WA Budget aims to stimulate growth & exploration

The Western Australian State Government has presented a $108.2 million Budget for 2009-10, to further develop the State’s renewable energy and mining exploration.

This is an increase from the previous year’s allocation of $95.5 million, as a result of funds for the Exploration Incentive Scheme (EIS) received under the Royalties for Regions initiative.
Funding for the EIS will provide just over $16 million to encourage exploration and discovery of new mineral deposits throughout the State’s greenfield and frontier areas during the next financial year.
Development of geothermal energy will also get a boost of almost $587,000.
Mines and Petroleum Minister Norman Moore said the Department’s Budget had made cuts in media and consultancy costs to save up to $1.7 million.
“The current economic downturn has seen a decline in global commodity prices and reduced exploration activity in the past six months, but during this downturn the EIS will help encourage exploration and significantly increase the knowledge of the State’s geology and resources,” said Moore.
“This will improve employment opportunities and build our regional communities in preparation for the inevitable industry upturn.”
The Minister said developing alternative energy sources, such as geothermal energy, was vital in order to give WA greater energy security and to address the international issue of climate change.
“Geothermal energy has the potential to provide clean energy to the State’s electricity network and offer innovative solutions for companies to meet their power needs,” he said.
Australian industry body AMEC was positive on the WA Budget. Its CEO Simon Bennison said the Budget had some welcome news for the sector and appeared to strike a reasonable balance given the current global economic situation.
“AMEC welcomes the WA State Government’s commitment to match their Federal counterpart’s $339 million partial funding of the new Oakajee Port,” Bennison said.
“Oakajee will serve all Western Australians for many years to come, ensuring the efficient export of the State’s vast reserves of bulk commodities which in turn will secure a strong royalty stream into the future.
“The $377 million announced in the Budget for deepening the Fremantle Port and continued construction of the Port Hedland Port Authority’s Multi User Panamax Berth at Utah point is also very welcome news.”
He said that explorers and small miners will also appreciate the one-off payroll tax rebate but hope longer-term initiatives will be introduced next year to permanently bring down the payroll tax burden for all small to medium enterprises.
The Chamber of Minerals and Energy of WA (CME) generally welcomed the State Government’s focus on jobs and investment whilst working to maintain the State’s Triple A credit rating in its 2009/10 State Budget.
CME chief executive Reg Howard-Smith said that while the Government acknowledged the need to invest now in the key areas of people, water, energy and infrastructure to provide for the State’s future growth, there were some areas of concern.
“Clearly, as acknowledged by the Treasurer, we are in a challenging time in the face of the global financial crisis, resulting in a negative impact on Government revenues.
“Government investment in building infrastructure is critical to the development of the significant resource projects underway and planned in the State, as well as the communities in which they operate.
“These projects will deliver substantial economic stimulation and employment in Western Australia and without Government support there is a risk the opportunities provided by them might not be fully realised,” Howard-Smith said.
He welcomed the Government’s $8.3 billion Asset Investment Program however sees a shortcoming in the deferral of transmission projects including the North Country Reinforcement Line.
“There needs to be some clarity on the timing and fate of these projects - if cancelled it would mean a substantial impediment to future investment in these areas,” said Howard-Smith.
He also noted the apparent lack of funding for the Esperance Port upgrade.
CME welcomed the Government’s commitment to the Pilbara through the $300 million Pilbara Revitalisation Plan, and regional communities through $9 million of expanded support for the Royal Flying Doctor Service. The investment of $47 million in training related initiatives is an important recognition of the future skill needs of the State.

WA Budget statements are available at http://www.ourstatebudget.wa.gov.au/

Calls for CCS project proposals
The Minister for Resources and Energy, Martin Ferguson has called for project proposals for the Australian Government's $2 billion Carbon Capture and Storage (CCS) Flagships Program.
The 2009 Budget included $4.5 billion for the Clean Energy Initiative, of which $2 billion will go to building at least two, and up to four, industrial scale CCS projects in Australia.
This is in line with the Government’s commitment to support the Global Carbon Capture and Storage Institute in working towards the G8 goal to develop at least 20 large scale integrated CCS projects globally by 2020.
"The nominated projects will be reviewed by an independent expert panel which I will establish in consultation with the National Low Emissions Coal Council and the Global Carbon Capture and Storage Institute,” said Ferguson.
"The National Low Emissions Coal Council will provide advice on priority CCS technologies to assist my Department in drafting program guidelines and selection criteria to be used to shortlist projects this year and to guide the final selection of projects in 2010.”