diamond (ashton joint venture) … australia. diamond (ashton joint venture) agreement. no. 12 of...

WESTERN AUSTRALIA.

DIAMOND (ASHTON JOINT

VENTURE) AGREEMENT.

No. 12 of 1983.

AN ACT to amend the Diamond (Ashton JointVenture) Agreement Act 1981.

[Assented to 31 October 1983.]

BE it enacted by the Queen's Most ExcellentMajesty, by and with the advice and consent

of the Legislative Council and the LegislativeAssembly of Western Australia, in this presentParliament assembled, and by the authority of thesame, as follows:—

1. (1) This Act may be cited as the Diamond Shorttt le.

(Ashton Joint Venture) Agreement AmendmentAct 1983.

(2) In this Act the Diamond (Ashton Joint lo'f8U2.: "8Venture) Agreement Act 1981 is referred to as theprincipal Act.

Section 1repealed andsubstituted.

Section 2amended.

Section 3Ainserted.

Section 5amended.

No. 12.] Diamond (Ashton Joint [1983.Venture) Agreement.

2. The principal Act is amended by repealingsection 1 and substituting the following section—.

" 1. This Act may be cited as the Diamond(Argyle Diamond Mines Joint Venture)Agreement Act 1981-1983. ".

3. Section 2 of the principal Act is amended

(a) by deleting the full stop at the end of thesection and substituting a semicolon; and

(b) by inserting at the end of the section thefollowing definition-

1f "the Supplementary Agreement"means the agreement of which acopy is set out in Schedule 3 tothis Act. ".

4. After section 3 of the principal Act, the follow-ing section is inserted

if

3A. The Supplementary Agreement isapproved and ratified. ".

5. Section 5 of the principal Act is amendedin subsection (1) by inserting after "date" thefollowing-

" as defined in section 6 (1) ".

Section 29amended. 6. Section 29 of the principal Act is amended in

subsection (2) by deleting "goods" in subparagraph(vi) of paragraph (b) and substituting thefollowing-

" property ".

1983.] Diamond (Ashton Joint [No. 12.Venture) Agreement.

7. After Schedule 2 to the principal Act thefollowing Schedule is added

SCHEDULE 3.

THIS AGREEMENT is made the 11th day of October 1983,BETWEEN THE HONOURABLE BRIAN THOMAS BURKE,M.L.A., Premier of the State of Western Australia, actingfor and on behalf of the said State and its instrumentalitiesfrom time to time (hereinafter called "the State") of thefirst part NEW BROKEN HILL CONSOLIDATED LIMITEDa company deemed by Act of Parliament of the State ofVictoria to be incorporated in the State of Victoria andhaving its principal place of business in the State of WesternAustralia at 18th Floor, 191 St. George's Terrace, Perth(hereinafter called "NBHC"), THE ZINC CORPORATION,LIMITED a company deemed by Act of Parliament of theState of Victoria to be incorporated in the State of Victoriaand having its principal place of business in the State ofWestern Australia at 18th Floor, 191 St. George's Terrace,Perth (hereinafter called "ZC"), ASHTON MININGLIMITED a company incorporated in the State of Victoriaand having its principal place of business in the State ofWestern Australia at 6th Floor, 189 St. George's Terrace,Perth (hereinafter called "Ashton"), TANAUSTPROPRIETARY LIMITED a company incorporated in theState of Victoria and having its principal place of businessin the State of Western Australia at 2nd Floor, CecilBuilding, 6 Sherwood Court, Perth (hereinafter called"Tanaust"), A.O. (AUSTRALIA) PTY. LIMITED a companyincorporated in the State of Victoria and having its principalplace of business in the State of Western Australia at 6thFloor, 189 St. George's Terrace, Perth (hereinafter called"AO") and NORTHERN MINING CORPORATION N.L. acompany incorporated in the State of Victoria and havingits principal place of business in the State of WesternAustralia at 2nd Floor, 31 Ventnor Avenue, West Perth(hereinafter called "Northern Mining") of the second part(the said parties of the second part being hereinaftercollectively called "the Joint Venturers" in which term shallbe included their respective successors and permitted assignsand appointees) and CRA LIMITED a company incorporatedin the State of Victoria and having its principal place ofbusiness in the State of Western Australia at 191 St. George'sTerrace, Perth, (hereinafter called "the Guarantor") of thethird part.

WHEREAS:

(a) on the 17th day of November, 1981 the State, CRAExploration Pty. Limited, Ashton, Tanaust, AO, NorthernMining and the Guarantor entered into an agreement

Schedule 3added.


which was ratified by the Diamond (Ashton JointVenture) Agreement Act 1981 and is hereinafter referredto as "the principal Agreement";

(b) by an agreement effective as from the 1st day of July,1982 CRA Exploration Pty. Limited assigned all itsinterest in and under the principal Agreement to NBHCand ZC; and

(c) the parties have agreed to new arrangements in respectof the accommodation of the Joint Venturers' mineworkforce and royalty payable under the principalAgreement and desire to vary the principal Agreement.

NOW THIS AGREEMENT WITNESSETH:

1. Subject to the context the words and expressions usedin this Agreement have the same meanings respectivelyas they have in and for the purpose of the principalAgreement.

2. The provisions of this Agreement shall not come intooperation until a Bill to approve and ratify this Agree-ment is passed by the Legislature of the said State andcomes into operation as an Act.

3. The principal Agreement is hereby varied as follows

(1) Clause 1-

(a) by deleting the definition of "relevant town"and substituting the following-

" "relevant town" means in relation to theArgyle mining area and the Ellendale miningarea respectively a town established in theKimberley region by the Joint Venturers as ahousing area for their mine workforce pursuantto an approved proposal and may in either casewith the approval of the Minister include anexisting town;";

(b) by deleting in the definition of "relevant town-site", "the relevant town" and substituting thefollowing

"a relevant town".

(2) Clause 7 subclause (1)-

(a) by deleting the following

"shall make provision where appropriate for thenecessary workforce and associated populationrequired to enable the Joint Venturers to mineand recover diamonds from ore from the areathe subject of the proposals and";


(b) by deleting paragraph (c) and substituting thefollowing paragraphs

"(c) accommodation for the mine workforce inthe Kimberley region comprising, in thediscretion of the Joint Venturers, any oneor more of the following-

(i) establishment of a relevant town;

(ii) assimilation into any existing town;

and

(iii) establishment of accommodationfacilities for the mine workforce tocommute from elsewhere within thesaid State

including the provision of utilities, servicesand associated facilities;

(cc) any arrangements to commute the mineworkforce from any place or places withinthe said State desired by the JointVenturers;".

(3) Clause 21 subclause (9)—

by deleting subclause (9) and substituting the fol-lowing subclauses-

"(9) Notwithstanding that the Joint Venturers haveinstalled equipment to generate electricity atthe Argyle mining area pursuant to the provi-sions of subclause (3) of this Clause, the JointVenturers shall upon request by the State atany time or times before 31st December, 1988enter into negotiations with the State EnergyCommission with a view to the establishment onterms and conditions to be agreed betweenthe State Energy Commission and the JointVenturers of hydro electric generation workson the Ord River and distribution works tosupply, inter alia, the Argyle mining area andany relevant town at the Argyle mining area.

(10) Subject to subclause (9) of this Clause andnotwithstanding that they have installedequipment to generate electricity at theArgyle mining area pursuant to the provisionsof subclause (3) of this Clause, the JointVenturers may during the continuance of thisAgreement enter into negotiations with the


State Energy Commission with a view toobtaining further or alternative electricity forthe Argyle mining area and any relevant townat the Argyle mining area.

(11) The provisions of subclauses (9) and (10) ofthis Clause shall not oblige the Joint Venturersor the State Energy Commission to enter intoany agreement with the other pursuant to anynegotiations under those subclauses and theprovisions of subelause (1) of this Clause shallnot apply to any such negotiations or to anyagreement that may result from thosenegotiations.".

(4) By inserting after Clause 24 the following clauses

Provision formineworkforce.

Modificationof MinesRegulationAct.

"24A. The Joint Venturers shall make provisionfor the mine workforce serving the Argylemining area and the Ellendale mining arearespectively in any one or more (in theirdiscretion) of the following ways

(a) commuting the mine workforce on aregular basis, as determined by the JointVenturers in accordance with approvedproposals, from any place or placeswithin the said State to the relevantmining area and the provision ofnecessary accommodation facilities at orin the vicinity of the relevant miningarea;

(b) the establishment of a relevant town;

(c) the assimilation of the mine workforceinto any existing town in the Kimberleyregion.

24B. (1) For the purpose of this Agreement inrespect of any mining operations of theJoint Venturers under this Agreementthe Mines Regulation Act 1946 shall,where such mining operations are beingconducted in accordance with a scheduleof work approved by the Minister forMines, be deemed to be modified by thedeletion of paragraph (c) of subsection(1) of section 38.

(2) Where in the opinion of the Minister forMines any schedule of work approvedfor the purpose of subclause (1) of thisClause should be altered for reasons ofsafety the Joint Venturers shall consult


with the Minister for Mines with a viewto making any alterations to thatschedule as the Minister may considerreasonable in the circumstances.".

(5) Clause 25-

(a) subclause (1)by deleting "Should the approved proposals" andsubstituting the following"Where any approved proposals";

(b) subclause (4)by deleting "If the approved proposals" andsubstituting the following"Where any approved proposals";

(c) subclause (5)by deleting "Should the approved proposals"and substituting the following

"Where any approved proposals";

(d) subclause (6)by deleting "the relevant townsite" and sub-stituting the following"a relevant townsite".

(6) By deleting Clause 26.

(7) Clause 29-

(a) subclause (1)-

(i) by inserting in paragraph (I) of the defini-tion of "allowable deductions" after "thisAgreement" the following

"or the Act to ratify the agreement dated11th October, 1983 varying this Agreement";

(ii) by inserting in paragraph (v) of the defini-tion of "allowable capital expenditure"after "and", where it last occurs, the fol-lowing"any";

(b) subelause (5) paragraph (c)—

( i) by inserting after "paid" where it firstoccurs the following

"or where any offset has or offsets have beendeducted pursuant to Clause 29C, theestimated royalty that would have been paidbut for that offset or those offsets";


Furtherroyaltyprovisions.

(ii) by inserting after "period" where it occursin subparagraph (i) and in subparagraph(ii) the following"but excluding any offsets deductedtherefrom pursuant to Clause 29C".

(8) By inserting after Clause 29 the following clauses

"29A. The Joint Venturers shall pay to the State(a) royalties in the manner and at the

times provided in Clause 29 and anyincrease thereto pursuant to subclause(6) of Clause 30; and

(b) an additional royalty under this Agree-ment in the manner and at the timesprovided in Clause 29B.

29B. (1) The Joint Venturers shall pay to theState an additional royalty of $50,000,000in the manner and at the timesfollowing(a) as to $25,000,000 or such lesser

amount as the Minister may allow,within 7 days after the date ofapproval by the Minister of theproposals submitted by the JointVenturers pursuant to paragraph(B) of subclause (1) of Clause 7(hereinafter called "the approvaldate"); and

(b) as to the balance, within 45 days ofthe approval date or within suchlater time or times as the Ministermay allow.

(2) If the amount of $25,000,000 referred toin paragraph (a) of subclause (1) ofthis Clause or such lesser amount as theMinister may allow as therein providedis not paid by the Joint Venturers tothe State within 30 days of the cominginto operation of the Act to ratify theagreement dated 11th October, 1983varying this Agreement, the JointVenturers shall pay interest at the rateof 14% per annum on the said sum of$50,000,000 for the period from whicheveris the later of 14th November, 1983 orthe approval date to the date on whichthe said amount of $25,000,000 (or suchlesser amount as aforesaid) is paid tothe State such interest to be paid to theState at the time of payment of the saidsum of $25,000,000 (or such lesser amountas aforesaid).


(3) The Joint Venturers shall on demand bythe State from time to time pay to theState interest at the rate of 14% perannum on so much of the said sum of$50,000,000 as may from time to timeafter the expiration of 7 days from theapproval date be unpaid.

29C. (1) Subject to subclause (2) of this Clause,the amount of royalties that become duefor payment by the Joint Venturers inrespect of diamonds recovered from theareas the subject of this Agreementunder Clause 29 and any increase theretopursuant to subclause (6) of Clause 30 inrespect of each quarter set forth in theSchedule below shall be partially offsetby the amount shown as the scheduledoffset amount for each quarter.

SCHEDULE.Production Year(commencing Quarter1st January)1986 First

SecondThirdFourth

1987 .... FirstSecondThirdFourth

1988 FirstSecondThirdFourth

1989 .... FirstSecondThirdFourth

1990 .... FirstSecond .ThirdFourth ...

1991 First .Second ..ThirdFourth

1992 FirstSecond .ThirdFourth ..

1993 .... First ...SecondThird .Fourth .

ScheduledOffset

Amount $1,000,000$1,000,000$1,000,000$1,000,000$1,625,000$1,625,000$1,625,000$1,625,000$1,875,000$1,875,000$1,875,000$1,875,000$2,000,000$2,000,000$2,000,000$2,000,000$1,500,000$1,500,000$1,500,000$1,500,000$1,500,000$1,500,000$1,500,000$1,500,000$2,000,000$2,000,000$2,000,000$2,000,000$1,000,000$1,000,000$1,000,000$1,000,000


(2) Whenever the scheduled offset amountfor a quarter plus any amount addedthereto as hereinafter provided exceeds50% of the royalty otherwise due forpayment in respect of that quarter theamount that may be offset for thatquarter shall be limited to an amountequal to 50% of that royalty and theexcess together with interest on suchexcess at the rate of 14% per annumcalculated from the date of payment ofthe royalty for the quarter to which theexcess relates to (subject to the provisofirst hereinafter contained) whichever isthe sooner of the date upon whichroyalty in respect of such succeedingquarter is paid or the date upon whichsuch royalty becomes payable shall becarried forward and applied by theJoint Venturers to increase the scheduledoffset amount applicable to the nextsucceeding quarter by the amountcarried forward (which increasedamount shall then become the scheduledoffset amount for that quarter)PROVIDED THAT where in such suc-ceeding quarter a royalty is payable bythe Joint Venturers pursuant to sub-paragraph (i) of paragraph (c) ofsubclause (5) of Clause 29 including anyincrease effected thereto pursuant tosubclause (6) of Clause 30 the excessand the interest then accrued thereonor so much thereof as does not exceed50% of that royalty shall be retired byoffset to the extent thereof against thatroyalty AND PROVIDED FURTHER thatin the event that any such excessremains at the end of 1993 then it shallbe carried forward and applied by theJoint Venturers in the manner providedin this subclause (2) until the amountof any such excess is reduced to zero.

(3) The scheduled offset amounts mentionedin subclause (1) of this Clause shallapply in respect of any royalty, tax orother impost whatsoever that may belevied or imposed by the State at anytime in the future in lieu of royaltypayable pursuant to this Agreement.

(4) If the State takes action otherwise thanin accordance with the terms of thisAgreement whereby the Joint Venturers


lose the benefit of this Agreement anyoutstanding scheduled offset amountsshall, except where the State has takensuch action after an abandonment bythe Joint Venturers of this Agreement ortheir operations under this Agreement,become amounts owing by the State tothe Joint Venturers at the respectivetimes they would have otherwise beenavailable as offset amounts pursuant toClause 290.".

(9) Clause 30 subclause 6--

by deleting in factor R "payable pur-suant to Clause 29 for that year"

and substituting the following

"that would be payable pursuant toClause 29 for that year unaffected byany offsets deducted therefrom pursuantto Clause 29C".

(10) by deleting "the revelant town", where-ver it occurs in the principal Agreement,and substituting the following

"any relevant town".

4. The Guarantor hereby consents to this Agreement.

IN WITNESS WHEREOF this Agreement has been executedby or on behalf of the parties hereto the day and yearfirst hereinbefore mentioned.

SIGNED by the said THEHONOURABLE BRIANTHOMAS BURKE, M.L.A. inthe presence of-

MALCOLM J. BRYCE.

Minister for Economic Devel-opment and Technology

BRIAN BURKE.


SIGNED SEALED ANDDELIVERED for and on behalfof NEW BROKEN HILLCONSOLIDATED LIMITED byits duly authorised attorneyTHOMAS BARLOW underPower of Attorney dated the10th day of October, 1983 inthe presence of

M. A. O'LEARY.

(L.S.)

T. BARLOW.

SIGNED SEALED ANDDELIVERED for and on behalfof THE ZINC CORPORATION,LIMITED by its duly author-ised attorney THOMASBARLOW under Power ofAttorney dated the 10th day ofOctober, 1983 in the presenceof

M. A. O'LEARY.

(L.S.)

T. BARLOW.

SIGNED for and on behalf ofASHTON MINING LIMITEDby its duly appointed AttorneyRORY EDWARD STANLEYARGYLE under Power ofAttorney dated the 7th day ofOctober, 1983 in the presenceof

G. BILLARD.

SIGNED for and on behalf ofTANAUST PROPRIETARYLIMITED by its duly appointedAttorney RORY EDWARDSTANLEY ARGYLE underPower of Attorney dated the7th day of October, 1983 in thepresence of

G. BILLARD.

SIGNED for and on behalf ofA.O. (AUSTRALIA) PTY.LIMITED by its duly appointedAttorney RORY EDWARDSTANLEY ARGYLE underPower of Attorney dated the7th day of October, 1983 in thepresence of

G. BILLARD.

R. E. S. ARGYLE.

R. E. S. ARGYLE.

R. E. S. ARGYLE.


THE COMMON SEAL ofNORTHERN MINING COR-PORATION N.L. was hereuntoaffixed by authority of theBoard of Directors in the pre-sence ofDirector

C. L. S. HEWITT.Director

A. G. BIRCHMORE.

SIGNED SEALED ANDDELIVERED for and on behalfof CRA LIMITED by its dulyauthorised attorney THOMASBARLOW under Power ofAttorney dated the 10th dayof October, 1983 in the pre-sence of

M. A. O'LEARY.

(C.S.)

(L.S.)

T. BARLOW.

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