❓ Mr. Punch asks about the McGowan government's support for the lithium industry. The Minister details investments, royalty changes, job growth, and downstream processing advancements, highlighting WA's growing role in the global battery industry.
AnsweredQoN 939Legislative Assembly
QuestionView source ↗
LITHIUM INDUSTRY
939. Mr D.T. PUNCH to the Minister for Mines and Petroleum:
My question is to the very astute
Minister for Mines and Petroleum.
I
refer to the continuing expansion of the lithium industry in Western Australia.
Can the minister explain to the house how the McGowan Labor government
is providing investment certainty to Western Australia's lithium
industry and how this provides greater opportunities to create jobs and further
develop downstream processing in our state?
939. Mr D.T. PUNCH to the Minister for Mines and Petroleum:
My question is to the very astute
Minister for Mines and Petroleum.
I
refer to the continuing expansion of the lithium industry in Western Australia.
Can the minister explain to the house how the McGowan Labor government
is providing investment certainty to Western Australia's lithium
industry and how this provides greater opportunities to create jobs and further
develop downstream processing in our state?
AnswerView source ↗
What
an excellent question. One of the great things about our future battery
industry is that much of it is happening outside Perth. The member for Bunbury
is one of those who enjoys the growth in employment in our battery industry
with Albemarle's decision, with the support of the Premier, to invest
in Kemerton to create one of the world's largest lithium hydroxide
plants. This year, we are looking forward to the first production of lithium
hydroxide from the Tianqi plant in Kwinana. This, together with other
investment by Sociedad Qu�mica y Minera de Chile and Wesfarmers, will see
within five years, Western Australia become the single largest source outside
China of lithium hydroxide—that is processed material—which
will give Western Australia a unique and strong position in the future battery
industry as batteries replace internal combustion engines across the world in
automotive production. The government works very closely with the industry to
make sure that we are listening to its needs. Again, I highlight a decision we
made, which is to change the basis of the royalty on lithium hydroxide.
Lithium hydroxide and lithium carbonate would have been subject to a royalty of
five per cent if we had taken no action. This
would have put the royalty rate on processed lithium at an uncompetitive rate
compared with the case in other jurisdictions and would have been an impediment
to support future investment in the processing of lithium material in Western Australia.
With the support of cabinet, we have set the royalty rate as a feedstock rate,
which means that whether the spodumene that comes out of the concentrators at
mines is exported or used for domestic use, the royalty will be applied in
exactly the same way. Let me make it clear: had we left the royalty
regime in the way that it had been left to us, there would have been
effectively a disincentive to process
spodumene in Australia. In fact, there would have been incentive to send the
spodumene outside Australia to be processed overseas.
Our battery industry strategy is
working. I report to the house that there has been an 83 per cent increase in
employment since the last year of the former government just in the mining of
battery materials. In 2016, there were 6 320 people employed in mining battery
materials. This year, there are 11 590. That is an extra 5 000 jobs just in the
mining industry. Of course, there are even more jobs in the processing.
Downstream processing of battery materials did not happen until the Labor
government came into power, and now we are moving to be the dominant player
outside China in this industry. We are very keen to support further chemical
processing of battery materials in Western Australia, and I want to
congratulate BHP's Nickel West for its investment in nickel sulphate
and cobalt sulphate capacity. That is new capacity and new chemicals being
processed here in Western Australia that takes us another step down the pathway
of this important industry.
I also want to let members know that
there is now 7.5 megawatt hours in battery storage across Western Australia from state government initiatives, which shows that
we are advancing not only at the beginning of the value chain, but also
in the implementation of using batteries and systems. Western Australia is now
recognised as a world-leading jurisdiction in the application of batteries into
electrical systems, and people are literally coming from all around the world
to learn about how to do that here in Western Australia. This is a good news
story because the McGowan government is working with industry to support these
important investments.
an excellent question. One of the great things about our future battery
industry is that much of it is happening outside Perth. The member for Bunbury
is one of those who enjoys the growth in employment in our battery industry
with Albemarle's decision, with the support of the Premier, to invest
in Kemerton to create one of the world's largest lithium hydroxide
plants. This year, we are looking forward to the first production of lithium
hydroxide from the Tianqi plant in Kwinana. This, together with other
investment by Sociedad Qu�mica y Minera de Chile and Wesfarmers, will see
within five years, Western Australia become the single largest source outside
China of lithium hydroxide—that is processed material—which
will give Western Australia a unique and strong position in the future battery
industry as batteries replace internal combustion engines across the world in
automotive production. The government works very closely with the industry to
make sure that we are listening to its needs. Again, I highlight a decision we
made, which is to change the basis of the royalty on lithium hydroxide.
Lithium hydroxide and lithium carbonate would have been subject to a royalty of
five per cent if we had taken no action. This
would have put the royalty rate on processed lithium at an uncompetitive rate
compared with the case in other jurisdictions and would have been an impediment
to support future investment in the processing of lithium material in Western Australia.
With the support of cabinet, we have set the royalty rate as a feedstock rate,
which means that whether the spodumene that comes out of the concentrators at
mines is exported or used for domestic use, the royalty will be applied in
exactly the same way. Let me make it clear: had we left the royalty
regime in the way that it had been left to us, there would have been
effectively a disincentive to process
spodumene in Australia. In fact, there would have been incentive to send the
spodumene outside Australia to be processed overseas.
Our battery industry strategy is
working. I report to the house that there has been an 83 per cent increase in
employment since the last year of the former government just in the mining of
battery materials. In 2016, there were 6 320 people employed in mining battery
materials. This year, there are 11 590. That is an extra 5 000 jobs just in the
mining industry. Of course, there are even more jobs in the processing.
Downstream processing of battery materials did not happen until the Labor
government came into power, and now we are moving to be the dominant player
outside China in this industry. We are very keen to support further chemical
processing of battery materials in Western Australia, and I want to
congratulate BHP's Nickel West for its investment in nickel sulphate
and cobalt sulphate capacity. That is new capacity and new chemicals being
processed here in Western Australia that takes us another step down the pathway
of this important industry.
I also want to let members know that
there is now 7.5 megawatt hours in battery storage across Western Australia from state government initiatives, which shows that
we are advancing not only at the beginning of the value chain, but also
in the implementation of using batteries and systems. Western Australia is now
recognised as a world-leading jurisdiction in the application of batteries into
electrical systems, and people are literally coming from all around the world
to learn about how to do that here in Western Australia. This is a good news
story because the McGowan government is working with industry to support these
important investments.
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