❓ The WA government is introducing a lithium industry support program including fee waivers and loans to assist miners and downstream processors during a period of low lithium prices, aiming to secure WA's position as a global processing hub.
AnsweredQoN 887Legislative Assembly
QuestionView source ↗
LITHIUM
INDUSTRY — GOVERNMENT SUPPORT
887. Ms A.E. KENT to the Minister for Mines and Petroleum:
I am very excited to pose this question.
Several members interjected.
Ms A.E. KENT : Sorry, it is exciting in my area. People
will be excited—trust me. I refer to the Cook Labor government's
—
Several members interjected.
Ms A.E. KENT : You are all excited now!
The SPEAKER : Sorry, pause for a moment. Pause the
level of excitement. Member for Kalgoorlie.
Ms A.E. KENT : I refer to the Cook Labor government's
commitment to supporting local jobs and diversifying the Western Australian
economy.
(1) Can the minister outline to the house how this
government is responding to the challenge in the lithium industry ?
(2) Can the
minister advise the house how this response is protecting local jobs and
continuing our push to become a global hub for the processing of battery
minerals?
The SPEAKER :
The expectations are high, minister!
INDUSTRY — GOVERNMENT SUPPORT
887. Ms A.E. KENT to the Minister for Mines and Petroleum:
I am very excited to pose this question.
Several members interjected.
Ms A.E. KENT : Sorry, it is exciting in my area. People
will be excited—trust me. I refer to the Cook Labor government's
—
Several members interjected.
Ms A.E. KENT : You are all excited now!
The SPEAKER : Sorry, pause for a moment. Pause the
level of excitement. Member for Kalgoorlie.
Ms A.E. KENT : I refer to the Cook Labor government's
commitment to supporting local jobs and diversifying the Western Australian
economy.
(1) Can the minister outline to the house how this
government is responding to the challenge in the lithium industry ?
(2) Can the
minister advise the house how this response is protecting local jobs and
continuing our push to become a global hub for the processing of battery
minerals?
The SPEAKER :
The expectations are high, minister!
AnswerView source ↗
(1)–(2)
I do not want to sound like Big Kev from the television, but I am excited as
well. I am excited and I know the member is such an advocate for the mining and
resources industry in her electorate—in particular, in her region.
I am excited for the future of the
lithium industry because I know that in the future, most of us will be driving
an electric vehicle and we will probably all have a battery at our garage at
some point in the next decade or two. There will be Ministers for Energy,
including our current one, in the future who will continue to put lithium
batteries on our grid to help supplement the renewable energy revolution that
our state and the world is going through. But to do that, we are going to need
a shed load of lithium. We are going to need so much of it.
Western Australia has some of the
best deposits of lithium in the world. We know that the lithium industry is
crucial to our plans to diversify our economy. We know that iron ore, gold and
grain are always going to be massive for Western Australia, but we need to
diversify into these other minerals, and lithium is key to that.
We want to move down the value
chain and make sure that we downstream process in WA to help reduce carbon
emissions. As the member knows, the lithium industry has grown really rapidly
in recent years to be the biggest hard rock industry of its type in the world.
It supplies approximately 50 per cent of the world's lithium.
Anecdotally, I think about 70 per cent of the critical minerals in a Tesla
battery come from under the ground in Western Australia.
In the last financial year,
lithium mining generated $8.4 billion in sales and delivered $710 million in
royalties to help pay for the operations of state's hospitals, roads
and schools. During the same period, it supported more than 11 000 workers,
many of whom are in the member's electorate. Although we know lithium
prices peaked in the December quarter of 2022, it has now moderated with new
supply coming on board around the world. Current market prices for spodumene
concentrate remain below the long-term sustainable consensus price.
This sudden and unexpected plunge
in the price has meant that some companies, as we know, are facing challenges
around Western Australia. We have to remember that whilst the upstream lithium
sector is maturing, the downstream
processing sector is very much in its infancy. Therefore, to help those
industries along, especially over the next couple of years while the
world market matures, I was glad to announce with the Premier today that the
Cook Labor government is introducing a lithium industry support program. The
program is designed to assist lithium miners in the ramp-up phase of
production, as well as downstream processing facilities.
In considering what assistance we
could provide to best serve our lithium sector, whilst also being responsible
to all Western Australians, we have moved to introduce a number of initiatives.
These include a lithium industry support
program to temporarily waive some government fees for downstream processing ;
to waive port charges and mining tenement fees for 24 months for lithium miners
during the ramp-up phase of their operations; and, importantly, all lithium
miners can apply for a loan facility to help those under-pressure mines to
access temporary interest-free loans to sustain their operations.
I
emphasise that this program is for a time-limited period of up to 24 months and
the Department of Energy , Mines,
Industry Regulation and Safety will do a financial assessment of the operation
to ensure that the government is providing support where it is needed,
while protecting Western Australians and their resources and finances. We hope,
and it is expected, that lithium prices will recover to economically sustainable
levels towards the end of 2026 and into 2027. This is about getting miners to
that point and making sure that we have skin in the game when worldwide demand
increases.
It is another example of how our
government is investing in our future while protecting local jobs and ensuring
we remain a battery metals powerhouse. This package will provide important
temporary and responsible support for our fledgling lithium industry, taking
extremely challenging market conditions into account. We will continue to work
with the government and to advocate for the production tax credit that is
before the federal Parliament this week. If passed, it will begin in 2027–28
and apply to downstream processors. It is such an important scheme for Western Australia
and I call on all members, especially on the opposition benches—I note
that on 18 November, the Liberal member for Flinders, Zoe McKenzie, said on Sky
News that she believed that the production tax credit was a ''tokenistic
grab'' for votes in the west. She is someone who clearly does not know
about the WA mining industry. That is another example of how the federal
Liberal and National Parties hate WA.
I do not want to sound like Big Kev from the television, but I am excited as
well. I am excited and I know the member is such an advocate for the mining and
resources industry in her electorate—in particular, in her region.
I am excited for the future of the
lithium industry because I know that in the future, most of us will be driving
an electric vehicle and we will probably all have a battery at our garage at
some point in the next decade or two. There will be Ministers for Energy,
including our current one, in the future who will continue to put lithium
batteries on our grid to help supplement the renewable energy revolution that
our state and the world is going through. But to do that, we are going to need
a shed load of lithium. We are going to need so much of it.
Western Australia has some of the
best deposits of lithium in the world. We know that the lithium industry is
crucial to our plans to diversify our economy. We know that iron ore, gold and
grain are always going to be massive for Western Australia, but we need to
diversify into these other minerals, and lithium is key to that.
We want to move down the value
chain and make sure that we downstream process in WA to help reduce carbon
emissions. As the member knows, the lithium industry has grown really rapidly
in recent years to be the biggest hard rock industry of its type in the world.
It supplies approximately 50 per cent of the world's lithium.
Anecdotally, I think about 70 per cent of the critical minerals in a Tesla
battery come from under the ground in Western Australia.
In the last financial year,
lithium mining generated $8.4 billion in sales and delivered $710 million in
royalties to help pay for the operations of state's hospitals, roads
and schools. During the same period, it supported more than 11 000 workers,
many of whom are in the member's electorate. Although we know lithium
prices peaked in the December quarter of 2022, it has now moderated with new
supply coming on board around the world. Current market prices for spodumene
concentrate remain below the long-term sustainable consensus price.
This sudden and unexpected plunge
in the price has meant that some companies, as we know, are facing challenges
around Western Australia. We have to remember that whilst the upstream lithium
sector is maturing, the downstream
processing sector is very much in its infancy. Therefore, to help those
industries along, especially over the next couple of years while the
world market matures, I was glad to announce with the Premier today that the
Cook Labor government is introducing a lithium industry support program. The
program is designed to assist lithium miners in the ramp-up phase of
production, as well as downstream processing facilities.
In considering what assistance we
could provide to best serve our lithium sector, whilst also being responsible
to all Western Australians, we have moved to introduce a number of initiatives.
These include a lithium industry support
program to temporarily waive some government fees for downstream processing ;
to waive port charges and mining tenement fees for 24 months for lithium miners
during the ramp-up phase of their operations; and, importantly, all lithium
miners can apply for a loan facility to help those under-pressure mines to
access temporary interest-free loans to sustain their operations.
I
emphasise that this program is for a time-limited period of up to 24 months and
the Department of Energy , Mines,
Industry Regulation and Safety will do a financial assessment of the operation
to ensure that the government is providing support where it is needed,
while protecting Western Australians and their resources and finances. We hope,
and it is expected, that lithium prices will recover to economically sustainable
levels towards the end of 2026 and into 2027. This is about getting miners to
that point and making sure that we have skin in the game when worldwide demand
increases.
It is another example of how our
government is investing in our future while protecting local jobs and ensuring
we remain a battery metals powerhouse. This package will provide important
temporary and responsible support for our fledgling lithium industry, taking
extremely challenging market conditions into account. We will continue to work
with the government and to advocate for the production tax credit that is
before the federal Parliament this week. If passed, it will begin in 2027–28
and apply to downstream processors. It is such an important scheme for Western Australia
and I call on all members, especially on the opposition benches—I note
that on 18 November, the Liberal member for Flinders, Zoe McKenzie, said on Sky
News that she believed that the production tax credit was a ''tokenistic
grab'' for votes in the west. She is someone who clearly does not know
about the WA mining industry. That is another example of how the federal
Liberal and National Parties hate WA.
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