❓ Opposition questions the Premier's apparent change in attitude towards BHP's iron ore export volumes, given his previous support for the Jimblebar mine expansion. Premier defends his position by highlighting the depressed iron ore market and the state's interest in maximizing royalty income.
AnsweredQoN 776Legislative Assembly
QuestionView source ↗
IRON ORE EXPORT VOLUMES — PREMIER'S
COMMENTS
776. Mr B.S. WYATT to the
Premier:
I acknowledge the students from Mandurah Catholic College in
the public gallery, on behalf of the member for Mandurah who had them up for
lunch today.
I thank all members for their very kind words about my father
over the last few weeks. After those kind words, I will try to generate some
heat!
I refer to the Premier's media statement dated 23
April 2014 titled ''Jimblebar mine another boost for Pilbara economy''
and to a picture in which the Premier is positively glowing at the opening of
that mine, alongside Jimmy Wilson. I note that the Premier's media
statement celebrates the opening of Jimblebar mine, which boosted BHP's
iron ore export volumes ahead of schedule. The Premier congratulated BHP on
this faster than anticipated expansion and said that it —
� demonstrates BHP Billiton's
ongoing confidence in the strength of WA's iron ore industry,''�
I remember this in April this year. Why is the Premier so
shocked and angry that BHP is increasing its iron ore volumes?
COMMENTS
776. Mr B.S. WYATT to the
Premier:
I acknowledge the students from Mandurah Catholic College in
the public gallery, on behalf of the member for Mandurah who had them up for
lunch today.
I thank all members for their very kind words about my father
over the last few weeks. After those kind words, I will try to generate some
heat!
I refer to the Premier's media statement dated 23
April 2014 titled ''Jimblebar mine another boost for Pilbara economy''
and to a picture in which the Premier is positively glowing at the opening of
that mine, alongside Jimmy Wilson. I note that the Premier's media
statement celebrates the opening of Jimblebar mine, which boosted BHP's
iron ore export volumes ahead of schedule. The Premier congratulated BHP on
this faster than anticipated expansion and said that it —
� demonstrates BHP Billiton's
ongoing confidence in the strength of WA's iron ore industry,''�
I remember this in April this year. Why is the Premier so
shocked and angry that BHP is increasing its iron ore volumes?
AnswerView source ↗
The Treasurer has just advised me—I am sure he is
correct—that back in April the iron ore price was probably $110 to $120
a tonne.
Mr B.S. Wyatt : No,
it was a bit lower than that. It was well on its way down.
Mr C.J. BARNETT :
What was it—you have obviously done your research?
Mr B.S. Wyatt : It
was about the high 90s.
Mr C.J. BARNETT : A
bit better than —
Mr B.S. Wyatt :
Still on its way down!
Mr C.J. BARNETT :
Mr Speaker —
Several members interjected.
Mr C.J. BARNETT :
It is a good photo, is it not? Unlike previous governments, major resource
development projects are happening.
Several members interjected.
Mr C.J. BARNETT :
It is true. Look right around the state.
Mrs M.H. Roberts :
You are having it both ways!
Mr C.J. BARNETT :
It is the same question, basically. Iron ore prices were $110 or the high 90s,
whatever it was at the time—they were lower than they had been—but
there was a pretty solid iron ore price. I happen to think the real value of iron ore is probably around
$110 to $120 a tonne, but the market is nowhere near that at the moment.
Several members interjected.
Mr C.J. BARNETT :
Mr Speaker, I just cannot even hear myself.
The opposition should tell me the logic of pouring iron ore
into a depressed market.
Several members interjected.
The SPEAKER :
Member for West Swan, I call you to order for the first time.
Mr C.J. BARNETT :
When does the opposition reckon construction started on the Jimblebar mine? It
was probably two years before that. It is a good thing. As I said before, we
reached a historic agreement with the two major iron ore producers that
resulted in a massive inflow of cash in terms of increasing their royalty rate
to the standard in the Mining Act. That was used to fund about 50 per cent of
Perth Children's Hospital. Part of that was that it made it easier for
them to expand, and I support that. As I said before, I expect iron ore
production to double over the course of this decade. What I do not expect the
companies to do when there is a sharp fall in price is pour more iron ore into
a very depressed market; that is not commercially sound for them and their
shareholders, and it is not good for the state.
Mr
M. McGowan : Let Kazakhstan does it.
Mr
C.J. BARNETT : Sorry?
Mr
M. McGowan : Let Brazil do it. Is that your —
Mr
C.J. BARNETT : Is the Leader of the Opposition a paid lobbyist for the
mining companies? He is behaving like one! He is behaving like a lobbyist in
this place! The state has —
Several members interjected.
Mr
C.J. BARNETT : Mr Speaker, this is pointless.
As I said before, the state has a
role in the governance of the progressive development of our natural resources.
We want them to be sold at a valuable, true market value; it is not in our
interests to see that iron ore poured into the market when the market is
depressed by 40 per cent—in real terms probably about 20 per cent. We
have a commercial interest not only in collecting royalties, but also as the
owner of the iron ore. That is what I reminded the companies of: ''Remember
who your landlord is. Remember who owns the iron ore. Remember who has a direct
interest in terms of royalty income.'' They have been reminded, and they
have responded accordingly.
correct—that back in April the iron ore price was probably $110 to $120
a tonne.
Mr B.S. Wyatt : No,
it was a bit lower than that. It was well on its way down.
Mr C.J. BARNETT :
What was it—you have obviously done your research?
Mr B.S. Wyatt : It
was about the high 90s.
Mr C.J. BARNETT : A
bit better than —
Mr B.S. Wyatt :
Still on its way down!
Mr C.J. BARNETT :
Mr Speaker —
Several members interjected.
Mr C.J. BARNETT :
It is a good photo, is it not? Unlike previous governments, major resource
development projects are happening.
Several members interjected.
Mr C.J. BARNETT :
It is true. Look right around the state.
Mrs M.H. Roberts :
You are having it both ways!
Mr C.J. BARNETT :
It is the same question, basically. Iron ore prices were $110 or the high 90s,
whatever it was at the time—they were lower than they had been—but
there was a pretty solid iron ore price. I happen to think the real value of iron ore is probably around
$110 to $120 a tonne, but the market is nowhere near that at the moment.
Several members interjected.
Mr C.J. BARNETT :
Mr Speaker, I just cannot even hear myself.
The opposition should tell me the logic of pouring iron ore
into a depressed market.
Several members interjected.
The SPEAKER :
Member for West Swan, I call you to order for the first time.
Mr C.J. BARNETT :
When does the opposition reckon construction started on the Jimblebar mine? It
was probably two years before that. It is a good thing. As I said before, we
reached a historic agreement with the two major iron ore producers that
resulted in a massive inflow of cash in terms of increasing their royalty rate
to the standard in the Mining Act. That was used to fund about 50 per cent of
Perth Children's Hospital. Part of that was that it made it easier for
them to expand, and I support that. As I said before, I expect iron ore
production to double over the course of this decade. What I do not expect the
companies to do when there is a sharp fall in price is pour more iron ore into
a very depressed market; that is not commercially sound for them and their
shareholders, and it is not good for the state.
Mr
M. McGowan : Let Kazakhstan does it.
Mr
C.J. BARNETT : Sorry?
Mr
M. McGowan : Let Brazil do it. Is that your —
Mr
C.J. BARNETT : Is the Leader of the Opposition a paid lobbyist for the
mining companies? He is behaving like one! He is behaving like a lobbyist in
this place! The state has —
Several members interjected.
Mr
C.J. BARNETT : Mr Speaker, this is pointless.
As I said before, the state has a
role in the governance of the progressive development of our natural resources.
We want them to be sold at a valuable, true market value; it is not in our
interests to see that iron ore poured into the market when the market is
depressed by 40 per cent—in real terms probably about 20 per cent. We
have a commercial interest not only in collecting royalties, but also as the
owner of the iron ore. That is what I reminded the companies of: ''Remember
who your landlord is. Remember who owns the iron ore. Remember who has a direct
interest in terms of royalty income.'' They have been reminded, and they
have responded accordingly.
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