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Carrapateena in South Australia is shaping up as a major copper-gold project.
In a statement last month, the proponent (OZ Minerals) made clear its commitment to the project. The ore-production rate is to be increased over what was previously planned; work on a decline will commence next month (mining will be underground); and final processing will take place at Whyalla, a regional city approximately 200 kilometres south of the minesite.
All going well, construction will commence next year, with first production in 2019. Estimated capital cost: nearly A$1 billion (over US$700 million).
The project estimated cost is close to A$1 billion (or over US$700 million).
OZ Minerals says that the choice of Whyalla (as opposed to the mine site) for final processing is based on good access to “skilled labour, port, rail, roads, power, water, gas and oxygen”.
In this context, it hopes to use some infrastructure facilities of the steel and mining company, Arrium, which is in administration.
Not surprisingly, this is strongly supported by the state government, which sees the future of Whyalla threatened should Arrium be forced to close.
South Australia is not a major mining state compared with Western Australia and Queensland. However, it has an interesting mining history, with the former BHP (now BHP Billiton) playing a major role.
In the 1850s (pre-BHP), the Burra copper mine north of Adelaide was the largest metal mine in Australia.
As from the late 1880s, Port Pirie smelted ore from the newly established Broken Hill lead-zinc-silver mine in New South Wales (where BHP made its start).
In 1899, BHP started mining iron ore inland from Whyalla; this was initially used as a flux for the Port Pirie smelter. Subsequently, this iron ore became feedstock for the steel plant that BHP established in Whyalla in 1941 (and is now owned by Arrium).
Today, Olympic Dam is the largest mining operation in South Australia. Owned by BHP Billiton, it is a major world producer of copper, gold and uranium.
Apart from Carrapateena, OZ Minerals operates the Prominent Hill copper-gold mine; there are three uranium mines (including Olympic Dam); there are several iron-ore mines and several more planned; graphite is widely found in the Eyre Peninsula; and Iluka Resources operates a major mineral-sands mine in the far west of the state.
South Australia is well regarded by mining companies; in its latest (2015) annual survey, the Fraser Institute of Canada places the state among the top 10 jurisdictions globally in terms of its attractiveness for mining investment.
