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Wednesday, August 29, 2012
Roxby stays strong By Jason Munn oxby Downs community leaders were unperturbed and remained positive despite BHP Billiton’s announcement last week to cancel the current Olympic Dam mine expansion process.
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“All the businesses in town have been surviving on what is here now, not on what is in the future,” President of the Roxby Central Traders Association, Leigh Malcolm said. “It’s no big surprise to me.” Mr Malcolm believes the expansion had been overly spruiked by the Government who had been using it as a political play thing. “BHP Billiton made a market decision, and we’d be no different if our conditions changed – I understand the operation of business, they have a responsibility to their shareholders, just as I have a responsibility to the bank. “There’ll be a little bit of uncertainty and hesitation initially, and then I think we’ll all
get over it and it’ll be business as normal.” Raine and Horne’s Craig Sumsion said he was glad a decision had been made. “We’ve had all this speculation over the last couple of months, so now BHP Billiton has come out and laid their cards on the table, we can get on with business. “The Olympic Dam mine has been operating here for 25 years or more, the town’s been here for 25 years. Most people living in the town are still employed at the mine in its current form. It’s still Australia’s largest underground mining operation. I don’t see this announcement changing the town at all. “From my point of view, we need to change the outside perception, because people seem to forget that there is a successful mine and a vibrant town here.” Mr Sumsion said politicians and the media had built an image of Roxby Downs being totally reliant on the expansion and were generally playing the blame game, which does not help anybody.
“Regardless of the expansion, Roxby Downs will keep going as it has.” He believed the expansion will eventually happen, but in another form. “BHP Billiton has said it’s a world class ore body with a world class product, and they still want to get that out of the ground. Unfortunately the circumstances at the moment won’t allow them to do that. It’s not to say the circumstances won’t change next year or the year after so that it can go ahead. We’ve been building to this point over a 25 year period, what’s another few years?” He believed people were depending too much on the expansion and had geared themselves up to a point where they were disappointed at the announcement. “There are other developments happening in the State,” he said. “Once people forget about the expansion we’ll see the town go back to how it was when people weren’t talking non-stop about it, and were talking about the positives of Olympic
Dam in its current form.” From a real estate sales point of view, Mr Sumsion said the decision will have an effect on outside investors purchasing rental properties in the town. “That, I believe, will slow quite significantly for a while. That’s just the nature of investment within mining towns, it’s very much a confidence thing. A lot of people were hoping to ride off the back of the expansion with good capital growth on their investment, and looking at Roxby Downs as potentially performing similar to the Queensland and Western Australia mining boom towns. “I don’t believe that was going to be the case anyway. We would have had some growth, and better growth than the major capital cities, but it wouldn’t have grown out of control.” He said the market of people who are looking to move in as owner occupiers will never change.
INSET LEFT: Aerial photo of the Olympic Dam mine. INSET RIGHT TOP: President of Roxby Central Traders Leigh Malcolm. INSET RIGHT: Raine and Horne’s Craig Sumsion.
Olympic Dam still number one T
By Vanessa Switala
he Olympic Dam resource remains a “tier one” asset for BHP Billiton and will continue to meet the global demand for copper for decades to come.
South Australian Chamber of Mines and Energy (SACOME) Chief Executive said although the recent news of the Olympic Dam expansion was disappointing, the exciting growth of South Australia’s resource sector would continue. His comments came after BHP Billiton shelved the project last week, citing the massive downturn in the global resource sector and subdued commodity prices.
The decision to postpone the expansion should only be seen as a sensible move to ensure the project proceeds in a financially sustainable way, Mr Kuchel said. “Olympic Dam will continue to contribute significantly to the State and South Australia’s many other mining and energy projects currently underway in the pipeline will continue to shape our growing resources sector,” Mr Kuchel explained. He said while the announcement will come as a disappointment to many, it does not spell adversity for the State’s mining and energy sector. Mr Kuchel said although the Olympic Dam expansion had been a focus of State and
national attention, South Australia’s mining and energy sector had diversified dramatically over the past decade and the State currently boasts 20 major mines with many more projects in the pipeline. “South Australia has a lot on the go with several new mining regions, exciting oil and gas developments and a multitude of small and midtier miners who collectively could bring just as much, if not more, benefit to the State than the expansion of Olympic Dam,” he said. Mr Kuchel told The Monitor, “I don’t think any other mining project was waiting on Olympic Dam as a catalyst, in fact some of the project pro-
ponents are maybe a little relieved as it gives them breathing space to get their projects developed.” “SA never had a mining boom, but rather we have been experiencing good strong steady growth with growth from four to 20 mines in less than a decade and over 30 projects in the pipeline. “This good strong steady growth will continue and the build-up of capability in the service sector will bode well for them getting a larger slice of the Olympic Dam expansion pie when it arrives,” he explained. Roxby Downs’ Administrator Bill Boehm said the announcement is obviously dis-
appointing for all concerned but is understandable in light of the current economic circumstances including the high Australian dollar. “The challenges that BHP Billiton face on capital requirements are immense but the Olympic Dam Expansion Project remains a high priority. It is pleasing that the company has strengthened its efforts with respect to investigating new technologies that will hopefully ensure that the project can proceed in the medium term,” Mr Boehm explained. “The resource is immense, has a long life, will have to be exploited. The current deferral is only a ‘blip’ in the scheme of things, with many
SACOME CEO Jason Kuchel. legislative approvals remaining in place.” Mr Boehm told The Monitor Roxby Downs remains positive as always and has a bright future. “Most towns would be very envious of what we have in Roxby. We are very lucky.” See Full Story Page 3...