Mining the Pilbara 2013
The Pilbara - Growth, Prosperity, Opportunity
Dr Ken King Chief Executive Officer
Pilbara Development Commission
Wednesday 17 July 2013
The catalyst for regional growth and development
Leader, Advocate, Broker and Innovator
The Pilbara Development Commission
The Pilbara, Australia’s Global Economic Hub
• In 2011/12 the Pilbara (on and off shore) was responsible for some $84 billion of minerals and petroleum production, 81 per cent of total WA production by value. This is shown in the chart below.
PILBARA ECONOMY
Source DMP 2012
• The Pilbara Gross Regional Product (GRP) using the production approach represents: • 38% of Western Australia’s GSP • 5.5% of Australia's GDP • 50% of New Zealand’s GDP.
• The Pilbara’s GRP is greater than the individual GDP
of 123 of the world’s 185 nation states. • The Pilbara currently supports some 45,000 jobs
with 40% of these part of the broader economy. Sources: Pilbara Development Commission - www.pdc.wa.gov.au 2010 International Monetary Funds list of GDP
PILBARA ECONOMY
Understanding our regional economy
• Mining and construction is fundamental to the
growth and development of the Pilbara
economy and provides ongoing prosperity.
• Mining (74.6%), Construction (8.1%) and
Manufacturing (5.2%) total some 90% of the
economy now and will continue to do so.
• Operations and maintenance in the resource
sector together with economic diversification
and normalisation provide opportunity for the
Pilbara going forward with an estimated 20%
increase in employment required by 2020.
Sources: www.pdc.com.au
CME / PWC Pilbara Population and Employment Study 2012
http://www.economicprofile.com.au/pilbara#
PILBARA ECONOMY
PILBARA GROWTH
Key areas of growth in the Pilbara:
• Population – currently 62,000
• Resource demand and investment
• Employment – doubled since 2006
• Construction – value add opportunities
• Service industries – community and industry support services
The Pilbara has low unemployment (2.6%) and an annual average population growth rate of 2.5% over the period 2006 to 2011. Source: ABS 2011
Karratha's population grew at over three times this rate and five times the national average!
PILBARA INDUSTRY INVESTMENTS
$100 billion plus estimated investment over 5-7 years going forward IRON ORE • Rio Tinto - $10 billion • BHP - $7 billion • Fortescue Metals - $7.5 billion • CITIC Pacific - $8 billion • Hancock Prospecting (Roy Hill) - $9 billion
LNG • Chevron - $52 billion (Gorgon) • Chevron - $29 billion (Wheatstone) • North West Shelf Joint Venture • Woodside - Pluto and Browse FLNG
MANUFACTURING • Yarra International - $600 million
OPERATIONS & MAINTENANCE – jobs for Pilbara residents
To build the population of Karratha and Port Hedland into cities of 50,000 residents each and for Newman to become a major town of 15,000 residents by 2035, with other Pilbara
towns also growing into more attractive, sustainable communities.
Pilbara Cities Vision
THE P ILBARA IN
2035
• Sustainable and diverse economy • Normalised market for land and accommodation • Family oriented communities with active arts and
culture, diverse retail and entertainment options • High quality health and education choices • Vibrant tourism industry • Engineering and support services for the resource
sector supported by a global transport hub • Sustainable integrated energy system • Sustainable water supply • Public and private funding of infrastructure • Aboriginal people are engaged and benefiting from
regional prosperity • A sustainable not-for-profit sector • A world leader in environmental and social
sustainability • Strong national and international investment • Strong security presence
PILBARA CIT IES FOCUS
Commenced July 2010 to realise the vision of building cities and improving regional towns:
• Infrastructure;
• Land availability and development;
• Community projects and engagement; and
• Economic Diversification.
$1.2 billion of initiatives to transform the Pilbara and cater for growth in the region.
Source: WA Department of Regional Development and Lands
PILBARA CIT IES PLANNING
Key planning frameworks have been developed to provide the strategy for future growth of the Pilbara:
• Pilbara Panning and Infrastructure Framework;
• Karratha City of the North – City Growth Plan;
• Pilbara's Port City Growth Plan – Port Hedland;
• Newman Revitalisation Plan; and
• Onslow Expansion Plan.
Source: WA Department of Regional Development and Lands
KEY DRIVERS OF CHANGE
• Continued Royalties for Regions funding • Growing awareness and focus on the Pilbara • Reducing cost of land and housing • Resource sector moving from construction to
operational phase - focus on production and productivity
• Growth of Asian markets • State Government focus on addressing
Aboriginal disadvantage • Growing capacity of Aboriginal corporations • Government interest in agriculture and food
security • Cost of doing business
PDC PRIORITY AREAS
DIVERSITY
• Economic Diversity • Liveable
Communities
PLANNING AND INFRASTRUCTURE
• Land Supply and
Accommodation • Core Infrastructure
STRATEGY
• Strategy, research
and policy • Knowledge Hub • Promoting the
Pilbara globally
STRATEGY
Areas of Focus • Regional Knowledge Hub • Promoting the region globally • Facilitating a shared vision and approach for the
Pilbara’s future • Collaborating with regional stakeholders
Projects • Regional Investment Blueprint • Regional Positioning Strategy • Regional Action Plan Partners • Government and Government Business Enterprises • Regional Development Australia • Non-Government Organisations • Aboriginal Corporations
ECONOMIC DIVERSIF ICATION
To secure the sustainability of communities in the Pilbara, the region needs to diversify its economy. Key Opportunities include: • Tourism and short stay accommodation • Local fabrication and industry support for both
onshore and offshore - e.g. PFSCUF at Port Hedland • Food Security and Fibre Production • Defence operations and services • Alternative energy generation – e.g. renewables • SME development:
• Tourism and Hospitality • Business Incubation for new and existing SMEs • Increasing commercial retail premises • Digital technology uptake • Increased market opportunities
L IVEABLE COMMUNITIES
To achieve the vision vibrant and thriving towns and cities are developing in the Pilbara with a focus on: • Social infrastructure and amenity • Education and Health • Communications and connectivity Current Place Activation Projects • Karratha City Centre /Health Campus -$500m • Pilbara Health Partnership - $38.2 million • Pilbara Education Partnership - $30 million • Recreational Facilities (e.g. Wanangkura
Stadium, Karratha Leisureplex, Onlsow Multi-purpose Centre, Tom Price Sporting Pavilion)
• Dampier, Wickham and Paraburdoo Community Hubs
LAND SUPPLY AND ACCOMMODATION
• The Pilbara Development Commission closely monitors the housing supply pipeline from early stage development, subdivision approval, clearance and subsequent builds.
• Current data and projections to 2017 indicate
that supply is meeting demand with the following developments planned:
• The Town of Port Hedland - 14,200 dwellings • Karratha - 6,900 dwellings • Newman - 1,684 dwellings
• Onslow - 1,496 dwellings
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
$2,200
$2,400
$2,600
1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4
2007 2008 2009 2010 2011 2012 2013
Rental Cost
Year
Advertised Residential Rental Cost (Average), Pilbara
Port Hedland Average Rental
CostSouth Hedland Average Rental
CostsKarratha Average Rental Costs
Newman Average Rental Costs
Source: Realestate.com.au
HOUSING AND LAND PRICE TRENDS
COMMERCIAL PROPERTY
0
10
20
30
40
50
60
70
80
$-
$100
$200
$300
$400
$500
$600
$700
$800
Sept to Dec 2012 Jan to Mar 2013 Mar to Jun 2013
Retail volume
Office Volume
Retail average price sqm2
Office average price sqm2
INFRASTRUCTURE
Power projects • Pilbara Underground Power Project - $100 million spent to date • Pilbara Power Board – Investment in a new Pilbara Power
Station in Port Hedland – 110 MW, $140 million • Renewables and alternative energy - waste/solar/bio fuels Water • Investigating new sources (West Canning Basin) • New sources (Chevron in Onslow) Waste Treatment • Port Hedland Waste Water Treatment and plant relocation • Karratha Water Recycling Project • Newman Onslow waste water treatment upgrades Transport • Regional airports – Karratha, Hedland, Newman and Onslow • Road / rail upgrades and PortLink Road ($3.4515 billion) • Pilbara Ports – import opportunities for Hedland and Dampier Communications • NBN, Nextgen Networks, Fujitsu, Google, Trident • Smarter Cities initiatives and Pilbara Digital Flagship
RfR Projects in the Pipeline / in Progress:
• Pilbara Underground Power - $75 million
• Pilbara Fabrication and Services Common Use Facility , Port Hedland - $6-800 million ($5 million RfR)
• Port Hedland Marina - $152 million ($72 million RfR)
• Water for Pilbara Cities - $28.5 million ($3.862 million RfR)
• Port Hedland Wastewater Treatment Plant - $42 million
• Karratha Health Campus - $207 million
• Pilbara Education Fund - $50 million
• Pilbara Indigenous program - $30 million
• Pilbara Health Partnership - $38.2 million
• Pilbara Cities Community projects - $30 million
• Local Government Support project - $3 million
TARGETED PROJECTS
COMMERCIAL PROJECTS
An artists impression of the $65 million Karratha Hilton Hotel – 8 stories, 144 rooms, 22 serviced apartments
SUSTAINABILTY
Community challenges and pressure points: • Housing and accommodation – short and long stay
• Land supply and release
• Demand for utilities – power, water, telecommunications etc.
• Infrastructure capabilities – roads, airports etc.
• Community services demand and supply – health, education, police, child care etc.
• Attraction and retention of workforces
• Fly-In-Fly-Out workforces vs long term residents
• SME growth and development
• Institutional establishment
Relieve the pressure, normalise the economy and develop sustainable communities
T: 1800 THE PILBARA (1800 843 745) E: [email protected] W: www.pdc.gov.au
PORT HEDLAND OFFICE Shop 2, 6 Wedge Street
PO Box 544 Port Hedland, Western Australia 6721
As publishers of this presentation the Pilbara Development Commission makes every reasonable effort to ensure the accuracy of all information. Nevertheless, the Commission is unable to guarantee the accuracy of all of the information contained. The Commission takes no responsibility and will not be liable either in contract for negligence or in any other way for any errors, acts or omissions, which may occur in relation to it.
KARRATHA OFFICE Suite 49, 5 Sharpe Avenue
PO Box 294 Karratha, Western Australia 6714
PERTH OFFICE Level 2, 16 Parliament Place
PO Box 51 West Perth, Western Australia 6872
Thank You!