that prevail in the dynamic Pilbara region, the nation s powerhouse. We welcome your enquiries. Collene Longmore Chairperson, Regional Development Australia Pilbara Diane Pentz Chief Executive Officer Regional Development Australia Pilbara 2 PILBARA REPORT 2012 PILBARA REPORT

4 Summary of Key Investment Opportunities $9 billion Land and Housing $26 million Waste management The Pilbara Cities growth plans 3 indicate a medium term requirement for more than 15,000 dwellings, predominantly in Karratha and Port Hedland to accommodate the projected residential population in these two locations. If the total demand for dwelling units forecast to 2015 is satisfied (8,614) this will require an average of 1,435 dwelling units to be brought to market each year. The magnitude of the land and housing programme required to meet the Pilbara Cities vision is estimated to be in the order of $9 billion, delivering approximately 35,000 new dwelling units through to Critical to the long term growth of the region is the establishment of a suitable Class IV waste management and hazardous waste disposal facility. Sites in the Shire of Roebourne and Town of Port Hedland are currently under investigation for this purpose. A facility of this nature carries an estimated development cost of $18 million. The Pilbara Planning and Infrastructure Framework also acknowledges the requirement to develop a system of townsite transfer stations and investigate recycling options in service hubs. $1.69 billion Power supply Major changes to the existing North West Integrated System (NWIS) are imminent. An immediate additional supply source of at least 100MW is required to meet short term demand through to Medium term demand estimated to be in the order of 350MW will require investment of at least $930 million in power generation capacity. Presently Horizon Power is required to wheel its power across systems owned by others with varying transmission capacities. Transmission system upgrades and interconnections require both short and medium term investment estimated at $760 million. $350 million Airports Airports throughout the region are experiencing a dramatic rise in patronage as a result of resources sector activity and a reliance on FIFO workers. Upgrades are required at all major locations to handle increased passenger loads. Karratha Airport is handling over 900,000 passengers per annum and critical passenger parking, terminal and airside improvements are valued at more than $100 million. The Port Hedland stage 2 development in the Master Plan, scheduled for the period , is for further terminal expansion and apron expansions, plus a major development to upgrade a taxiway to Code E. Essentially this means the airport will be able to accommodate larger aircraft and, thus, longer flight services. This stage is valued at $49.4 million. Newman airport requires extensive expansion including a new terminal and a second runway (an estimated $60 million is required immediately). Onslow airport also needs upgrading; cost estimates for these works are currently being prepared. $1.5 billion Water supply >$500 million Ports The schemes servicing Karratha and Port Hedland are already at capacity and new supply is urgently needed to meet burgeoning demand. Current projections indicate the need for in excess of $1.5 billion for capital investment in the West Pilbara Water Supply Scheme with almost half of this sum required in the period to A new desalination plant of up to 15GL on the Burrup Peninsula is promoted as the most reliable short term source focused on Karratha, supplemented by the development of water extraction from the Bungaroo Valley (noting that this system requires extensive upgrading). Significant investment opportunities lie in this essential services sector. Port expansion programmes led by major resource companies are ongoing, yet there is some uncertainty around which players will proceed with developments in the Port Hedland outer harbour and the Anketell Port project. A new Pilbara Port Authority will be created to oversee significant growth at Port Hedland, Dampier, Anketell, Cape Lambert and Cape Preston. Port Hedland s Lumsden Point has been identified as a possible location for a marinebased Common User Facility (CUF) consisting of wharves, lifting lay down areas, and repair, maintenance and load-out facilities. The project would be modelled on the successful Australian Marine Complex CUF at Henderson (Perth), enabling companies to work closer to their developments. Funding of $5 million has been committed to undertake a feasibility study for the CUF. $65 million Waste water management >$1 billion Roads The second Karratha Waste Water Treatment Plant (WWTP) plant is at capacity and needs an estimated $30 million of works for upgrading to cope with increased flows. An $8 million temporary Packaged Treatment Unit has been installed to cope with immediate demands from an additional 1,250 housing lots. $106 million has been allocated for the relocation of the Port Hedland WWTP to South Hedland, including the cost of returning treated effluent to Port Hedland for re-use in irrigation. These works have the potential to release land (up to 2,500 lots) for development. Further waste water conveyance improvements are required in Port Hedland and Newman at an estimated cost of $35 million. Significant road transport improvements are required, including the upgrade of the North West Coastal Highway (NWCH) to national highway status, thus, creating a new major supply chain link. Improved port access roads will be required and additional east west linkages connecting inland towns such as Newman, Tom Price, Paraburdoo and the myriad of mine sites to the NWCH and the ports. Itemised improvements include road access around Wedgefield and duplication of the Redbank Bridge in Port Hedland, and the Karratha western bypass to Dampier road. A new coastal road connection from Karratha to Anketell is estimated at $200 million. 3 Karratha City of the North Growth Plan, Port Hedland Port City Growth Plan 4 PILBARA REPORT 2012 PILBARA REPORT

5 1 The Pilbara in Context Encompassing 507,896 square kilometres, the Pilbara spans the breadth of central Western Australia from the coast to the Northern Territory. The region is the size of France, however it currently has a population of only some 60,000, generating over 20% of Australia s export earnings with just 0.2% of the population. The Pilbara grew from a few thousand in 1966 to around 41,000 in 2006 and an estimated 55,000 in Under the Pilbara Cities initiative, the overall resident population of the region is planned to grow to more than 140,000 by Driven primarily by progressive expansion in the mining sector, this aspirational population increase represents an average annual compound growth rate of around 5%. The Pilbara also hosts a substantial non-residential population made up generally of industry fly-in-fly-out (FIFO) construction and production workforces. In 2010, the Pilbara s resource related FIFO workforce was estimated at 15,500 and is expected to rise to around 33,700 by The growth rate shown in Figure 1 (right) indicates an exponential rise in the resident population through to A flat line growth of 3,500 people moving to the Pilbara each year would be necessary to achieve the planned target of 140,000 people. This targeted growth rate must be supported by ongoing economic activity and diversification, together with the provision of infrastructure, community services and affordable housing within Pilbara communities. Figure 1: Projected Population Increase in the Pilbara (Source: Pilbara Planning and Infrastructure Framework) Population 160, , , ,000 80,000 60,000 40,000 20,000 Past Growth PICC (business as usual) Pilbara Cities (aspirational) Year 1.1. EMPLOYMENT An industry estimate of employment growth from the Pilbara Industry Community Council (PICC) 4 puts the regional employment growth rate at 28% between 2010 and The PICC estimates that FIFO employment will increase by 83% over the same period, and by a further 23% to The majority of the minerals and energy workforce required over the coming years will be required for projects located in the Pilbara: 34,000 in 2012 and 21,000 in 2015 (above 2009 workforce). This would be a 65% increase on the 2009 Pilbara workforce by This estimated growth indicates a continuation of the upward trend in employee numbers shown in Figure 2 (right). Employment Sector Figure 2: Employment Composition Comparison between Pilbara and whole of WA (Source: Developed from ABS 2006 Census - Pilara region and WA State employment data) Export/driver (mining) Retail Consumer services Producer services Knowledge intensive consumer services Knowledge intensive producer services Employment (%) WA Pilbara 4 Regional Development Australia - Preliminary Pilbara Regional Plan - August PILBARA REPORT 2012 PILBARA REPORT

6 2 The Economic Context The contribution of the Pilbara to the Western Australian economy is growing, and in turn, the Western Australian share of the Australian economy is increasing. The Pilbara s contribution already exceeds all other regions by 50% on a per capita basis. For the financial year ending June 2010 the State of Western Australia (WA) had a recorded Gross State Product (GSP) of $188 billion. Western Australia makes up 15% of Australia s Gross Domestic Product and the contribution is set to increase. As a consequence, demand for labour in the State has been strong, resulting in solid employment and earnings growth, and an enviable unemployment rate that is almost the lowest in the nation. As shown in Table 1 (below), Gross State Product growth was 4.75% in 2011, the second highest in the nation, and is forecast at 4.25% in both and In April 2012, WA was rated the best performing State in the nation. 2.1.THE RESOURCES SECTOR IN WESTERN AUSTRALIA The substantial pipeline of investments in the resources sector continues to underpin healthy levels of economic activity and the prospect of strong export growth in the future. According to Deloitte Access Economics Investment Monitor (as at September 2011) the total value of expected business investment in WA was $268.4 billion. Projects under construction valued at $84.8 billion represent more than a quarter of the national total. The pipeline of projects (those listed as committed or under construction ) total $137.4 billion, representing over a third of the national total. Over the past five years, private new capital expenditure by the resources industry has grown on average by 21%. Western Australia attracted the bulk of mineral and petroleum exploration expenditure in Australia in , drawing in 54% and 72% respectively. Table 1: Key WA Statistics 08/09 Actual 09/10 Actual 10/11 Budget 11/12 Estimate 12/13 Estimate 13/14 Estimate Gross State product (GSP) and Selected Components % % % % % % Real Gross State product growth Real State final demand growth Business investment growth Dwelling investment growth Public investment growth Key economic Statistic Forecasts Employment growth (% p.a.) Unemployment rate (%) Wage price index growth (% p.a.) Av. weekly earnings growth (%.p.a.) State population growth (% p.a.) Other key economic forecasts and assumptions Oil price (US$ per barrel) $US / A$ (cents) Iron ore price ($US per tonne) Iron ore royalties (A$ m p.a.) Petroleum royalties (A$ m p.a.) The substantial pipeline of investments in the resources sector continues to underpin healthy levels of economic activity and the prospect of strong export growth in the future. 8 PILBARA REPORT 2012 PILBARA REPORT

7 2.2 THE ECONOMY OF THE PILBARA Estimated Gross Regional Product (GRP) of the Pilbara in was over $7 billion. By the Pilbara s GRP was over $12 billion, an increase of some 70%. In , as shown in Table 2 (right), GRP was estimated at $14.04 billion - another substantial increase, with growth rates exceeding those in the fast growing Asia region. The Pilbara is responsible for a major portion of the production, value, exports and investments of extraction industries commodities, particularly iron ore and liquefied natural gas (LNG) in the state and Australia. The Pilbara accounts for almost two thirds of the commodity exports of the State by value, which is almost 20% of the total value of merchandise exports of Australia 5. Table 2: Pilbara Economic Structure and Contribution to the Economy of WA INDICATOR PILBARA REGIONAL WA WESTERN AUSTRALIA Gross Regional Product ( ) Gross Regional Product ($millions) , ,600 % of State Total GRP per capita ($) 342,498 84,109 78,275 Source: Department Regional Development and Lands Agriculture ( ) Total Agricultural Production (value) 67,094,134 6,800,536,760 7,176,183,742 Source: Australian Bureau of Statistics Regional Commodity Production ( ) Value ($millions) 80, , ,164 % of State Total Source: Department of Mines and Petroleum with further estimates by the Department of Regional Development and Lands *Regional sub-totals exclude petroleum Petroleum Value ($millions) 21,293.2 % of State Total 29.9 Forestry ( ) Total Production ($ Value) 0 82,797,000 93,136,000 % of State Total Source: Forest Products Commission (previously CALM) Fishing ( ) Total Catch by Value ($ 000) 9, , ,972 % of State Total Total Catch by Weight (tonnes) 2,264 24,039 25,425 Source: Department of Fisheries INDICATOR PILBARA REGIONAL WA WESTERN AUSTRALIA Manufacturing ( ) Number of Locations 104 2,227 9,982 % of State Total Number of Employees ,207 74,319 % of State Total Turnover ($millions) 2, , ,047.5 % of State Total Source: Australian Bureau of Statistics and the Department of Regional Development and Lands Building and Construction ( ) Total Approvals (value) 1,080,729 4,070,557 13,107,194 % of State Total Total Non-Residential Approvals ($ 000) 790,660 1,852,787 6,134,375 % of State Total Residential Building Approvals ($ 000) 290,066 2,217,770 6,972,823 % of State Total Average Residential Building Approval (value) $457,517 $277,951 $277,614 Source: Australian Bureau of Statistics Retail ( ) Estimated Retail Turnover ($millions) , ,435.9 % of State Total Source: Based on ABS State Retail Turnover. Regional estimations by RDL Tourism ( ) - Based on three year average Nº visitors Domestic ( 000) , ,487.6 Nº visitors International ( 000) ,083.5 Exp domestic ($millions) , ,100.3 Exp international ($millions) ,672.0 Source: Tourism WA with further estimates by the Department of Regional Development and Lands. Totals may not add due to rounding. *Sum of regional averages 5 Regional Development Australia - Preliminary Pilbara Regional Plan - August PILBARA REPORT 2012 PILBARA REPORT

8 3 A Mandate for Investment The region 6 is primarily known for iron ore and petroleum products, and is responsible for over 95% and 99% respectively of exports of these commodities from Western Australia. The quantity of iron ore production up to 2010 is shown in Figure 3 (right). In the Pilbara s commodity production was valued in excess of $80 billion comprising iron ore (68%), crude oil (15%) and LNG (11%). This represents 80% of the total state production 7. The Pilbara services the offshore Carnarvon Basin, Australia s largest known oil and gas reserve that earned $22.8 billion in 2010 (21% of WA s total mineral s and petroleum value). This represents 97% of Western Australia s petroleum production (crude oil and condensate, LNG, natural gas and LPG) in Up until recently, all LNG from Western Australia originated from the Northwest Shelf Venture s (NWSV) project at Karratha. In , LNG reported output from the NWSV increased by almost 8% to 17 million tonnes and the value of sales rose by 25% to $8.7 billion. Figure 4 (right) illustrates the significance of minerals and petroleum in the Pilbara, which represents more than half the State value. The Pilbara has the second largest gold mine in Australia. Copper and manganese are also being mined. Deposits of nickel and uranium may be developed in the future. The Pilbara has the second largest solar salt fields in the world behind China (with large commercial ventures operating out of Onslow, Dampier and Port Hedland). The Pilbara produced roughly 15% of the value of the state s pearl production at $13.5 million in Million of tonnes Figure 3: Iron Ore Quantity up to 2010 (Source: DMP and ABARES) Rest of Australia Western Australia Figure 4: Value of Minerals and Petroleum by Region in WA: (Source DMP) 5% 22% 3% 2% 9% 0.5% 2% 57% Pilbara State Offshore Petroleum Commonwealth Offshore Petroleum Peel Mid West Wheatbelt Goldfields-Esperence Other The Pilbara region of Western Australia plays an important role in the economic development of the nation and is a principal driver of Western Australia s growth. The Pilbara has been experiencing rapid economic growth in recent times and this is expected to continue. Consequently, the Pilbara generates strong employment in the region along with significant indirect employment in Perth and other parts of Australia given that the bulk of the workforce operate on a fly-in/fly-out basis. The mining activity and employment demand is placing strain of the existing economic and social infrastructure 8. With this demand comes a myriad of investment opportunities. The launch of the WA Government s Blueprint for Pilbara Cities in November 2009 by the Premier heralded the commitment to a new Pilbara. The initiative has been generally well received across the Pilbara and wider community, the resources sector and other major stakeholders. The creation of the Pilbara Cities Office within the Department of Regional Development and Lands has been coupled with a range of detailed planning activities, in particular, the development of the Pilbara Planning and Infrastructure Framework and the Pilbara Infrastructure Priorities Report. (These were produced by the WA Planning Commission and provide an agenda for the physical development of the Pilbara). The essence of the Premier s announcement was that Karratha and Port Hedland would become major cities of the future under a ground-breaking State Government initiative to encourage more people to live and settle in the Pilbara. The Premier stated that the framework was now in place to transform the region by creating modern higher density centres, supported by all the services and facilities enjoyed in other Australian cities. Funding and resources from Federal, State and local governments as well as private sector investment, would bring a series of important infrastructure and community amenity upgrades to key towns in the Pilbara. The Pilbara Cities Office has initiated or assisted in the launch of over one hundred projects since its establishment. Its mandate is to coordinate a holistic approach and lead the development New schools and TAFEs; hospitals and medical centres; leisure and entertainment facilities; shopping and retail precincts; employment and indigenous enterprise opportunities; large-scale land releases; and affordable living initiatives, all supported by significant improvements and upgrades to energy, water and waste management services are part of the blueprint. of strategic projects; collaborating with a range of government, industry and community stakeholders to transform the region in a sustainable way and offer housing affordability, infrastructure upgrades, new health and education facilities and local business development. The Pilbara Development Commission, the Pilbara Cities Office and the WA Planning Commission/Department of Planning are at the forefront in working with the Pilbara s Regional and Local Governments to align and connect their respective plans and strategies. 6 Regional Development Australia - Preliminary Pilbara Regional Plan - August Western Australian Economic Profile, February 2012, Department of State Development 8 Communicating the Imperative for Action, Infrastructure Australia report to COAG, June PILBARA REPORT 2012 PILBARA REPORT

9 4 Key Local Plans 4.1 SHIRE OF EAST PILBARA The Shire of East Pilbara became the largest Shire in the world when created through an amalgamation in 1972, and comprises an area of over 379,571 km² (larger than the State of Victoria). Its population is estimated to be 10,500, with major industries in the Shire of mining, pastoral and tourism. The main townsites are Newman, Marble Bar and Nullagine, and the Shire s Administration Centre is located in Newman. The Shire area also contains numerous Aboriginal communities including Jigalong, Punmu and Parngurr. Aboriginal communities are also located in Nullagine (Irrungadi community) and Marble Bar (Pipunya and Goodabinya communities). The town of Newman is proposed under the Pilbara Cities initiative to become a sub-regional centre of 15,000 people by The Pilbara Planning and Infrastructure Framework describes Newman as the major service support hub for a number of mining operations in the East Pilbara and as a sub-regional service and tourism centre. There are opportunities to develop the town as a sub-regional distribution centre, which is located strategically along the Great Northern Highway and services the needs of the indigenous settlements located throughout the East Pilbara. There are excellent opportunities to develop a tourism industry (gateway to Karijini and Karlamilyi National Parks and the Canning Stock Route); supply chain completion; and a hub for a horticultural industry based on mine de-watering. 4.2 TOWN OF PORT HEDLAND The Town of Port Hedland has two of the main residential centres in the Region, Port Hedland and South Hedland and the remote aboriginal community of Yandeyarra located about 130 km south of Port Hedland. It comprises an area of 11,844km², with an estimated population of 20,200. There are also pastoral stations located throughout the area. Both Port and South Hedland provide a range of community services, including cultural, recreation and shopping facilities. The population of Port and South Hedland, as the Pilbara s Port City, is expected to grow to 50,000 by The main industries are iron ore processing and export, salt production from extensive evaporation ponds for export, shipping of manganese and other minerals and livestock production. The Port Hedland Port Authority (PHPA) is the largest tonnage port in Australia and the largest iron ore and bulk mineral export port in the world. In the 2010/11 year the Port facilitated trade of 199 million tonnes, worth over $40 billion. There are extensive local government plans and strategies including the Pilbara s Port City Growth Plan, Port Hedland Hotspots Report, South Hedland Town Centre Development Plan and Hedland s Future Today 2010 that describe the development priorities for Port and South Hedland in detail. 4.3 SHIRE OF ASHBURTON With an area nearly half the size of Victoria (105,647km²), the Shire has some of the world s largest open cut mines, pastoral leases and cattle stations and a thriving fishing industry all set against a beautiful and ancient arid tropical landscape. The majority of the area of the Shire of Ashburton is divided into pastoral properties amongst which are the towns of Onslow, Pannawonica, Paraburdoo and Tom Price. The majority of the Shire s population live in these four towns. The Shire has an established salt industry, based at Onslow which is also to be the home of the recently announced $29 billion Chevron Wheatstone Project. This project is expected to create 6,500 jobs at peak construction and 300 new operational jobs. The project announcement was heralded as an exciting milestone in Onslow s history and will see the return of industry and a port near to the area first developed in the late 1800s. Substantial employment and industry participation opportunities for the State and the transformation of Onslow, as well as cementing WA s status as a major global energy supplier, are predicted. This rapid growth poses a number of planning issues, including how to meet critical infrastructure requirements for housing, power generation, water supply, landfill and transport. Key community and public infrastructure will be built or upgraded including the upgrading of the town s water and electricity supplies, road access and community facilities and services. Development of the nearby Ashburton North Strategic Industrial Area as a home for major liquefied and natural gas processing projects and the arrival of new families to support their operations are expected to drive up the population from 700 to 2,200 by 2016, with a total population of around 4,000 by SHIRE OF ROEBOURNE The Shire of Roebourne comprises an area of approximately 15,197km 2, having its offices in Karratha, a modern town that is recognised as one of the major centres in the Pilbara. The Karratha/Dampier settlements are expected to grow to 50,000 as a key Pilbara City under the Pilbara Cities blueprint. There are five other town sites located within a 50km radius, with industry-based settlements at Dampier and Wickham, the historic towns of Roebourne and Cossack, and the coastal retreat of Point Samson. The Shire s resident population is estimated to be 22,900 people or 38% of Pilbara people. The major industries include iron ore export, oil, natural gas, salt, nickel, fishing and tourism. Lying offshore from the Shire is the famous Dampier Archipelago comprising 42 islands, islets and rocks, lying within a 45km radius from the town of Dampier and Point Samson. Coupled with world listed rock art (more than one million petroglyphs have been identified), this area has a natural beauty and considerable tourism potential. The Karratha City of the North Plan aspires to endow the Region with vastly improved infrastructure and amenity, and offer more affordable and diverse styles of housing. This is to be achieved through a three-phase strategy that will guide the development of future housing, open spaces, commercial activities, tourist accommodation, entertainment and retail areas, as well as service infrastructure, transport, education and community facilities. Similar infrastructure planning is now required for Dampier, Roebourne, and Point Samson. 14 PILBARA REPORT 2012 PILBARA REPORT

10 5 Resource Sector Investments 5.1 IRON ORE: EXPANSIONS AND DEVELOPMENTS Pilbara mining company growth targets are large and include: Rio Tinto Iron Ore anticipates an expansion from 220Mtpa to 330Mtpa in 2016; Fortescue Metals Group recently expanded production to 55Mtpa. Further expansions include 120Mtpa in Stage 1 and 220Mtpa in Stage 2 (this will require a new ship loading facility see next point); North West Iron Ore Alliance (Atlas Iron, Brockman Resources and FerrAus) aspires to a capacity of 45Mtpa by 2013; CITIC Pacific anticipates a steady magnetite production of 27.5Mtpa at Cape Preston of which 6Mtpa are pellets; and, Hancock Prospecting s 55Mtpa Roy Hill 1 mine is scheduled to come on line in This will be followed by the company s Central Pilbara project. Committed iron ore projects will increase production capacity by 195Mtpa representing a 2010 value of $22 billion by Proposed iron ore projects would potentially lift export capacity by another 321Mtpa at a 2010 value of $43.6 billion by Note that the progress of Outer Harbour development at Port Hedland and the Anketell Port project are uncertain at present as iron ore companies consider their investment options. 5.2 OIL AND GAS: EXPANSIONS AND DEVELOPMENTS Examples of committed projects are: North West Shelf Venture with the completion of its fifth processing train (4.4Mtpa capacity), the venture can produce 16.3 million tonnes of LNG per year, with export earnings in the vicinity of $10.1 billion in ; Woodside s Pluto Project commenced producing LNG in 2011, with the commissioning of the first LNG processing train with a capacity of 4.3Mtpa. Woodside is planning the construction of a second and third LNG processing train at the Burrup Pluto LNG Park; Chevron s Gorgon Project is developing the Gorgon Gas Fields and is on schedule to produce and export LNG at its processing plant on Barrow Island. The plant will comprise three 5Mtpa processing trains, eventually producing 15 million tonnes of LNG per year. Production is anticipated to commence in 2014 and end between 2054 and 2074; and, Chevron s Wheatstone Project an LNG processing plant is now confirmed to be located at Ashburton North 12 kilometres to the west of Onslow. The plant will initially comprise two LNG trains, each with a capacity of 4.3Mtpa, together with a domestic gas plant. Supplied from the Wheatstone and offshore gas fields, it will eventually have a 15Mtpa processing capacity. Chevron s Gorgon Project - Chevron is developing the Gorgon Gas Fields and is on schedule to produce and export LNG at its processing plant on Barrow Island. The plant will comprise three 5 Mtpa processing trains, eventually producing 15 million tonnes of LNG per year. Production is anticipated to commence in 2014 and end between 2054 and Chevron s Wheatstone Project - an LNG processing plant is now confirmed to be located at Ashburton North 12 kilometres to the west of Onslow. The plant will initially comprise two LNG trains, each with a capacity of 4.3 Mtpa, together with a domestic gas plant. Supplied from the Wheatstone and large off-shore gas fields, this Chevron project will eventually have a 15 Mtpa processing capacity. The total capital expenditure of committed or new projects is $128 billion with projects having a start up date through to Projects under consideration with a start date up to 2016 have a further substantial capital expenditure. 5.3 EXPORTS AND FOREIGN EXCHANGE EARNINGS For and strong export growth is forecast to continue, buoyed by continued expansions in the iron ore sector and the commissioning of the Chevron Gorgon LNG project in Exports are subsequently forecast to grow by a solid 6.5% per annum in and Rapid growth in iron ore and LPG/LNG will drive export growth over the next three years, and new LNG plants will be operational from , bringing gas to the forefront. By , gas exports will have tripled, while sales of iron ore will have almost doubled and will be up 70% compared with PILBARA REPORT 2012 PILBARA REPORT

11 6 The Regional Investment Opportunities Analysis There are a number of major asset classes that go beyond the business as usual development model and which also have an impact that is region-wide. In the rapidly evolving Pilbara landscape new demands and new investment opportunities will present themselves at every turn. The absolute necessities, such as the supply of housing, power and water, are detailed further in sections 11, 12 and 13. There are also societal fundamentals such as health and education services; inspirational community initiatives such as entertainment, sporting and cultural precincts; and, entrepreneurial aspects such as recreational marinas, solar energy and biofuels projects. There is consensus that the time is now and the place is the Pilbara. What is required are visionary investors that can step beyond the boundaries and develop innovative financing and asset packages that will over the next twenty years transform the vision for the region into a reality. The following outlines a portfolio of potential investment sectors. Table 3: Regional investment opportunities Regional initiatives Housing and Land Development Power supply New generation capacity Fully Interconnected transmission system Water supply New desalination plants (Karratha and Port Hedland) New borefield development (Cape Preston) Potable Water Upgrade Port Hedland Waste Water Treatment Plant #2 Karratha Upgrade Waste Water Conveyance Port Hedland and Newman Road developments Northwest Coastal Highway Duplication of the Karratha to Roebourne Road Karratha to Tom Price Road Port Hedland Road upgrade and duplication of Redbank Bridge Karratha Airport eastern access Road NWCH to South Hedland link Road Dampier Port Access Road upgrade - Karratha western bypass Karratha to Anketell/Wickham Coast Road Airport development New Karratha International terminal Karratha Runway upgrade to A300 capacity Enhanced apron standing area New Port Hedland terminal Expansion of Newman Airport terminal and new second runway Onslow Airport upgrade Port development Cape Lumsden Common User Facility Waste management Regional Class IV waste management and hazardous waste disposal facility Marina developments Spoilbank Marina and Residential Precinct in Port Hedland Dampier Marina Investment scale ($) $9 billion $400 million > $600 million $2 billion To be costed $63 million $30 million $36 million To be costed To be costed $300 million $90 million $16 million $22 million $85 million $200 million $55 million $30 million $15 million $40 million $140 million To be costed > $150 million $18 million $176 million $50 million High Profile Locality Specific initiatives Town of Port Hedland Port Hedland Aboriginal Arts & Cultural Precinct South Hedland Community Centre & Library Relocation of the Port Hedland Turf Club Creation of new playing fields in South Hedland Shire of Roebourne Roebourne Community Aquatic Centre Community library GP SuperClinic Karratha Leisure Complex Shire of East Pilbara Town hall/cultural building Upgrade/expansion sewage treatment plant Lions Park redevelopment New Recreation Precinct Shire of Ashburton Tom Price Sporting Precinct Upgrade Tom Price Day Care Facility Tom Price Village Green Development Paraburdoo Community and Sporting Hub Onslow Industrial Estate Onslow Ring Road Opportunities for economic diversification Business Incubators in all 6 major townships Bio-fuels Project Hi-Tech Greenhouse Aquaculture fish farm Fish processing factory Tertiary education developments UWA Pilbara feasibility Study University facility developments (Karratha and Hedland) $40 million $18 million $25 million $8 million $9.5 million $12 million $23 million $16.3 million $40 million $5 million $5 million $50 million $9 million $8 million $28 million $16 million $10 million $10 million $134.8 million $106 million $12 million $12 million $3.6 million $1.2 million $100.7 million $0.7 million $100 million 18 PILBARA REPORT 2012 PILBARA REPORT

12 6.1 LAND AND HOUSING Forecasts within the two Pilbara Cities growth plans 9 indicate a medium term requirement of more than 15,000 dwellings to accommodate the projected residential population in these two locations. Additional dwellings will be required outside of the twin cities, most notably in Newman and Onslow. Short term housing demand in Pilbara towns is shown in Table 4 (right). If the total demand for dwelling units forecast to 2015 is satisfied (8,614) this will require an average of 1,435 dwelling units to be brought to market each year. Data collected from the four local authorities shows the total number of building approvals issued in the 4 years since 2008 to be 3,094; almost 50% short of the forecast supply requirement which some analysts are now saying is significantly underestimated. Housing and land prices continue to be stressed by shortage of supply. In the first quarter of 2012 there were only 18 residential lots offered to the market across the Pilbara. Large land release programs are now being developed and the ensuing challenge, and opportunity, will be to construct suitable dwelling units in a short time frame. Figure 5 (right) indicates the impact of this housing shortage as it affects rental accommodation. Port Hedland is perhaps the hardest hit in terms of supply limitations and price escalation with property rentals reaching as much as $4,000 per week for a high end family home. The Pilbara s Port City Implementation Plan has identified the opportunity for approximately 19,000 dwellings to be delivered on new development sites across a number of growth precincts in Port and South Hedland. The Karratha City of the North Growth Plan identifies sufficient land areas for development for the accommodation of 50,000 people. The plan shows development concentrated north of the Karratha hills with variable densities from R12 to R160. (referring to residential housing density codes, which describe the average land area required for the construction of a dwelling on a block of land). Table 4: Short-term Future Housing Demand in Pilbara Towns ( ) Source: Pilbara Planning and Infrastructure Framework Town Current unmet demand (dwellings) Apparent demand Latest demand Total unmet demand Future demand (dwellings) Additional future demand Low growth High growth Total future demand Low growth High growth Karratha Port Hedland Newman Onslow Tom Price Roebourne Total Figure 5: Average residential property rental and availability in Port Hedland $2200 $2000 $1800 $1600 $1400 $1200 $1000 $800 $600 $400 $200 $ LandCorp regularly produces regional hotspot land supply reports. All major townships within the Pilbara have hotspot reports providing land and housing supply and demand analyses and describe the economic outlook, employment and population projections, and infrastructure provision. Average rental cost Year Number of rentals available POWER The North West Interconnected System (NWIS) capacity is forecast to reduce dramatically in Rio Tinto Iron Ore has constructed a new power station near Karratha to meet its own needs and proposes to discontinue use of its old generation facilities at Dampier and Cape Lambert. These facilities and their generation capacity will be lost to the NWIS. Other Power Purchase Agreements (PPAs) are due to expire in 2012, leaving Horizon Power with uncertain supply and increasing demand. BHP Billiton Iron Ore may construct its own power station in Port Hedland and release its draw from Alinta s Boodarie facility. This capacity may then be available for a Horizon Power PPA. Current supply to, and projected demand from, Horizon Power customers is shown in Table 5 (below). An immediate additional supply source of up to 100MW is required to meet short term demand through to Potential supply options are shown in Table 6. Generation is only one part of the electricity equation and the transmission network is also critical in delivering supply to the customer network. At present the transmission system is a mix of public and private ownership. Horizon Power is required to wheel its power across systems owned by others with varying transmission capacities. There is currently a significant amount of underutilised generation capacity in the Pilbara resulting from numerous self-generation facilities without network connection. If these assets could be accessed to make more efficient use of existing capacity, less new generation investment would be required and line losses could be reduced. A considerable investment in transmission capacity would be required to transport the power to the load centres. It is apparent that there are a number of options and alternative scenarios, but the one certainty is the increasing level of demand and the imperative for an expedient investment decision. The Western Australian government is working to establish the Pilbara Power Project Board to oversee procurement of power from the private sector. It is also discussing the potential to work in collaboration with the resource sector to share the costs of future power infrastructure needs. This will provide an opportunity for private investment. Table 5: Current Supply and Projected Demand (as of 2012 to Horizon Power customers) Source in MW Up to to 2015 Medium term to 2022 RTIO 70* *RTIO generation capacity taken off line ATCO Alinta 45* *Existing PPA expires 2012 Total Supply Demand Shortfall by end of period Table 6: Potential Supply Options from 2012 to 2022 Expansion Options Comment By 2015 By 2022 ATCO Expands Karratha Station to maximum capacity Alinta Needs gas supply and new PPA New generation Unidentified provider 120 Or New PPA Unidentified provider 120 Total supply Shortfall 0 0 With supply certainty reduced to about 80 MW via ATCO after 2012, a further 270 MW is conservatively forecast to be needed by 2022 from a number of alternative options. Figure 6 (below) illustrates predicted power supplies and demand in the absence of private sector investment. Figure 6: Power Supplies and Demand - Pilbara 10 (assuming no private sector investment) Expansion of proposed Port Hedland plant Horizon Port Hedland Alinta Port Hedland (175MW) New power station Port Hedland ATCO power station expansion Expansion of ATCO plant Horizon Karratha (80MW) Demand NWIS peak MW Demand NWIS winter MW Port Hedland power station Karratha City of the North Growth Plan, Port Hedland Port City Growth Plan 10 Source of graph draft PIPF (unpublished) Dept of Planning 20 PILBARA REPORT 2012 PILBARA REPORT

13 6.3 WATER The schemes servicing Karratha and Port Hedland are already at capacity and new supply is urgently needed to meet burgeoning demand. Current projections indicate the need for in excess of $1.5 billion for capital investment in the West Pilbara Water Supply Scheme with almost half of this sum required in the period to Demand in Karratha is expected to rise from around 10GL per annum to as much as 33GL per annum by Port Hedland anticipates a similar escalation in demand bringing total demand to more than 60GL per annum in less than a decade. A new desalination plant of up to 15GL on the Burrup peninsula is promoted as the most reliable short term source focused on Karratha. The desalination plant will need to be supplemented with the development of water extraction from the Bungaroo Valley noting that this system requires extensive upgrading. Significant investment opportunities lie in this essential services sector. Water Corporation are negotiating with Rio Tinto Iron Ore for ongoing supply from Bungaroo and the Department of Water is working to firm up a potential 50GL per annum supply from the West Canning Basin Sandfire project to service Port Hedland. 6.4 WASTE WATER The second Karratha waste water treatment plant (WWTP) plant needs upgrading to cope with increased flows and carries an estimated cost of $30 million. There may be an opportunity to set up a reuse facility to supply treated wastewater for industrial purposes such as dust suppression and road construction. This will reduce the costs of plant upgrades, as well as reducing the amount of new scheme water required. WaterCorp is looking at these options at present. The relocation of the Port Hedland WWTP to South Hedland has the potential to release land (up to 2,500 lots) for development. A significant developer contribution to the project would be required. The project has recently been funded at a cost of $45 million including the cost of returning treated effluent water to Port Hedland for re-use in irrigation. 6.5 WASTE MANAGEMENT There is currently minimal recycling of waste in the region. The next decade will require a comprehensive waste recycling and disposal plan. Also critical is the establishment of a suitable Class IV waste management and hazardous waste disposal facility. Sites in the Shire of Roebourne and Town of Port Hedland are currently under investigation for this purpose. New Energy Corporation is planning a waste to energy plant in the Boodarie Industrial Estate in Port Hedland. This project features a generation capacity of 15MW of energy, a waste capacity of up to 100,000 tonnes per annum and 30 full time jobs. 6.6 CRITICAL TRANSPORT SERVICES Roads The state government is in the process of developing a regional freight strategy which will have a major inter-jurisdictional focus. Concerned solely with freight movements (no passenger transport), the strategy will address supply chain issues throughout the state. At present the Pilbara is served primarily by the Great Northern Highway (GNH) and a new major supply chain link is proposed by upgrading the quality and connections along the North West Coastal Highway (NWCH). The strategy will seek to elevate the status of the NWCH to that of national highway, paralleling the Great Northern Highway though the mid section of the state. Any moves to increase incoming freight handling at ports will require improved port access roads, lay-down, warehousing and logistics centres to be established. These are large and capital intensive developments with a clear commercial opportunity. The need for improved port access roads will extend to beyond the immediate proximity of the ports to feeder roads. It will also see a call for additional east west linkages connecting inland towns such as Newman, Tom Price, Paraburdoo and the myriad of mine sites to the NWCH and the ports Ports Extensive port development is planned including expansion to the outer harbour at Port Hedland and the development of Anketell Port to service the $5.7 billion Aquila Resources Project and other parties. A new Pilbara Port Authority will oversee significant growth at Port Hedland, Dampier, Anketell, Cape Lambert and Cape Preston. A Common User Facilities (CUF) North West Report (April 2011) 11 has been prepared to identify potential locations and the type of facilities and infrastructure needed to support the growth and development of the oil and gas, minerals, defence, housing, building and construction industries. A CUF, consisting of wharves, lifting and lay down areas, repair and maintenance, and load-out facilities, will enable companies to work closer to their developments. This is necessary to meet the increasing demand for such infrastructure as more resource projects are initiated. The facility would also have significant economic diversification potential encouraging the development of local industries to service these projects. Port Hedland s Lumsden Point has been identified as a possible location to develop a marine-based CUF. The project would be modelled on the successful Australian Marine Complex CUF at Henderson (Perth). The Pilbara Cities Office has committed $5 million to undertake a full feasibility study for the CUF Airports A State Aviation Strategy is currently being developed, driven by the rapid growth of the resources sector and its reliance on FIFO services. The Strategy will provide a policy framework and clear direction for investment in aviation infrastructure and services in Western Australia. This will set the scene for private sector investment over the medium to long term. Some specific projects are outlined below. Port Hedland International Airport Port Hedland International Airport accommodates flights to and from Perth, Karratha, Broome, Darwin, Brisbane, Melbourne and Bali. The main passenger transport aprons can accommodate up to 5 aircraft under a power in power out arrangement (meaning that the aircrafts park at the airport and depart under their own power, without use of any towing vehicle). Current passenger numbers are in the vicinity of 300,000 per annum with forecasts predicting a rise to between 460,000 (low growth) and 595,000 (high growth) per annum by A master plan for the redevelopment of the airport has been prepared by the Town of Port Hedland and proposes two stages of redevelopment, totalling in the vicinity of $90 million. This upgrade and expansion programme is only partly funded and presents a significant investment opportunity. Karratha Airport The Shire of Roebourne s Karratha Airport master plan 2009 is currently under review. This airport is already exceeding passenger traffic levels forecast for 2016 and is struggling to meet the transport requirements of over 900,000 passengers per annum. In recent years the Shire has upgraded the main runway to handle airside movements and has recently spent $7.34 million on car park expansion and $4.9 million upgrading the terminal. It remains inadequate. The Shire is currently undertaking essential electrical and water supply improvements totalling $20 million as it revises the previous master plan. Key questions for the Karratha airport are its elevation to international airport status and the potential construction of a new terminal on the eastern side of the main runway. An estimated $100 million is required to provide Karratha with a serviceable international airport with improved connections to the town centre Rail All activity in this sector is currently driven directly by the resource companies that, for the most part, operate lines to carry ore to ports. At some point in the future, consideration will need to be given to re-energising general cargo freight lines from the south to the north. Consideration of integrated freight planning has been initiated by Infrastructure Australia. At a conceptual level, there is the possibility of having rail links from Perth, through Geraldton up to the Pilbara and potentially from Kalgoorlie to the Pilbara, eliminating the requirement for freight from the east coast to travel into the north west via Perth. The impact on roads, the negative carbon footprint and escalating fuel costs should require a re-appraisal of the competiveness of rail as an alternative or multi-modal option in combination with road freight PILBARA REPORT 2012 PILBARA REPORT

14 7 Funding the Future 8 An Investment Transformation Conservative estimates place the GRP of the Pilbara at $14.04 billion. 7.1 ROYALTIES Most WA royalties are collected from companies operating in the Pilbara. Total royalties were over $3.8 billion in 2010 and in 2011 exceeded $4.9 billion. Additional royalties are collected by the Commonwealth government. Onshore mining royalties were approximately $2.39 billion in Table 7 (right) shows the royalties for iron ore and petroleum from Pilbara resources. Approximately 70% of all WA mining royalties are from the Pilbara. Following the announcement of an increase in State Agreement royalty payments effective 1 July 2012 and 2013 these returns will increase. For the financial year, the State allocated $1.2 billion to Royalties for Regions with about $345 million earmarked for projects in the Pilbara. As the Pilbara enters a new significant growth curve, evidenced by the escalation of investment and production by mining companies and offshore gas facilities, it is highly likely that even with a fall in commodity prices, the level of royalties will remain around $4 billion from the Pilbara, for at least the next five years. Given the proposed lifespan of Pilbara Cities, thought needs to be given to what comes next to maintain the level of public good and utility investment required to sustain the region. Table 7: State Mining Royalties from the Pilbara Royalties Iron ore (A$ m p.a.) Petroleum (A$ m p.a.) Actual Actual One concept would be the conversion of the Pilbara Cities initiative into a development bank model with a regional sovereign fund underpinning investments. This model would allow greater rigour in project appraisals but also a one-stop shop concept for streamlined project mobilisation. Public-private partnerships could be facilitated through such a model. 7.2 PUBLIC-PRIVATE PARTNERSHIPS Much of the development that has taken place in the Pilbara can already be conceptualised as private-public partnerships. Resource companies have a long history of providing essential infrastructure and utilities in the region. Naturally, the primary requirement was to fulfil their needs for infrastructure to support mine production, but in so doing, towns were built and community services were, and are, provided. This continues today with major port, rail and housing developments often funded by resources Budget Estimate Forward Estimate Forward Estimate Forward Estimate ,933 1,720 2,676 2,970 3,062 2, companies. The significant difference that is required is for the development of these assets to be driven primarily by a combination of public need and positive return on investment, rather than as struts under the resource sector. New models of ownership, investment strategy and development objectives need to be defined. Proposals include resourcing the Pilbara Cities Office as a fully fledged development bank for the Pilbara; developing a substantial land bank to create liquidity in the housing market; and, encouraging domestic and international superannuation funds to buy into infrastructure asset developments. Over the period to the rate of growth of GRP in the Pilbara has been higher than the fast growing economies in Asia. The Pilbara should continue to experience high rates of GRP growth in the next 5 to 6 years mainly as a result of an exceptional increase in resource sector investments and production, which should have strong multiplier effects on the other sectors of the economy. Some of the key economic facts that, while often publicised, are only now beginning to gain serious traction in the minds of the public and private sectors, are detailed below: By 2018 the export value of major minerals, primarily iron ore, and oil and gas, could be up to $150 billion. This is not a certainty as quantities and prices may vary significantly the latter is difficult to forecast. Nonetheless the value of the Pilbara economy to WA and Australia is likely to increase substantially. The Pilbara currently accounts for almost two thirds of the commodity exports of the State by value, which is almost 20% of the total value of merchandise exports of Australia. This contribution will increase significantly over the next 5 years The project pipeline for expansion and new investment into mining and support infrastructure by the resource industry is estimated to be over $100 billion over the next five years, building upon the current substantial investment levels The number of new construction jobs during this period is in the order of 40,000 (mostly FIFO) with about 15,000 permanent new resource industry jobs created Using the generally accepted multiplier of 1.8 the resource industry will generate another 10,000-12,000 jobs in support industry and commerce. The Pilbara as a whole had a permanent population of about 55,000 people in 2011 Figure 7: Pilbara GRP Scenarios AS mn Series 1: Transformation Growth Scenario Years With a conservative growth estimate of 5% per annum the Pilbara population will have exceeded 80,000 by If all the major projects come to fruition and the constraints to growth are removed this population could reach 100,000 by that date. The Pilbara currently generates about $5 billion of royalties for the State (this is about 75% of the total resource industry royalties collected by WA). Even with a significant drop in commodity prices, in current dollar terms these royalties are unlikely to drop below $5 billion per annum, and are more likely to increase. Approximately 10% of these royalties are currently earmarked on an annual basis for public sector projects in the Pilbara. The impact of such growth on GRP is extremely difficult to calculate because the big unknown is how much of the income and product will be generated by and stay in the Pilbara itself rather than from outside the region (predominantly Perth at present). Two growth scenarios have been estimated for this Prospectus, a high growth scenario and a low growth scenario. The greater the success of the Pilbara Cities Vision in attracting a Series 2: Low Growth Scenario more permanent work force, and local production and services, the faster the Pilbara economy will grow. The high growth scenario (taking into account the high rate of growth from to and high levels of capital investment thereafter until at least ) is possible, even with a short term fall in commodity prices. Over the ten year period 2013 to 2022 GRP is likely to increase from about $14.5 billion to about $27 billion. Over the same period the contribution of the Pilbara economy to the WA economy (GSP) is likely to increase from 7% to about 11%. The low growth scenario is predicated on the public utility infrastructure investments not taking place on schedule and land release being delayed. This would constrain the deepening of the local economy, and place ever more reliance on imports of both products and labour (FIFO), which while probably ensuring the resource sector investments take place, does not in itself equate to significant rises in the GRP. The impact of the proposed transformational growth on GRP over the next 10 years could be as shown in Figure 7 (above), if there is a diversification and deepening of the value chains of the Pilbara economy. 24 PILBARA REPORT 2012 PILBARA REPORT

15 9 The Enabling Environment The scope and scale of development will be dependent on the enabling environment. That is, in order to enable sustainable changes, key aspects of the environment need to be considered, namely political, economic, social, cultural, technological, (natural) environmental and legal factors. Specifically, this includes legislation; processes; institutions (and their roles); the cost structure for households and businesses; and, sufficient investments in construction, housing, infrastructure and economic diversification. 9.1 SPECIAL ECONOMIC ZONES One enabling mechanism is the creation of a Special Economic Zone (SEZ) to reduce costs and increase required investments in the non-resources sector. SEZs have quite a long history. They have become more prevalent over the last two decades and span all regions of the globe. The International Labour Organization s database of special economic zones reported 176 zones in 47 countries in 1986; by 2006 this had risen to 3,500 zones in 130 countries. Studies by organisations such as the World Bank 12 have stressed the importance of suitable policies as a basis for effective economic stimulation. An article in VOX 13 has recently encapsulated lessons learned over the last few decades, noting that it is only recently that SEZs have been used as a policy instrument. Due to the new economic environment created under a SEZ, investors can benefit not only from the wide range of business opportunities, but also from tax and investment incentives, access to a highly qualified labour force, as well as natural and energy resources. An SEZ across the Pilbara would ensure the necessary infrastructure and services for manufacturing and industry, attract additional diversified investment, incentivise the development of new technologies, diversify the economic base, and enhance entrepreneurial and technical capacities. In order to achieve a transformational change in the way business is done in the Pilbara, and given the pace at which government process must keep up with production, it is proposed that an SEZ designation be formulated for the Pilbara. The SEZ category can embrace a wide range of special zones, including Free Trade Zones (FTZ), Export Processing Zones (EPZ), Duty Free Zones (DFZ), Industrial Zones (IZ), free ports and Urban Enterprise Zones among other enabling mechanisms. The experience of many successful SEZ around the globe should be considered to design an effective SEZ for the Pilbara. The overarching purpose of an SEZ is to maximise economic growth and contribute to the social sustainability of the Pilbara, thus assisting with the achievement of the Pilbara Cities Vision. The objectives of an SEZ are to: 1. Ensure continuing large scale investment in the resources sector to maximise the contribution of the sector to the GRP of the region and the nation; 2. Adjust the legislative framework to attract business diversification through investment in non resource sector activity; 3. Utilize an economic management system that is especially conducive to doing business in the Pilbara 4. Provide sufficient essential infrastructure to support development; 5. Improve the processing of investment applications to reduce costs and speed up approval and, therefore, delivery of investments; 6. Reduce the cost structure of the Pilbara, including accommodation, services, transport and communications; 7. Diversify the economy and secure investment by non extractive industries; 8. Encourage local production to meet supply chain needs; 9. Increase the proportion of residents in the population of the Pilbara consistent with the Pilbara Cities Vision; 10. Increase skills levels of the working population; and 11. Increase employment opportunities. The creation of an SEZ for the Pilbara by establishing new policy, regulation and enabling mechanisms, including delivery of the necessary skills and resources to bring it into effect, would provide a clear opportunity to meet these objectives. Such a move would warrant the creation of an appropriate governance structure for the Pilbara, pulling together the myriad of agencies and organisations charged with development across the region. Considerable investigation has been undertaken into a suitably structured and empowered organisation. Regional Development Australia Pilbara has championed the call for one body within the region that has the knowledge, relevance and authority to conduct high level discussions and decision making. This call was echoed in Recommendation 10 of the 2011 Review of the Functions and Responsibilities of Regional Development Commissions which stated: Establish a Ministerially endorsed and mandated working party to strengthen the integration and alignment of statutory land use planning, regional development, and local government service delivery within existing legislative planning frameworks for the Pilbara region. Combining the functions, powers, and resources of the many Pilbara agencies into one Pilbara Development Authority will surely empower and provide greater responsiveness. This focused approach to facilitating the development of the region, including the establishment of a special economic zone with development bank capabilities, will enable the region to operate effectively and efficiently. This enabling mechanism is critical to optimise the Pilbara s potential. 12 VOX (network of research based policy analysis and commentary from leading economists) - Thomas Farole - Senior Economist in the International Trade Department of the World Bank - September Special economic Zones performance, lessons learned, and implications for Zone development - April 2008 Regional Development Australia Pilbara has championed the call for one body within the region that has the knowledge, relevance and authority to conduct high level discussions and decision making. 26 PILBARA REPORT 2012 PILBARA REPORT

16 10 Economic Diversification Perspectives On 16 May 2011, State Cabinet approved an allocation of $30 million to support economic diversification in the Pilbara under the Pilbara Cities initiative. For employment targets 14 to be realised it is essential that the economies of the main Pilbara cities be diversified. This will have the added benefit of making the towns less susceptible to the uncertainties of global resource commodity price fluctuations. Economic diversification is most likely to be achieved by identifying and making use of the region s competitive advantages. These are: Significant reserves of iron ore and other minerals - industrial backbone; Major off-shore reserves of oil and gas industrial backbone; Proximity to Asian markets - some four billion people in the same time zone; Renewable energy potential - solar, wind, wave, tidal and thermal energy; Raw natural beauty of the region s ranges and coastline - tourism; Aboriginal culture and heritage - lifestyle tourism; Early settlement and pastoral heritage - lifestyle tourism; Mild dry winter climate - lifestyle tourism; and Abundant land. Economic diversification opportunities that have already been identified as having potential include: Tourism; Aquaculture; Value Adding to Resources; Biofuels and Algae Based Industry; Agriculture and Pastoral Industry Development; Engineering Infrastructure Supporting Oil and Gas and Mining Project Development; Solar and Renewable Energy Provision and Energy Efficiency; and, Industrial Water Efficiency Measures. Studies are required to identify the Pilbara s comparative advantage for new industries or expansion of sectors in the Pilbara. These studies can then be used to promote the Pilbara to international investors, as an incentive to stimulate further investigation and investment in new enterprise opportunities. It is envisaged that support will be required to transition the concepts identified by the studies through to project opportunities. These investment opportunities should be selected on the basis that they will make a positive contribution towards creating sustainable production systems for these sectors in the Pilbara. Accordingly, selected projects aim to: Improve or establish the production systems and supply chain infrastructure of existing or potential new products respectively; Introduce the element of diversification, and hence reduced risk, as a strategy for improving each sector s production and profitability; Set up systems that enable investors to be more responsive to changing market demands as well as be less dependent on harsh and/or declining natural resource bases; Integrate the recommended projects so that they all form part of the system or supply chain of the sector; and, Improve either the existing operation and management systems and/or the supply chains of a variety of products. Diversification of the economy is critical to sustainability of the Pilbara. A range of opportunities that have been identified already need to be thoroughly explored, though comprehensive feasibility studies. To illustrate the opportunities that could be developed, selected project examples are presented below TOURISM The recreational vessel marinas and residential precincts proposed for Dampier and the Spoilbank in Port Hedland are both in the planning phase. These two projects have a forecast cost of approximately $225 million, and together with extensive landside facilities, present significant investment opportunities BIO-FUELS The Department of Regional Development and Lands (RDL) has funded a pilot project to demonstrate how high energy bio-fuel crops can produce High Energy Return on Energy Invested crops on marginal lands using mine de-watering. The pilot project undertaken by AgGrow Energy Resources has been located adjacent to the Woodie Woodie mine site in the East Pilbara, which is about 150km east of Marble Bar. The project ran pilot trials on a range of different biomass crops and indigenous tree species under drip irrigation. The aim was to evaluate their respective dry matter characteristics and perform an energy evaluation. The bio-fuels produced from these crops and trees burn cleanly and emit 60 80% less greenhouse gas emissions than diesel. Other benefits include: Alternative energy at a cost per litre of less than half current diesel fuel costs; Limited requirements for fuel transportation across large distances; Feedstock for pastoralists that will help the Pilbara to drought-proof and achieve higher mass on livestock; Tree plantations such as sandalwood; Production of co-product carbon black which has a high current value and limited sources of supply world-wide; Alternative economy for a mine site once it moves towards closure thereby having sustainable use of built infrastructure; Agricultural incubation and learning centres; and, Use of mine de-water most of which is currently not used. Indicative financial benefits include: Saving in the region of $20 million per year for a medium sized mine site on fuel costs. Approximate production of 2 million litres of bio-fuel; Income from feedstock and co-products with carbon black selling at approx. $700/ton. Approx production of 9000T of carbon black; Total indicative investment requirement for 140Ha site is between $10-12 million depending on location and available on-site infrastructure; and, Moderate to high return on investments BUSINESS INCUBATION Business Innovation and Incubation Australia 15 (BIIA) believes that it is time for the Australian Government to have another look at business incubation as a way of generating wealth and employment for Australia. The world has moved on with models of business incubation that are delivering real economic benefit, and Australia is being left behind. Through the Pilbara Development Commission and other regionally based agencies, studies have now been conducted or are being conducted into the feasibility of establishing a series of business incubators. Site selection and concept plans exist for Newman reflecting a viable operation. A similar exercise has been undertaken for Karratha and this model is concurrently being applied to Tom Price and Onslow in the Shire of Ashburton. The model is capable of being translated to other Pilbara locations such as Port Hedland and Roebourne. The feasibility work done to date indicates that these developments present sound investment opportunities, providing solid returns. Indicative investment costs per business incubator site range from $5 million to $35 million depending on size and sophistication AQUACULTURE A proposed project is the development of off-shore and on-shore based Asian Sea bass (Barramundi) farms, possibly in the Dampier area. The proposed system would be pump-ashore for grow-out with a hatchery facility and associated feed plan. A feed mill is considered to be optional. Indicative costs can be provided along with further detail of data requirements for development of such a facility. There is potential for the farm to promote local employment and skills generation, re-generation of marine biodiversity, and improvement of the local economy. Predictive models indicate an output in the first year of 400 tons rising to 1,400 tons per annum by year 6. Further opportunities exist for the establishment of a local processing plant. Excess seed production from the hatchery could be sold regionally to other commercial farms. Indicative capital costs of $1.3 million for a 400 ton farm and $3.6 million for a 1,000 ton farm. Potentially high Internal Rate of Returns (IRR) of over 20% are achievable RENEWABLE ENERGIES A comprehensive study on renewable energies for the Pilbara has recently been undertaken and provides a detailed analysis of the issues and opportunities, challenges and risks 16. The report suggests that wind power and photovoltaic solar energy show the most likely competitiveness in the Pilbara. The region is regarded by some as the ideal location for these industries. However, there are a number of challenges to overcome before renewable energies become a significant source of energy, and the increasing use of renewables will need to be incentivised. To illustrate the potential of renewable energies, consider the case of a new solar plant which has recently been commissioned in India in an environment similar to the Pilbara. The 40 MW plant is on 350 hectares, contains 500,000 PV solar panels, and was built at a cost of just under $150 million. It was co-financed by the Asian Development Bank. 14 Pilbara Planning and Infrastructure Framework, Pilbara Regional Planning Committee - Western Australian Planning Commission, November Business Innovation and Incubation Australia, Study Tour of New Zealand Incubation Assessment of the potential for renewable energy projects and systems in the Pilbara, October Prepared for the Australian Centre for Renewable Energy (ACRE) by Evans & Peck and WorleyParsons. 28 PILBARA REPORT 2012 PILBARA REPORT

17 The Priority Infrastructure Projects 11 Housing and Land: Investment Prospectus The focus now shifts to the critical projects that are required in the short to medium term for the Pilbara region in order to secure the three essential ingredients for achieving transformational growth housing, power and water. The housing and land situation in the main Pilbara towns has been an issue of increasing concern and continues to be the number one constraint raised by all stakeholders. Using currently available data, Table 8 (below) highlights the dynamics of the residential market at present. In a highly distorted market environment it is difficult to quantify what would be regarded as a normalised market. The one comparator would be Perth, where supply and demand tends to be in relative equilibrium and the cost of land and housing (all things being equal) are in similar order of magnitude to the average house price. This is illustrated in Table 9 (right). There are many variables that could impact the costs and prices, but by using this average data, established Perth houses sell for about a 10% premium over the cost of building a new one. In the two main Pilbara towns the premium is in the order of 25%. Using the Perth ratio at current market prices, and without adjusting for any economies of scale reduction in Pilbara building costs, the average current price for a house in Hedland and Karratha should be more in the order of $700,000. Recent data on supply and demand that takes into account all of the proposed, planned and under construction residential developments in Hedland and Karratha, and using Pilbara population growth projections, reveals the following macro level picture shown in Table 10 (right). There are a significant number of assumptions and caveats on this outcome that have been discussed in detail in the broader Pilbara Plan review. The figures shown here do not reflect annual dislocations between supply and demand. However, at the most macro level if these projections are achieved then there is a possibility of Pilbara house prices stabilising and possibly even reducing towards Perth averages over the next five to ten years. From an investment perspective and again just using average current prices the value of the Hedland and Karratha residential construction market (land and house) over the next five years is potentially A$7 billion, with an estimated Table 8: Pilbara House Prices and Sales Location Average House Price A$000 Dec 2011 Average sales per year (last three years) Port Hedland 1,000 ~ 50 South Hedland 750 ~ 170 Karratha 850 ~ 170 Newman 700 ~ 40 Other Pilbara towns 870 ~ 60 All Pilbara Residential Lots (residential land) 450 (land only) Table 9: Price Comparisons between the Pilbara and Perth ~ 280 Land and housing comparisons Pilbara Perth equivalent Cost of bringing average Lot of 700m 2 to $200,000 $150,000 market ready in Hedland and Karratha Cost of building average house of 200m 2 $440,000 $300,000 Cost of building land and house $640,000 $450,000 Average sale price of houses (Dec. 2011) $800,000 $500,000 Average weekly rental for a standard family home $2,000 $500 Table 10: Potential Housing Demand in Pilbara Cities (Dwelling Units) Town Existing Supply (2012) Forecast Supply (2016) Forecast Demand (2016) Development required Shortfall Port Hedland 6,054 11,455 11,440 5, Karratha 5,680 8,551 9,907 2,871 1,356 Newman 1,859 2,431 3, Total 13,593 22,437 24,391 8,844 1,954 residential housing sales value of up to A$9 billion. Inherent to this investment potential is the need for a broader mix of residential offerings, more attention to appropriate designs for the geography and climate of the region, and integrating residential needs with supporting commercial and retail facilities. Estimated returns on investment would be moderate to high with possible IRRs of 20%. 30 PILBARA REPORT 2012 PILBARA REPORT

18 12 Power: Investment Prospectus Figure 8: Existing and Future Power Demand and Supply Source: Pilbara Infrastructure Priorities 2011 Update Report, (Unpublished) 12.1 OVERVIEW The North West Interconnected System (NWIS) consists of power networks and generation capacity owned and operated by multiple parties including BHP Billiton Iron Ore, Rio Tinto Iron Ore, Alinta, ATCO and Horizon Power. It is WA s second largest transmission network with an installed capacity of 500 MW and 1,200 km of transmission lines. Approximately 75% of the region s installed generation capacity (1,600 MW) is not connected to the NWIS. This reflects the fact that resource companies have tended to develop energy supply solutions to service the needs of individual projects, rather than adopting an integrated, coordinated grid-based regional energy development strategy. A number of these isolated generation facilities are predominantly small-scale and diesel-fired. Horizon Power is a vertically integrated electricity provider responsible for generation/procurement, transmission, distribution and retail of electricity to customers in regulated areas outside the South West Interconnected System (SWIS). It supplies residential, industrial and commercial customers and resource developments. It delivers power to over 43,000 customer connection points, supplying more than 35,000 residential properties and 8,000 businesses. It generates only about 13% of the electricity it supplies from its own assets, with the remaining 87% being purchased from privately-owned generators and renewable energy from Verve Energy. Horizon Power s load in the Pilbara has grown significantly in recent years. The current demand supply balance is becoming increasingly tight and does not cater for expansion in the region. At least 90 MW of new generation capacity will be required by 2016 to meet existing known loads. It is estimated that a total of 350 MW of generation and transmission upgrades will be required to meet the power requirements of Karratha and Port Hedland over the next 10 years. Horizon Power is presently evaluating a range of options to procure this capacity. One option is for Horizon Power to build, own and operate a generation plant or to underwrite a new private facility through a long-term Power Purchase Agreement (PPA) and guaranteed provision of gas to that new facility. Alternatively, there is currently a significant amount of underutilised generation capacity in the Pilbara resulting from the number of self-generation facilities without network connection, and consequently with excess levels of reserve capacity. If these assets could be accessed to make more efficient use of existing capacity, less new generation investment would be required, although investment in transmission capacity would be required to transport the power to the load centres. As an example, to bring the numerous small miners operating to the east of the Wickham-Tom Price transmission line onto the Horizon Power grid would require a major transmission line development running North-South from Port Hedland to Newman. This could cost in the region of $600 million and is in Horizon Power s long-term development scenarios. A number of resource companies are planning or constructing new generation plants, for example Citic Pacific (450MW) and Rio Tinto Iron Ore (250MW). These are currently being built independently of network system requirements and include substantial reserve capacity. Existing and future power demand and supply is shown in Figure 8 (above). Port Hedland Power Generation Project The most critical immediate area for supply is Port Hedland and the objective is to secure a stable supply for existing and future demand with a 120MW power generation plant. At this point in time there is no identified funding solution and, therefore, a start date cannot be determined. It is acknowledged that supply will be needed in 2013, although the project is anticipated to take 3 years for completion. A range of funding mechanisms could be considered including public-private partnerships. The current estimate for the cost of the plant, plus all ancillary infrastructure works, is in the order of $400 million. A new power plant would increase the supply capacity to Port Hedland, and through the NWIS to the Pilbara region, helping to stabilise long term planning for new commercial, residential and industrial investors in the region. It could encourage some economic diversification activity. Key risks include: Capital cost to borrowing ratio Planning process Security of TEF arrangement Long term PPAs IRRs would need to be provided by a feasibility study, but preliminary indications are that they would be in the 5-10% range. A range of stakeholders rank this project as a high priority. 32 PILBARA REPORT 2012 PILBARA REPORT

19 13 Water: Investment Prospectus Capacity of utility infrastructure in the Pilbara is a major short-term issue that needs to be resolved as a matter of priority. The increasing scarcity of water resources, particularly in coastal areas, will create uncertainty for the State, the community and industry. While short term ground water supplies may be adequate, long term water supply requires a strategic approach to cater for growth in demand from industry and commerce - future demand increases may be met in part by mine de-watering in the Pilbara. Matching sources and supplies to meet demand, and at the same time ensuring the best water management outcomes, should form the focus of water supply planning. There will be a requirement to identify and utilise new water sources. In addition, the design and structure of housing and development will need to consider water efficiency through maximising opportunities to harness and Existing scheme supply 30 Bungaroo borefield Projected water demand Desalination plant cost PORT HEDLAND INVESTMENTS re-use storm and waste water, as well as providing green spaces for community enjoyment. Water sensitive urban design approaches must be tailored to the climatic conditions of the Pilbara. Most of the water used by coastal towns and for port water supply, in terms of volume, is delivered through the West Pilbara Water Supply Scheme and the Port Hedland Water Supply Scheme. Inland towns are serviced by specific local schemes KARRATHA INVESTMENTS In Karratha it appears that water from the Bungaroo Borefield development by Rio Tinto Iron Ore will only be available until Thereafter the 2ML per annum currently available will be lost as all of the water available from this source will be needed by the mining company. A potential borefield exists near Cape Preston, which could be developed to supply the West Pilbara Water Scheme, although an 80km pipeline would be required to connect the source to the scheme. The pipeline could convey surplus water from the Citic Pacific mining Cape Preston desalination plant currently producing 50GL per annum of process water with an ultimate capacity for 100GL per annum. This would assist in supplementing existing supplies until Water supplies for the Shire of Roebourne are shown in Figure 9 (below). This includes Karratha, Wickham, Roebourne, Point Samson, Dampier, Burrup and Cape Lambert. The growth scenario used for water demand is based on the Pilbara Cities forecast of 25,000 people in Karratha by This approximately corresponds to the Water Corporation high growth scenario. This scenario corresponds to Department of Water high growth scenario anticipated through Pilbara Cities. It is also worth noting that the supply assumptions assume both ground water and desalination. There is a possibility that all future supply is sourced from desalination. The current BHP Billiton water allocation could be increased from 7.5GL to 15GL to supply additional needs until Thereafter, it is possible that additional water could be sourced from the West Canning Basin, at an estimated capital cost of $400 million. If this is not the case, then a 5GL desalination plant may be needed to secure supplies until 2020 with a capital cost of up to $500 million. An upgrade of part of the Port Hedland water supply and conveyance system is also required. The demand for this project is being driven by the abnormal rate of mining development in the Port Hedland and East Pilbara Shires. The Port Hedland water projects include upgrade of the transfer main from the Yule groundwater source, storage tanks and distribution network improvements that have had to be deferred due to insufficient funds. The capital cost is estimated to be $63 million. Water supplies for Port Hedland are shown in Figure 10 (above right) Figure 10: Water Supplies and Demand Port Hedland18 Port Hedland population (Pilbara Cities population growth scenario) Efficiency savings Desalination plant Existing groundwater update Existing scheme supply Desalination plant 30 Upgrade existing borefields Projected water demand Projected population Desalination plant PILBARA REPORT 2012 Bungaroo Borefield Existing BFPL desalination upgrade Efficiency savings Harding Dam & Millstream groundwater There is a strong possibility that the existing Karratha water scheme may have to rely on a new desalination plant to add to existing supplies with a capacity of 15GL that is required to meet demand until Current demand is above the sustainable yield of the existing West Pilbara System. The most reliable short term source option is a new 15GL desalination plant constructed on the Burrup Peninsula. This will fulfil the expected demand for water until The desalination plant will need to be supplemented with the development of water extraction from the Bungaroo Valley. The existing system requires upgrading. Water (GL/a) Karratha population (Pilbara Cities population growth scenario) Projected population The Pilbara Regional Water Plan provides a strategic and long term approach to sustainable water resource planning and management for the Pilbara region. Potable Water use across the Pilbara falls into two distinct categories: water delivered through water supply schemes to towns and ports, and water managed through self supply at mine sites. Water associated with mining falls into both of these categories and accounts for approximately 70% of managed water. Figure 9: Initial Water Supplies and Demand for Karratha17 (includes Karratha, Wickham, Roebourne, Point Samson, Dampier, Burrup and Cape Lambert) Water (GL/a) The supply of water and energy in Karratha and Port Hedland has become critical to the extent that proposed growth cannot be accommodated. In short, neither town will be able to support a population increase to 25,000 by 2020 without extensive, additional investment. Onslow, although smaller in size, is in a similar position WEST PILBARA SCHEME AND PORT HEDLAND PORT HEDLAND AND NEWMAN WASTE WATER CONVEYANCE Transfer of water from sites in the East Pilbara region that have surplus supplies is also being investigated. This requires a full feasibility study to determine capital costs and cost effectiveness related to the different volumes of supply. Additional investment opportunities may arise from investigations and studies being carried out by the Water Corporation. For example additional supplies to Port Hedland could be sourced from a new bore field supplying up to 6GL per annum from a suitable location on the De Grey River aquifer and a possible groundwater option exists in the Canning Basin. The Port Hedland wastewater projects include wastewater conveyance projects in Port and South Hedland, which need to be advanced to service growth, but for which funds are currently not fully available. A similar expansion is required in Newman. The estimated capital cost is $35.8 million. This funding demand is being driven by the heightened rate of mining development in the Port Hedland and East Pilbara Shires. Wastewater treatment has not been listed as the Water Corporation has already funded these requirements. The current demand is currently 9.5GLpa as BHP are not using their full entitlement. Source of graph draft PIPF (unpublished) Dept of Planning Priorities discussed with Department of Planning and Department for Regional Development and Lands a full feasibility study will be required PILBARA REPORT

20 Contacts for further investigation Regional Development Australia Pilbara Ph: (08) Lotteries House Morse Court Karratha 6714 Pilbara Development Commission Port Hedland Office Ph: (08) Shop 2/6 Wedge Street PO Box 544, Port Hedland 6721 Karratha Office Ph: (08) Cnr Searipple and Welcome Roads PO Box 294, Karratha 6714 Newman Office Ph: (08) Unit 1/46 Iron Ore Road PO Box 630, Newman 6753 Pilbara Cities Office Ph: (1300 PC CALL) Karratha Office 5 Sharpe Avenue, PO Box 888, Karratha 6714 Perth Office Level 2, 140 William Street Perth 6000 PO Box 1143, West Perth 6872 Pilbara Regional Council ceo@prc.wa.gov.au Ph: Level 1, 414 Murray Street, PERTH WA 6000 Town of Port Hedland ceo@porthedland.wa.gov.au Ph: (08) McGregor Street PO Box 411 Port Hedland 6721 Shire of Roebourne ceo@roebourne.wa.gov.au Ph: (08) Welcome Ave, PO Box 219 Karratha 6714 Shire of East Pilbara ceo@eastpilbara.wa.gov.au Ph: (08) Kalgan Drive, PMB 22 Newman 6753 Shire of Ashburton ceo@ashburton.wa.gov.au Ph: (08) Poinciana Street PO Box 567, Tom Price 6751 Small Business Centre West Pilbara manager@sbcwp.com.au Ph: (08) Unit 2/24 De Grey Place, PO Box 1568, Karratha WA 6714 Small Business Centre East Pilbara manager@smallbusinesscentre.org.au Ph: (08) Anderson Street, PO Box 685, Port Hedland 6721 Karratha and Districts Chamber of Commerce and Industry ceo@kdcci.asn.au Ph: (08) Unit 3/24 De Grey Place PO Box 10, Karratha WA 6714 Newman Chamber of Commerce and Industry ncci@bigpond.com Ph: (08) Lot 1403 Mindarra Drive PO Box 611, Newman 6753 Port Hedland Chamber of Commerce info@phcci.com.au Ph: (08) Wedge Street PO Box 95, Port Hedland 6721 UWA Pilbara ben.killigrew@uwa.edu.au Ph: (08) A 35 Stirling Highway Crawley 6009 Prepared by CCS Strategic in association with Imani Development and Turner Design. 36 PILBARA REPORT 2012