Sensational-Adelaide.com

$7bn BHP Billiton mine giant to go ahead: Mike Rann

MIKE Rann has moved to end uncertainty over development of the nation's biggest mine, revealing advice from BHP Billiton that the Olympic Dam project would proceed as an open-cut operation.

The South Australian Premier's declaration, in an interview with The Australian, will shore up confidence in the $7billion expansion of the copper, gold and uranium mine when falling commodity prices and the slowing world economy had raised concerns that BHP would back away from converting the existing underground operations.

The company is in the final stages of framing an environmental impact statement, and analysts are crunching the numbers on a range of development options that will be presented to the BHP board late next year.

The company has already moved away from the South Australian Government's preferred option to smelt on site the dramatically increased volume of ore it is set to produce.

As copper prices fall and demand for Australian mineral exports shows signs of tanking, especially in the crucial China market, there has been speculation that BHP could scale back the mine expansion. Under this scenario, Olympic Dam's underground workings would be enlarged, with construction of the open-cut deferred.

But Mr Rann insisted this was not BHP's position. Asked if the open-cut plan would proceed, he said: "Yes, absolutely."

The Premier said the mine was valued as a trillion-dollar resource. "They did not purchase the orebody to leave it as a carpark," he said.

"And the price of uranium and copper in four years' time, when they reach the orebody, will be worth a bloody sight more than it was worth last week."

The Olympic Dam redevelopment is a hot political issue in South Australia. Mr Rann has elevated the mine to the status of "mother ship" for his ambitious minerals strategy.

The mine, 560km north of Adelaide, is Australia's largest underground operation, and contains the world's fourth-biggest copper deposit and the largest known reserve of uranium ore.

BHP has long-term contracts for the sale of uranium oxide concentrates to Britain, France, Sweden, Finland, Belgium, Japan, South Korea, Taiwan, South Korea, Canada and the US.

Another Australian uranium producer, ERA, which operates the Ranger Mine in the Northern Territory, began shipping nuclear fuel to China this year.

Mr Rann said a visit to China in October had buoyed his confidence in its potential as a uranium export market. "Every single meeting I went to was about uranium," he said. "At every single meeting they said, 'We know we have got to do something about greenhouse gas emissions ... and develop a prototype nuclear power station, and this is mass-produced'. So with the world turning to uranium to deal with ... the threat of climate change, we have got 50 per cent of the world's uranium in South Australia. We are in pole position.

"So am I confident about BHP Billiton going ahead with the Olympic Dam mine? You bet I am." Mr Rann, who is ALP national president, pushed hard for Labor to scrap its no-new-mines policy on uranium last year.

But he rejected calls by former NSW premier Bob Carr and Australian Workers Union leader Paul Howes for a wider rethink on developing a domestic nuclear power industry.

Mr Rann cited practical problems, not ideological concerns, saying the cost of nuclear power would double electricity prices.

Asked if he would be prepared to consider a proposal for a nuclear plant, Mr Rann said it would be a waste of his time and the proponent's to "chase a rainbow that doesn't exist".

Jamie Walker http://www.theaustralian.news.com.au

ONE of the nation's most troubled Aboriginal homelands is set to open up to oil exploration and mining in a bid to break the cycle of poverty and welfare dependence.

Central to the plan for South Australia's remote Anangu Pitjantjatjara Yankunytjatjara communities is construction of aroad linking the east to the west, creating a pathway to development.

The lands -- spanning 103,000sqkm of desert in the far north of the state, bordering the Northern Territory and Western Australia -- are believed to contain rich reserves of petroleum and nickel.

Although mining companies have been keen to explore the APY area, access problems and local opposition to development have defeated most efforts to evaluate its potential mineral wealth.

That may be about to change. The APY governing board has commissioned consultants to weigh the costs and benefits of pursuing full-scale mining and oil drilling on the lands.

As part of the investigation, the route of a development road has been mapped out.

A copy, obtained by The Australian, shows the road linking up with the railway to Alice Springs on the eastern side of the lands, with spurs to towns such as Indulkana, Umuwa, Amata and Pipalyatjara near the West Australian border.

The lands contain numerous mineral tenements, but so far their development has been limited. As is the case with most remote indigenous communities, unemployment is rife.

Earlier this year, former Supreme Court judge Ted Mullighan, reporting on a three-year inquiry into child abuse on the lands, found that one in seven children had been sexually abused. This was a national disgrace, he said.

The study being carried out for the APY board by consultants Coffey International will assess the impact of three scenarios:

• * Large-scale development of petroleum resources in the APY lands, similar to that in the Moomba field spanning the SA-Queensland border.
  * Development limited to about half the size of Moomba.
  * No development.

South Australian Chamber of Mines and Energy chief executive Jason Kuchel said a new road through the APY lands would provide economic benefits for miners and social benefits for the communities in the area.

"We see it as a win-win for everybody," Mr Kuchel said. "I think this is the sort of infrastructure South Australia needs to invest in to encourage more investment in exploration."

Much will depend on whether newly re-elected APY lands chairman Bernard Singer, who has an assault charge pending, can overcome local suspicion about development and persuade the state and federal governments to come on board with funding.

Mr Kuchel said that, although he did not think mining companies would consider contributing to the cost of building the road, they were likely to pay to help maintain it.

Alice Springs-based nickel explorer Mithril's managing director, Graham Ascough, welcomed the idea of a new road through the lands, saying it would cut costs and reduce the size that any minerals find would need to be to make a mine economical.

Mr Ascough said existing roads into the lands were rough and unsealed, making the trucking of equipment to exploration sites a slow, expensive process.

Regulators approve Mitsui buying into Uranium One's SA assets

Japan's second largest trading company Mitsui & Co has acquired a 49 per cent stake in the Australian assets of Canadian uranium miner Uranium One after regulators approved the joint venture deal.

The assets include Uranium One's Honeymoon project in South Australia, where trial mining was undertaken between 1998 and 2000, and its nearby Goulds Dam and Billero exploration projects.

Uranium One said Mitsui's total minimum cash commitment for its share of these projects will be about $104 million, with most of these funds to be used to develop Honeymoon as a commercial mine.

Uranium One executive vice president Australia and Asia Greg Cochran said site development work was slated for early in the new year.

Mr Cochran said the project had an expected mine life of six years, with production scheduled to commence in 2010.

SA Premier Mike Rann said the multi-million dollar investment highlighted the confidence resource companies have in South Australia amid the current global economic uncertainty.

"The jobs and investment flowing from this joint venture agreement will support the long term economic development of this state and provide important export earnings for Australia," Mr Rann said.

bm7500 wrote:

$7bn BHP Billiton mine giant to go ahead: Mike Rann

MIKE Rann has moved to end uncertainty over development of the nation's biggest mine, revealing advice from BHP Billiton that the Olympic Dam project would proceed as an open-cut operation.

The South Australian Premier's declaration, in an interview with The Australian, will shore up confidence in the $7billion expansion of the copper, gold and uranium mine when falling commodity prices and the slowing world economy had raised concerns that BHP would back away from converting the existing underground operations.

The company is in the final stages of framing an environmental impact statement, and analysts are crunching the numbers on a range of development options that will be presented to the BHP board late next year.

The company has already moved away from the South Australian Government's preferred option to smelt on site the dramatically increased volume of ore it is set to produce.

As copper prices fall and demand for Australian mineral exports shows signs of tanking, especially in the crucial China market, there has been speculation that BHP could scale back the mine expansion. Under this scenario, Olympic Dam's underground workings would be enlarged, with construction of the open-cut deferred.

But Mr Rann insisted this was not BHP's position. Asked if the open-cut plan would proceed, he said: "Yes, absolutely."

The Premier said the mine was valued as a trillion-dollar resource. "They did not purchase the orebody to leave it as a carpark," he said.

"And the price of uranium and copper in four years' time, when they reach the orebody, will be worth a bloody sight more than it was worth last week."

The Olympic Dam redevelopment is a hot political issue in South Australia. Mr Rann has elevated the mine to the status of "mother ship" for his ambitious minerals strategy.

The mine, 560km north of Adelaide, is Australia's largest underground operation, and contains the world's fourth-biggest copper deposit and the largest known reserve of uranium ore.

BHP has long-term contracts for the sale of uranium oxide concentrates to Britain, France, Sweden, Finland, Belgium, Japan, South Korea, Taiwan, South Korea, Canada and the US.

Another Australian uranium producer, ERA, which operates the Ranger Mine in the Northern Territory, began shipping nuclear fuel to China this year.

Mr Rann said a visit to China in October had buoyed his confidence in its potential as a uranium export market. "Every single meeting I went to was about uranium," he said. "At every single meeting they said, 'We know we have got to do something about greenhouse gas emissions ... and develop a prototype nuclear power station, and this is mass-produced'. So with the world turning to uranium to deal with ... the threat of climate change, we have got 50 per cent of the world's uranium in South Australia. We are in pole position.

"So am I confident about BHP Billiton going ahead with the Olympic Dam mine? You bet I am." Mr Rann, who is ALP national president, pushed hard for Labor to scrap its no-new-mines policy on uranium last year.

But he rejected calls by former NSW premier Bob Carr and Australian Workers Union leader Paul Howes for a wider rethink on developing a domestic nuclear power industry.

Mr Rann cited practical problems, not ideological concerns, saying the cost of nuclear power would double electricity prices.

Asked if he would be prepared to consider a proposal for a nuclear plant, Mr Rann said it would be a waste of his time and the proponent's to "chase a rainbow that doesn't exist".

Jamie Walker http://www.theaustralian.news.com.au

skyliner wrote: Bm7500, You beat me to it. After all the problems with resources/mining and the China market I became concerned about ODX.

I have been combing the AFR and the only reference to this was in an article about the mining sector being in trouble but ODX plans are still going ahead. (3 line refernce in half a page article. So yes, I confirm your findings but have no specifics to post.

Exciting times ahead - the wheels have not fallen off. By contrast, here in QLD coal mines are laying off large numbers of employees - a double whammy from Chinese drop in demand and the climate policy of the Rudd gov't.

Wayno wrote:There's a very good possibility (as the industry rumours go) that BHP will have a substantial office presence in the Adelaide CBD for the Olympic Dam project. In fact, ODX is so large & complex that BHP might even spin off a separate subsidiary company here in SA to independently manage the operations!

Unfortunately, we should not expect this rumour to turn into published fact anytime soon, maybe not until late-2009 or early-2010.

Yes i know, i'm a tease...

Wayno wrote:There's a very good possibility (as the industry rumours go) that BHP will have a substantial office presence in the Adelaide CBD for the Olympic Dam project. In fact, ODX is so large & complex that BHP might even spin off a separate subsidiary company here in SA to independently manage the operations!

Unfortunately, we should not expect this rumour to turn into published fact anytime soon, maybe not until late-2009 or early-2010.

Yes i know, i'm a tease...

Shuz wrote:

Wayno wrote:There's a very good possibility (as the industry rumours go) that BHP will have a substantial office presence in the Adelaide CBD for the Olympic Dam project. In fact, ODX is so large & complex that BHP might even spin off a separate subsidiary company here in SA to independently manage the operations!

Unfortunately, we should not expect this rumour to turn into published fact anytime soon, maybe not until late-2009 or early-2010.

Yes i know, i'm a tease...

Hopefully you mean substantial enough to secure a tenant to take up all 44,000sqm of 20-22 Currie Street?

Shuz wrote:

Wayno wrote:There's a very good possibility (as the industry rumours go) that BHP will have a substantial office presence in the Adelaide CBD for the Olympic Dam project. In fact, ODX is so large & complex that BHP might even spin off a separate subsidiary company here in SA to independently manage the operations!

Unfortunately, we should not expect this rumour to turn into published fact anytime soon, maybe not until late-2009 or early-2010.

Yes i know, i'm a tease...

Hopefully you mean substantial enough to secure a tenant to take up all 44,000sqm of 20-22 Currie Street?

Shuz wrote:I know its too early to be speculating specifics, but if there's talking about creating a new subsidary specifically for ODX - how much space would BHP need? 20,000? 40,000? 60,000? Surely theres a guesstimate on that?

Shuz wrote:I know its too early to be speculating specifics, but if there's talking about creating a new subsidary specifically for ODX - how much space would BHP need? 20,000? 40,000? 60,000? Surely theres a guesstimate on that?

Phoenix Copper buys tenement near Burra Monster Mine

Phoenix Copper (ASX:PNX) will expand its tenement holdings in the Burra region in northern South Australia when it completes the purchase of a significant tenement directly adjacent to its Burra Project. The Company has agreed, subject to necessary ministerial approval, to purchase tenement EL 3549 from Copper Range Limited (ASX:CRJ).

When completed this acquisition will give the Company exclusive exploration access to 1,183 km2 in the Burra region.

The 314km2 tenement sits immediately south of and adjacent to the Company’s highly prospective Central Burra tenement, within the boundaries of which the famous Burra Monster Mine – once the world’s second largest copper mine.

The purchase price for EL 3549 is $50,000 cash, the issue to Copper Range Limited of 500,000 of the Company’s fully paid ordinary shares and a 1.5% net smelter return royalty.

Phoenix Copper Managing Director Paul Dowd said the purchase of EL 3549, which contains the historic Princess Royal mine will, once completion has occurred following ministerial approval, provide the Company with an expanded opportunity to continue its regional approach to exploration in this highly significant yet largely ignored mineral province.

“During our exploration to the south of Burra it was clear that two anomalous copper trends within our tenement’s extended beyond the southern boundary and into the tenement owned by Copper Range,” Mr Dowd said.

“Given that we believe the extent and size of the mineralisation in the Burra region is only now emerging, we saw this purchase as an important step in being able to create a ‘big picture’ of exploration opportunities across the whole region.”