SACOME's nine state budget priorities
1. Mineral Exploration Incentive
The establishment of a South Australian Exploration Incentive remains a top-order priority for SACOME which has near unanimous support from industry.
Total mineral exploration expenditure in the State is now sitting at approximately $49 million, compared to a peak of $328 million in 2011-12.
All jurisdictions in Australia couple their investment in pre-competitive data with co-funded exploration drilling incentives. The need for such incentives is now vital given South Australia has recorded its lowest exploration investment figures in a decade.
Direct funding to explorers remains critical in supporting the resources sector in the discovery of new deposits and ensuring a continuing pipeline of resource projects.
Previous exploration incentive programs have been fundamental in South Australia’s ability to attract investment in mineral exploration and ultimately contributing to an increase in State mining revenue of $2.4 billion over the lifetime of the initiative.
Much of the State’s potentially prospective geology, even in relatively well-explored areas, remains uncharacterised beneath cover and would benefit from strategic drilling.
SACOME calls for: The establishment of a Mineral Exploration Incentive, a co-funded drilling program of $4 million per annum with grant funding for 75% of total project costs capped at a maximum of $300,000.
2. Gas Acceleration Program
Gas generation comprises half of all electricity generation in South Australia.
Gas contract prices in 2018 have eased off the peaks recorded in early 2017, however remain two to three times above historical levels.
Legal restrictions and regulatory hurdles continue to impede onshore gas exploration and development in South Australia, where price and supply remain critical issues for all South Australian consumers. Importantly, the continuing high cost of gas for Commercial &Industrial operators have become a concern that, in some cases, threatens future viability.
SACOME calls for: The establishment of a Gas Acceleration Program which mirrors the Federal Government scheme and incentivises the responsible development of South Australian gas projects.
3. Critical Commodities Strategy
Emerging technologies require critical commodities and as a result demand for critical minerals such as lithium and rare earths is growing rapidly.
South Australia hosts 80% of Australia’s battery grade graphite resources and has large quantities of lithium, cobalt, manganese and nickel.
SACOME calls for: State Government to expedite the development of a South Australian Critical Commodities Strategy and to align that strategy with the Federal Government’s National Resources Statement.
4. Regional Province Development
The benefits to South Australia of unlocking regional resources provinces are enormous and only tempered by the significant challenges both the private sector and the State face in facilitating development or prerequisite infrastructure.
Access to power and water, rail and port infrastructure is critically important to development of existing and new resources provinces.
Recent announcements by BHP and OZ Minerals regarding expansion of their Olympic Dam and Carapateena projects will require significant infrastructure upgrades.
Consideration should also be given to the infrastructure needs of the Upper Spencer Gulf following announcements by GFG regarding expansion of steel production.
The opening of the Whyalla Port to third-party access by GFG and development of a transhipping port at Port Augusta by CU River significantly resolve a key step in the export pathway and provide a timely opportunity to strategically reassess resources infrastructure development across the State.
SACOME calls for: State Government to develop a South Australian Resources Infrastructure Plan with cross-agency involvement with DPTI, DEM and Infrastructure SA and work with the Federal Government within the context of the National Resources Statement to identify how Federal resources can be leveraged to progress the development of South Australian resources provinces.
5. Augusta Highway Duplication
SACOME supports the call by the RAA and the SA Freight Council for the duplication of the Augusta Highway.
The duplication of the Augusta Highway creates economic efficiencies for the resources, agricultural and freight sectors.
SACOME calls for: State Government to implement a comprehensive infrastructure solution for the Augusta Highway that anticipates future freight movement and improves national productivity and efficiency across multiple sectors, and remedies community safety and access issues.
6. Energy Storage Funding
SACOME welcomes this State Government’s Grid Scale Storage Fund (GSSF) initiative that assists in stabilising the provision of renewable energy.
South Australia has the highest penetration of renewable wind and solar generation in the country, with 50% of our electricity generation capacity coming from renewables.
Electricity storage technology compatible with our generation mix will reduce the price and volatility of electricity supply, increase system security, and boost industry confidence.
SACOME calls for: State Government to increase funding to the GSSF to further facilitate the development of new storage technologies capable of addressing the intermittency of South Australia’s electricity system.
7. Battery Circular Economy and PV Solar Panel Recycling
Battery Circular Economy
Australia currently has low battery recycling rates. 95% of cobalt, lithium and graphite in batteries can be reused.
This provides South Australia with the opportunity to establish an economy in the re-use and recycling of batteries.
The value to South Australia can be three-fold. South Australia could draw additional value from existing materials, minimise impact on the environment an establish a new industry in re-use and recycling.
SACOME calls for: State Government to provide a report on the Battery Circular Economy.
PV Solar Panel Recycling
In 2018 Commonwealth, State and Territory Environment Ministers agreed to fast-track new recycling schemes to manage solar panels across their entire life cycle.
Such a scheme could reduce waste to landfill, especially hazardous materials found in e-waste; increase recovery of reusable materials in a safe, scientific and environmentally sound manner, and provide access for households and small businesses across Australia to an industry-funded recycling service.
SACOME calls for: State Government to investigate establishing a state program to recycle PV solar panels.
8. Mining Act Approvals
SACOME reiterates that there are still structural issues with the Mining Act 1971.
Comprehensive reform of the Mining Act 1971 will streamline approvals, clarify land access concerns and drive greater levels of investment in South Australia.
While comprehensive reform of the Mining Act 1971 is a formidable task, it is one that SACOME submits will yield long-term benefits for the State and the sector.
Reform of mining approval processes under the Mining Act 1971 are long overdue and SACOME has already submitted possible solutions to the public record.
SACOME calls for: State Government to reform the Mining Act 1971 approvals process having regard to processes in other States and Territories.
9. Federal/State Approvals
SACOME reiterates its call that the Environment Protection and Biodiversity Conservation Amendment (Bilateral Agreement Implementation) Bill 2014 was intended to give legislative effect to draft bilateral agreements between the Commonwealth and the South Australian Government for streamlining approvals under the EPBC Act and creating a single, State-based approval mechanism. This process remains split between State and Commonwealth regulators.
In a 2014 red-tape review of the EPBC Act, the Commonwealth Government calculated that a ‘one-stop-shop’ for environmental assessment and approvals would produce a benefit of $426 million in regulatory and business costs.
SACOME calls for: State Government to prioritise and provide requisite funding for the alignment of State and Commonwealth environmental approval processes.