1345.4 - SA Stats, Feb 2008
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 26/02/2008
Page tools:
 Print Page
 Print All
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SOUTH AUSTRALIA'S MINING INDUSTRY SUMMARY STATISTICS, South Australia
(b) For the Engineering Construction Survey, the mining industry refers to the commodities 'Oil, gas and other hydrocarbons', 'Bauxite, Alumina and Aluminium', 'Coal and coal handling', 'Other minerals' and 'Other heavy industry'. n.a. Not applicable SOUTH AUSTRALIA'S MINING INDUSTRY AND COMMODITIES PRODUCED The Australian mining industry has experienced considerable growth over the last few years, driven by increasing world demand for our resources and rising commodity prices. This article provides an overview of the mining industry in South Australia including the types of commodities produced, the value of the industry, employment, wages, exploration and capital expenditure. The article presents an analysis of the industry from 1994-95 to 2006-07. This article presents an analysis of the South Australian mining industry in the context of the state's biggest mine - Olympic Dam. Located 560kms north of Adelaide, Olympic Dam contains the world's fourth largest copper deposit and the world's largest uranium deposit (BHP Billiton, 2008). It also contains significant quantities of gold and silver. The mine began production in 1988 and has been expanded in several stages to its current production capacity of around 235,000 tonnes of copper and 4,600 tonnes of uranium each year. The owner of the mine, BHP Billiton, is currently undertaking prefeasibility studies for further expansion of the mine to more than double the current production capacity. Further information on the proposed Olympic Dam expansion is available from the BHP Billiton website <http://www.bhpbilliton.com> Olympic Dam is a significant contributor to the total value of mining commodities produced in South Australia each year. In 2005-06, $1,360m worth of copper was produced in South Australia with virtually all of that coming from Olympic Dam (Geoscience Australia, 2007). Furthermore, $254m of uranium oxide was produced in South Australia in 2005-06, with 82% of that coming from Olympic Dam (Australian Uranium Association, 2008). South Australia produced 22% of total copper production in Australia in 2005-06, and 48% of all uranium oxide production. Table 1 SELECTED COMMODITIES PRODUCED - 2005-06
Source: Mining Operations, Australia, 2005-06 (cat. no. 8415.0) GROSS VALUE ADDED In 2006-07, the South Australian mining industry contributed $2,550m in original, chain volume terms, to Gross State Product. This was an increase of 3.6% from the $2,462m gross value added in 2005-06. Over the last 12 years, the growth of the mining industry in South Australia has been below that of the wider South Australian economy. From 1994-95 to 2006-07, the gross value added of the mining industry increased 20.6% from $2,115m to $2,550m. The state's total GSP increased by 40.4% during this same period. However, from 1997-98 to 2006-07, the growth of the mining industry (21.4%) has been similar to that of the wider economy (25.5%) The gross value added of the mining industry in South Australia appears to be linked with activity at Olympic Dam. As shown in Table 2, there was a period of significant growth in SA's mining industry from 1998-99 to 2000-01 with gross value added increasing 33%, compared to 9% for SA's total GSP. The rapid growth during this period coincides with a major expansion of operations at Olympic Dam. From 1997 to 2000, the operations of the mine were expanded to increase output from 84,000 tonnes of copper per annum to 200,000 t/a and from 1,500 t/a of uranium to 4,600 t/a (BHP Billiton, 2008). Table 2 GROSS VALUE ADDED, Chain Volume Measures, Original, South Australia
COMMODITY PRICES When analysing the value of the mining industry, it is important to consider the influence of commodity prices. In recent years, there have been significant price increases for most commodities including copper, uranium, gold and crude oil. For example, the price of copper has increased from US$2,766 tonne in 1994-95 to US$7,087 tonne in 2006-07, while uranium increased from US$10.17 lb to US$81.17 lb during the same period (ABARE, 2007). The increases in commodity prices are a major factor when assessing the mining industry over recent years. As demonstrated further in this article, the commodity price rises have contributed to the increase in the value of mining exports from South Australia and have given businesses extra incentive to increase exploration for new mineral and petroleum deposits.
Source: ABARE, Australian Mineral Statistics 2006-07 EXPORTS The value of mining related commodity exports from South Australia in 2006-07 was $2,345m, which was 26% of the total value of exports from South Australia. This proportion has doubled over the last few years from 13% in 2003-04 to 26% in 2006-07. The value of mining exports increased from $979m to $2,345m during this period while the value of total exports increased from $7,608m to $9,015m. The main mining related commodity class exported from South Australia in 2006-07, according to ANZSIC, was 'Copper, Silver, Lead and Zinc Smelting, Refining' with $1,843m. MINING RELATED COMMODITY EXPORTS AS A PROPORTION OF TOTAL EXPORTS, South Australia (a)(b) (a) Where the final stage of production or manufacture occurs in South Australia (b) Includes ANZSIC Mining Division B and Manufacturing Groups 251 Petroleum Refining, 252 Petroleum and Coal Product Manufacturing n.e.c. and 272 Basic Non-Ferrous Metal Manufacturing. Source: ABS data available on request, International Trade in Goods and Services, Australia (cat. no. 5368.0) EMPLOYMENT The average annual number of people employed in the mining industry in South Australia has increased steadily from 3,175 in 1999-2000 to 11,175 in 2006-07. Employment in the mining industry is dominated by male workers. Of the 11,175 people employed in 2006-07, 77% (or 8,625) were males. It is commonly reported that employment in the mining industry will continue to increase in the coming years due to the proposed expansion of Olympic Dam. About 3,000 people currently work at Olympic Dam, and this number is expected to increase when the mine is expanded to more than double its current production capacity (BHP Billiton, 2008). EMPLOYMENT IN THE MINING INDUSTRY, South Australia (a) (a) average of four quarters Source: Labour Force, Australia, Detailed, Quarterly (cat. no. 6291.0.55.003) People employed in the South Australian mining industry earn considerably more money than the average South Australian worker. In August 2007, the average weekly full-time adult total earnings for a person employed in the mining industry was $1,831. The average for all South Australians was $1,065. Mining wages have also grown at a faster rate than the average South Australian wage. Since August 1994, the average weekly full-time adult total earnings for a person employed in the mining industry has doubled from $913 to $1,831, whereas the average for all South Australians increased by 67% from $637 to $1,065. FULL-TIME ADULT TOTAL EARNINGS, Original, South Australia Source: ABS data available on request, Average Weekly Earnings, Australia (cat. no. 6302.0) Mineral & Petroleum Exploration South Australia has experienced considerable growth in mineral and petroleum exploration over the last two years. In 2006-07, the value of expenditure on mineral exploration was $261m, up from $67m in 2004-05. Most of the growth in mineral exploration in South Australia has been due to increased exploration for copper and uranium. Of the $261m spent exploring for mineral deposits in 2006-07, $115m was spent exploring for copper and a further $64m for uranium. South Australia's Strategic Plan has set a target for minerals exploration to be maintained in excess of $100m per annum until 2010. Expenditure on exploration for petroleum has also increased substantially over recent years. In 2003-04, the value of expenditure on petroleum exploration was $53m. In 2006-07, this had risen to $161m. Most petroleum exploration in Australia occurs in Western Australia. In 2006-07, $1,481m was spent exploring for petroleum in Western Australia, most of which was offshore. MINERAL AND PETROLEUM EXPLORATION, Current Prices, Original, South Australia Source: Mineral and Petroleum Exploration, Australia (cat. no. 8412.0) EXPENDITURE ON MINING EQUIPMENT AND INFRASTRUCTURE Capital expenditure in the mining industry has fluctuated over the last decade and has been significantly influenced by expenditure at Olympic Dam. The spike in expenditure on equipment, plant and machinery in 1997/98, as shown in the graph below, coincides with the expansion of Olympic Dam when production capacity was increased from 84,000 tonnes of copper per annum to 200,000 t/a (BHP Billiton, 2008). The proposed further expansion of Olympic Dam is likely to significantly affect the level of engineering construction and capital expenditure on equipment, plant and machinery in coming years. The value of engineering construction in the South Australian mining industry increased sharply in 2006-07 to $667m. There were several major mining related projects under construction in 2006-07 including the Prominent Hill project and Project Magnet at Whyalla. The copper and gold deposit at Prominent Hill is located 650kms north west of Adelaide. The mine was discovered in 2001, with development beginning in 2006. The mine is expected to be in production by the end of 2008. EXPENDITURE ON MINING EQUIPMENT AND INFRASTRUCTURE, Current Prices, Original, South Australia Sources: ABS data available on request, Private New Capital Expenditure and Expected Expenditure, Australia (cat. no. 5625.0); Engineering Construction Activity, Australia (cat. no. 8762.0). CONCLUSION While Western Australia, Queensland and the Northern Territory have been the main beneficiaries in Australia of the current global 'mining boom', the mining industry in South Australia is also undergoing a period of growth. There have been recent increases in the number of people employed in the industry as well as the value of mining exports from South Australia. The recent increase in expenditure on exploration for new mineral and petroleum deposits provides strong impetus for further growth of the industry. As demonstrated throughout this article, Olympic Dam is a critical component of the mining industry in South Australia. REFERENCES ABARE (Australian Bureau of Agricultural and Resource Economics) 2007, Australian Mineral Statistics, June quarter 2007 ABS (Australian Bureau of Statistics), Australian and New Zealand Standard Industrial Classification, 1993, cat. no. 1292.0.15.001 ABS, Australian National Accounts: State Accounts, 2006-07, cat. no. 5220.0 ABS, Average Weekly Earnings, Australia, cat. no. 6302.0 ABS, Engineering Construction Activity, Australia, cat. no. 8762.0 ABS, International Trade in Goods and Services, Australia, cat. no. 5368.0 ABS, Labour Force, Australia, Detailed, Quarterly, cat. no. 6291.0.55.003 ABS, Mineral and Petroleum Exploration, Australia, cat. no. 8412.0 ABS, Mining Operations, Australia, 2005-06, cat. no. 8415.0 ABS, Private New Capital Expenditure and Expected Expenditure, Australia, cat. no. 5625.0 Australian Uranium Association, 2008, Australia's Uranium Mines, viewed 1 February 2008, <http://www.uic.com.au/> BHP Billiton 2008, Olympic Dam Expansion, viewed 13 February 2008, <http://odx.bhpbilliton.com/> Geoscience Australia 2007, Australia's Identified Mineral Resources, 2007 Document Selection These documents will be presented in a new window.
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
